Second half outlook 2020

Second half outlook 2020

Good Afternoon

Michael Gibbs, the chief macroeconomist at Raymond James, published a brief article on June 03 about the economic recovery and outlook for the US markets. 

His team has predicted an 8.7% return, which means an upside price target of 3,384 on the S&P 500. This is based on the current level of 3112 (as of June 18, 1:24 pm). However, the downside price target in their model is much lower at 2,431, a 21.88% decrease. The media clearly outlines the risks of investing in the market, including China tensions, COVID-19 resurgence, and other factors that make it challenging. 

Despite these risks, the reasons to be overly BULLISH are more prevalent, as no one acknowledges the big bull elephant in the room. 

The Federal Reserve runs a full-blown freight train full of stimulus through 2020 and beyond. In addition, we will spend more than seven trillion before Covid‐19 is over. It is possible that another 800 billion dollars could be sent through our legislative branch by the end of July. 

The bottom line is that unemployment numbers will stay high until there is a vaccine and, likely, after the 2020 election.

 However, the stock market can continue trending higher over the long run, contingent on support from the Federal Reserve and non‐legislative interference. Politics will soon create more noise towards November 04. However, the market will not care who wins the election, Republican or Democrat. Particular sectors will perform better than others, and once we know who will win, we can create a game plan to navigate forward. There is still time to evaluate our electoral candidates and their policies.

In conclusion, the article suggests that it is better to be bullish and optimistic. Positivity will create more positivity.

I encourage readers to find three things today that are good and loving.

My picks:

America

History class

Air-conditioning.

Wife

That’s it.

Stay tuned for a big announcement shortly.

Cheers

Christopher lakian