All the headlines for the past few days have been focusing on the potential government shutdown which takes place at midnight tonight. It doesn't appear that either side is willing to back down at this point and the best case to avoid a shutdown may be another short term deal. But I'm not here to talk about politics and the politicians inability to compromise and find middle ground. We have to consider what the shutdown means to our clients' investment portfolios.
What would US stocks do if President Trump suddenly resigned?
Last Wednesday, Convergex's Chief Strategist Nick Colas pondered on this question, “What would US stocks do if President Trump resigned?”
Will the stock market boom or bust in 2017?
As we near a close to 2016, it is time to look forward to 2017. We have done this in 2014, 2015, and 2016 so it is becoming a tradition to see which strategists did well and which missed the mark. What do the experts think will happen in 2017 and should we even care?
Perhaps you are familiar with Philip Telock's landmark UC Berkeley study that looked at 82,000 predictions over 25 years by 300 leading economists. It turned out that their so called expert views were no better than random guesses, and worse, the more famous, the less accurate the prediction.
Last year, the strategists predicted a bull market for 2016 and they almost hit the number right on the mark. Their average forecast was for a 7.2% gain in the S&P 500 to 2215. They should get a round of applause as the S&P finished at 2239. Well done. Deutsche Bank's David Bianco gets the highest grade with a forecast of 2250, only missing by 11 points. Barclays' Jonathan Glionna should also be given a trophy as he was within 2% for the past couple of years. Let's look at the numbers.
Tom Lee: Republican “Revolution” Could Extend Bull Market
Runnymede has been bullish on the stock market since early July because of improving earnings and good value relative to fixed income. As we ahead to 2017, we remain positive. Former JP Morgan Chief Equity Strategist Tom Lee shares our enthusiasm for equities in a recent interview on CNBC.
8 Days Later: Trump effect on financial markets
It's been 8 days since the Presidential Election and financial markets have had quite a wild ride. On election night, S&P futures traded down limit of -5%. It appeared that markets would react strongly to the downside much like after the Brexit vote. However, the markets quickly digested the surprising Trump decision and markets have traded sharply higher on hopes that Trump's policies will be inflationary and stimulate the economy. While it is too early to tell what he will be able to accomplish, financial markets have wagered some early bets on who the winners and losers will be. The early winner is financial stocks. Trump is widely expected to roll back the regulations of Dodd-Frank which were enacted after the financial crisis of 2008. Financials are also benefiting from the rise in long term interest rates which benefits their net interest margin and equals larger profits. The sharp move in interest rates caused headaches for high dividend stocks which were the hardest hit with REITs, consumer staples and utilities all in the red.