2016 Year started with the US stock market caught in the midst of challenging uncertainties, but also opportunities. Despite thick clouds hanging over investors' decisions, AroniSmartInvest™ In Action picked a few promising stocks, mostly international, to watch. In the next article, we will see how those stocks have performed. Meanwhile, let us recap those uncertainties and lights of opportunities, before drilling down on performance.
First, there were persistent weaknesses in the international oil markets. The slowing Chinese economy remained of concern, and the Middle East wars had intensified.
Second, there was a recent Federal Reserve Bank decision to raise interest rates which sent both positive vibes and worries in the markets.
Third, the job market continued to improve. Forth, European economies were slowly coming back from a recession. But at the same time, some once thought promising economies had shown major weaknesses. These includes Brazil, Angola, Argentina, Nigeria, Venezuela, Saoud Arabia, and South Africa.
In Q1 2016, following a rocky start, the US stock market started picking up momentum despite the lingering challenging uncertainties. Federal Reserve Bank decisions and focus on interest rates and banking regulations continued to send both positive vibes and worries in the markets. The job market continued on its improvement trajectory and the feared recession in European economies did not materialize, as predicted.
At the start of Q2 2016, the uncertainties and swings in the stock market that had plagued the stock market since the start of the year had given place to a positive momentum as investors were reviewing their stock portfolios and the US stock market picked up momentum. Economic indicators published in early Q2 2016 helped: April New Home Sales, April Pending Home Sales , and April Durable Orders and GDP growth all beat expectations or were close. The job market was heating up, with employers facing a challenge, good for those seeking jobs: worker shortage. The persistent weaknesses in the internationa markets appeared to have been factored into the market performance: oil markets, the slowing Chinese economy, the never ending Middle East wars and refugee crisis and the growing uncertainties and sometimes chaos in developping economies. Result: In early June 2016 , Dow Jones Industrial Average (DOJ) climbed from a low of 15766,71 to 17,865.34, or 13%.
Then Brexit came. By mid June 2016, the markets were significanly negatively impacted but remained resilient. However, by August 10, 2016, the markets had recovered and most of the stocks picked by AroniSmartInvest ™ in Action have shown, over the last 6 months, stellar performances, as highlighted in the next article.
Source: AroniSoft, LLC, August 12, 2016