Equities and Market Analysis: Current Fundamentals Trump Political Turmoil

Political turmoil may be making headlines, but the current macroeconomic conditions are still looking favorable for the market. Despite the French government’s collapse and other political unrest, experts believe that global equities and US stocks could see some gains in the upcoming year.

The US economy is showing strength, with the Federal Reserve reporting steady economic growth, stable consumer spending, and low layoffs. Federal Reserve Chair Jerome Powell even mentioned that the US economy is in good shape, with growth exceeding expectations. Markets are eagerly awaiting labor and inflation data before the next Federal Open Market Committee meeting in December, where a rate cut is expected.

On the European front, the Eurozone is facing economic challenges, but the European Central Bank is likely to cut rates further to support the economy. This could provide a good opportunity for European stocks, which are currently at reasonable valuations.

Artificial intelligence is also expected to drive growth in the tech sector in the coming years. Companies like Salesforce and Marvell are showing strong demand for AI, which could contribute to the equity bull market. With big tech companies investing in AI, earnings growth in the global tech sector is projected to be strong in the next few years.

Overall, experts suggest that investors should brace for further equity gains. Technology, utilities, and financials in the US are seen as good options, along with Eurozone small- and mid-caps and Swiss high-quality dividend stocks. Diversified exposure to Asia ex-Japan is also recommended to capture potential opportunities.

By focusing on the facts and staying informed about the market outlook, investors can position themselves to potentially benefit from the current market conditions.