Arguments put forward by John Eade, President of the Argus Research in favor of stock market bulls are sure to soothe investors’ angst over a potential sell-off/crash in equities due to numerous reasons – rising bond yields, monetary policy exhaustion, US election uncertainty. Eade is joined by Tip TV’s Nick Batsford.
On US stocks
- Underlying fundamentals – ultra low bond yields, expected pick up in corporate profits, export led growth due to weak dollar – remains supportive
- Markets could see flattish heading into elections
On Fed rate hike
- Fed could hike in December…Don’t think Fed would hike in September
- Fed is preparing the markets for a modest amount of hikes
- Short-end of the treasury yield curve is heading higher
Growth in US
- Likely to be in the consumer sector, exporters are going to do better on weak dollar. Government spending is going to pick up as both presidential candidates have talked about fiscal spending
On US elections
- Trump victory unlikely to rock markets, Trump unlikely to follow through on his outlandish victory