The Case for Optimism

The outlook for equity markets is good, the well-known analyst and commentator David Fuller of Fullermoney newsletter told the Annual Contrary Opinion Forum in the US last month.

Positive factors include accommodative money policies with low interest rates, low inflation, what David likes to call the “progressing” (developing) economies are healthy, the West’s recovery is only 15 months old, household savings are rising, equity valuations are reasonable and corporate balance sheets are mostly strong.

Here is a brief summary of the Fullermoney forecasts:
• The Asian-, resources- and tech-led global stock market recovery is resuming;
• The current cyclical bull market should have several more years to run, provided energy and food prices do not spike higher;
• The US will avoid a double-dip recession with the help of the growth of progressing economies;
• The three-decade bull market in US government bonds is coming to an end – yields will range higher over the medium to long term;
• Gold’s secular bull market has at least several more years to run before it is halted by higher interest rates;
• The secular bull market for industrial commodities will continue, although it will be punctuated by recessions;
• The stock markets of the progressing Asian and resource economies will continue to lead;
• US and European multinationals leveraged to the global economy will outperform;
• Leading or promising sectors include technology, healthcare, mining, agriculture, global infrastructure and dividend increasers.

source and CopyRight OnTarget Newsletter by Martin Spring