Market Outlook: Bullish, Americans are Underinvested

Market Outlook: Bullish, Americans are Underinvested

Market Outlook: Bullish, Americans are Underinvested


Friday, BlackRock’s  (NYSE:BLK) CEO Larry Fink said he is “quite bullish” on stocks because of robust economic global growth.

The US economy and the global economies “are strong enough to continue the upward bias on equities,” he said in a TV interview.

We are “quite bullish”

“We believe the US economy and the global synchronized, global economies are strong enough to continue the upward bias on equities,” he said.

He explained that “investors are underinvested,” which means he thinks there’s more money on the sidelines that could come into the market.

“The demand in credit and other assets is going to keep a spike in interest rates to be more muted,” he said.

“We think interest rates are going to be higher, and we do not think this is necessarily bad.”

Corporate results for Y 2017’s Q-4 will start pouring in next week and are expected to be laden with 1-time charges as US companies begin to cope with tax code changes, including a 1-time tax on trillions of dollars in profits held overseas

Wall Street investors will be tuned in to CEO’s statements about plans for Y 2018 and beyond for savings that will result from a deep cut in corporate income taxes enacted last month by the US Congress and President Donald Trump.

Many companies will use their tax savings to buy back shares and increase dividends, while others will look for increased capital spending or wage increases.

The tax law was President Trump’s 1st major legislative achievement since he took office in January last year, and it slashes the corporate income tax rate to 21% from 35%.

The tax package helped drive stock market gains in the last months of Y 2017 and into Y 2018.

My expectation is that savvy investors will overlook Q-4 charges and focus on upbeat corporate outlooks.

Shayne and I feel confident the Trump tax cut will be a win to a big win for US companies.

HeffX-LTN Analysis for SPY: Overall Short Intermediate Long
Very Bullish (0.69) Very Bullish (0.71) Very Bullish (0.77) Very Bullish (0.58)

Have a terrific weekend,

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

2 Responses to "Market Outlook: Bullish, Americans are Underinvested"

  1. Robert Smith   January 12, 2018 at 3:18 pm

    Exceeding $6 trillion in assets, strong growth in ETF business, overall stellar results for BlackRock

    • Paul Ebeling   January 12, 2018 at 3:39 pm

      Thank you Robert. Have a happy day. Paul

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