Since the November election, the financial markets have priced in a more friendly business environment, with growth boosted by expansionary fiscal policy. However, the White House does not have absolute power.
Longer-term bond yields are near their highs for this cycle, while the environment for riskier assets like high-yield bonds, bank loans and stocks remains positive.
Based on the little substance that emanated from the presidential campaign, it is almost impossible to game the precise market and economic policy implications of a Trump presidency. What there is to guess at suggests possible gains for the financial sector, companies leveraged to infrastructure, and healthcare companies, should there be dramatic reform to the Affordable Care Act.
The December Employment Report showed the job market to be in good shape. The pace of job growth slowed in 2016, partly reflecting tighter labor market conditions.
So proclaimed Bloomberg in an interesting column about investors losing interest in hedge funds due to poor performance, or perceived poor performance, and high fees. I won’t defend the fees but will point out that fewer and fewer hedge fund investors pay the full 2 and 20 (2% management fee with 20% of the gain) in the last few years.
With the US stock market roaring ahead to close 2016 on a high note, the question for many investors is whether the momentum can be sustained.
Matthew Beesley, Head of Global Equities, believes that the impact of technology and an ageing population are likely to be the key themes shaping global equity markets in 2017, while the incoming US President’s planned shift to fiscal stimulus should be supportive for global equities.
Over the last few weeks I’ve fielded several financial related questions (more personal finance than actual investing) from some younger people in my life (mostly nephews). This is a great reminder of a point I have made quite a few times over the years which is that even if you’re not an advisor...
The outlook for 2017 is now shaping up as a battle of ideas, though few seem to be realizing it yet. The stock market has risen since the election.
A day or two after the election someone (not a Trump fan) asked me about selling out of the market as they apparently thought the market would go down. This is a great example of something that repeats over and over in the market and the thought process of market participants.