deVere analyst: Historic bull run will continue, but prepare for market sell-off
September 6, 2018 (Investorideas.com Newswire) The longest bull market rally in history has further to run - but investors may wish to start to build cash positions before next year, affirms a top analyst at the world's largest independent financial advisory organization.
The message from Tom Elliott, deVere Group's Senior International Investment Strategist, comes after the S&P 500 index reached a new all-time high late August, and recorded its longest ever rally (which began in March 2009).
Mr Elliott comments: "Wall Street is celebrating the longest stock market rally in history. One suspects it has further to go, given that the current defining features of the U.S. economy - strong growth and a cautious Fed - are an investor's dream.
"This happy combination can be seen in last week's upward revision to second quarter U.S. GDP growth estimates, to 4.2 per cent, which comes just a week after Fed chair Jay Powell promised caution over the pace of interest rate hikes next year in his address at Jackson Hole -- although he did as good as confirm two more rate hikes this year, in September and December.
"Furthermore, global stock and credit market valuations are more attractive than at any point this year, thanks to corporate earnings growth outpacing share price growth."
He continues: "But while the outlook for Wall Street over the coming months appears good, as we go into 2019 investor sentiment towards the U.S. stock market may change sharply.
"Cautious investors may want to start building up cash positions, and so take advantage of any sell-off.
"After all, the Fed's caution is justified: many economists suspect that behind the current GDP growth spurt are temporary boosts to the economy, such as tax cuts and strong exports of goods ahead of the imposition of counter tariffs by America's trading partners."
He goes on to say: "Then we have political risk, whether over trade negotiations, North Korea, Iran, and the risk of the impeachment of Donald Trump, should the Democrats win control of the Senate in the mid-term Congressional elections.
"But perhaps the biggest risk to investors is the steady draining away of global liquidity, as central banks end or - in the case of the Fed, actually put into reverse - their quantitative easing policies."
Mr Elliott concludes: "A diversified multi-asset portfolio remains the best protection against unpredictable markets. This should contain exposure to global equities and bonds, with property, gold and cash also included. After all, a 2 per cent return on dollar cash isn't to be sneezed at."
t: +44 207 1220 925
deVere Group is one of the world's largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients. It has a network of more than 70 offices across the world, over 80,000 clients and $12bn under advisement.
This news is published on the Investorideas.com Newswire - a global digital news source for investors and business leaders
Disclaimer/Disclosure: Investorideas.com is a digital publisher of third party sourced news, articles and equity research as well as creates original content, including video, interviews and articles. Original content created by investorideas is protected by copyright laws other than syndication rights. Our site does not make recommendations for purchases or sale of stocks, services or products. Nothing on our sites should be construed as an offer or solicitation to buy or sell products or securities. All investment involves risk and possible loss of investment. This site is currently compensated for news publication and distribution, social media and marketing, content creation and more. Contact each company directly regarding content and press release questions. Disclosure is posted for each compensated news release, content published /created if required but otherwise the news was not compensated for and was published for the sole interest of our readers and followers. More disclaimer info: https://www.investorideas.com/About/Disclaimer.asp Learn more about publishing your news release on the Investorideas.com newswire https://www.investorideas.com/News-Upload/
Additional info regarding BC Residents and global Investors: Effective September 15 2008 - all BC investors should review all OTC and Pink sheet listed companies for adherence in new disclosure filings and filing appropriate documents with Sedar. Read for more info: https://www.bcsc.bc.ca/release.aspx?id=6894. Global investors must adhere to regulations of each country.