Top market lessons from 2016
Fortunes cannot be told, raging bulls will not be tamed and tides are more telling than waves, writes Michel Pireu
After the worst start to a year, the US stock market surged to new highs in 2016. All the major indices rebounded to records and defied the doomsday forecasts that preceded events such as Brexit and Donald Trump’s election. "Sell everything except high-quality bonds." This is going to be a "cataclysmic year", the Royal Bank of Scotland (RBS) advised its clients in January. Beware of forecasts and predictions. "Nobody can come close to predicting the future — it’s a lesson I need to keep relearning every year … month … week … day" — Bob Seawright. Besides putting RBS in the running for the worst call of 2016, its advice demonstrated yet again you can’t afford to pay too much attention to headline-grabbing analysts, investment banks, media commentators or other so-called gurus. The concern for this year is that no strategist at a top Wall Street firm is predicting that the bull market will come to an end. Most expect the US’s largest companies to return to earnings growth and to see o...
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