A Positive Turnaround in the US Stock Market?
The US stock markets are currently facing a potential turnaround that is significant for both private and institutional investors. This change is driven by various factors affecting both fundamental and technical analyses.
Fundamental Analyses
Recovery of Technology Stocks: The so-called “Magnificent Seven” – Apple, Amazon, Alphabet, Microsoft, Meta, Nvidia, and Tesla – are in focus regarding recovery expectations. After a correction, these stocks could regain attractiveness, which could positively influence the overall US stock market.
Economic Fundamentals: Despite current uncertainties, the economic fundamentals in the US remain solid. Inflation is under control, and interest rates could continue to decline, increasing the attractiveness of US stocks.
Profit Growth: Historically, US corporate profits have consistently exceeded expectations, which has been a key driver of the performance of the US stock market.
Technical Analyses
Oversold Technical Indicators: Many technical indicators suggest that the market is oversold, which is often a signal for a short-term recovery.
Seasonal Strength: There is a typical seasonal strength in US stock markets, particularly at the end of the quarter, which could provide additional momentum.
Capital Inflows: Expected capital inflows at the end of the quarter could give the markets further upward momentum.
Outlook and Risks
Exercise Caution: Despite the positive signals, experts warn to be cautious as the markets may remain volatile. A selective investment in quality stocks is recommended.
Economic Risks: Political risks, such as trade tariffs or geopolitical tensions, could weigh on the growth of the US economy.
Valuations: High valuations could suppress long-term returns for investors, meaning repeating the high returns of recent years may not be easy.
Overall, both fundamental and technical analyses suggest a possible positive turnaround in the US stock markets. However, it is important to keep the risks in mind and invest selectively in quality stocks.