Is this the end of the bull market?
Global investment manager, Eaton Vance, has noted that this month has marked one of the longest bull markets for US stocks in history.
Although the bull market has been one of the longest, lasting 113 months, it has not been the strongest, with the S&P 500 appreciating 411 per cent from 2009 to August 2018 or 18.9 per cent per year.
However, the record set by the market was in the 1990s when it returned 21.6 per cent per annum during its run.
According to Eaton Vance, the current expansion was in its ninth year, which was the third-longest of the post-war period.
“Historically, leading economic indicators such as consumer confidence, homebuilder sentiment, jobless claims and high-yield credit spreads deteriorate before recessions, but we see no evidence of that at this time,” Eaton Vance portfolio manager, Yana Barton, and director of growth equity, Lewis Piantedosi, said.
“Furthermore, the US consumer, the primary engine of the US economy, remains healthy, buoyed by fiscal stimulus, strong employment and wage growth.”
Additionally, they believed the environment for active stock investors remained favourable and historically low interest rates were supportive of further economic growth, with some central banks such as the Federal Reserve moving to a tightening stance.
Overall, the monetary policy remained accommodative or neutral at worst, they said.
“There are winners and losers in any market, and we believe investors focused on fundamentals should continue to be rewarded. We continue to be selective in stocks of companies we believe should benefit from long-term secular tailwinds and excel irrespective of the market ‘inning’ we are in.”
AUTHOR
Oksana Patron
Recommended for you
Some 42 per cent of CEOs say they are actively reinventing their business to stay relevant in the next decade, with consumer services the most common choice for asset and wealth managers.
Former Ophir Asset Management chief executive, George Chirakis, has joined private equity manager Scarcity Partners, while the asset manager has appointed a replacement from Macquarie.
Australian Unity has appointed a fund manager for its Healthcare Property Trust, joining from Centuria Healthcare, as it restructures the product with a series of senior appointments.
Financial advisers nervous about the liquidity of private markets funds for their retail clients are the target of fund managers launching semi-liquid products which offer greater flexibility and redemptions.
