5 Financial Gurus Discuss Stock Market Futures and the Issue of Predictability

financial graph from the stock market

With the economy changing so drastically lately, the stock market has started to experience some changes as well. Whether these changes are for the best or not depends on who you ask. The stock market can be quite unpredictable, which raises the issue of degree of predictability and overall future experiences. We’ve gathered the predictions of 5 financial gurus in what concerns stock market futures and what to expect.

Stock Market Futures: 5 Financial Gurus Weigh In

1. Significant Risks

U.S. Stock Strategist for Bank of America Merrill Lynch, Savita Subramanian believes that in the future, the stock market will become less certain. This means the risks will be higher than usual, and the outcomes will have contrasting results. On the one hand, there will be a certain amount of euphoria, and on the other hand, people will be disappointed in the stock market.

Regardless of the attitude, both reactions will be either extremely passionate or quite low-energy. According to Subramanian, big market swings will have a lot of potential as well. Moreover, people will focus more on risk followed by a potential reward, than on absolute targets.

2. Hope vs Fear

Chief US Equity Strategist at Goldman Sachs, David Kostin identifies elements in the stock market that bring hope, as well as elements that bring fear. Among the things that could foresee a bright future for the stock market are less regulations, fiscal stimulus, and the repatriation of cash from overseas. The things that bring fear are, in Kostin’s view, the rising inflation, which could prompt the Federal Reserve System to tighten, the rise of bond yields, and the limitation of tax reforms due to the budget deficit.

3. Trumponomics

Sean Darby, Global Head of Equity Strategy at Jefferies, says that Donald Trump becoming president has significantly changed the stock market. He talks of trumponomics, a trend characterized by fiscal relaxation, as well as protectionism. These two trends are both U.S. dollar and inflationary bullish, so characterized by rising share prices. The strength of the dollar will cover earnings and tighten liquidity conditions.

4. Volatility

Chief Investment Strategist at BMO Capital Markets, Brian Belski is concerned with the volatility of the stock market in the future. He believes that this will be a constant theme, together with increased doubt and consternation. Even so, he still believes in the potential of the stock market. He underlines the fact that U.S. companies are resilient, which they’ve demonstrated many times in the past. This will surely contribute to their survival. Belski also advises investors to stop attempting to time the stock market.

5. Fast Advancement of the Equity Market Stateside

Chief Investment Strategist at Oppenheimer Asset Management, John Stoltzfus expects tailwinds that will advance the equity market stateside. These tailwinds are brought about by Donald Trump’s fiscal agenda, which Stoltzfus calls stimulative. This advancement will also support stock prices. Still, investors won’t notice its effects until the fiscal policies are enacted and take effect.

We hope these 5 predictions regarding stock market futures coming from financial gurus have helped you get a clearer idea of how the stock market is going to progress, so that you know how to build your stock portfolio.

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Author: Amanda Knowles

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