{"id":170235,"date":"2020-05-08T11:10:09","date_gmt":"2020-05-08T15:10:09","guid":{"rendered":"https:\/\/www.countingpips.com\/?p=170235"},"modified":"2020-05-08T10:14:41","modified_gmt":"2020-05-08T14:14:41","slug":"are-rallying-stock-markets-out-of-step-with-economic-reality","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex\/2020\/05\/are-rallying-stock-markets-out-of-step-with-economic-reality\/","title":{"rendered":"Are rallying stock markets out of step with economic reality?"},"content":{"rendered":"
May 8, 2020<\/div>
\r\n<\/div><\/div>

By George Prior <\/strong><\/p>\n

Buoyant stock markets are not necessarily ignoring alarming economic data, rather they are reflecting the post-pandemic era, affirms the CEO of one of the world\u2019s largest independent financial advisory organizations.<\/p>\n

The observation from deVere Group chief executive and founder Nigel Green comes as official figures on Friday revealed that more than 20 million people in the U.S. lost their jobs in April and the unemployment rate more than trebled.<\/p>\n

Mr Green comments: \u201cThe staggering U.S. unemployment numbers wipe out a decade\u2019s worth of job gains. There\u2019s been nothing like this since the Great Depression.<\/p>\n

\u201cYet U.S. stock futures climbed higher as global markets rose on Friday.\u00a0 This is highly unusual.\u201d<\/p>\n

He continues: \u201cThere are two things happening simultaneously here.<\/p>

\r\n
\r\n

Free Reports:<\/p><\/div>\r\n

\r\n

<\/a>\r\n\t Get Our Free Metatrader 4 Indicators<\/u><\/b><\/a> - Put Our Free MetaTrader 4 Custom Indicators on your charts when you join our Weekly Newsletter<\/p>

\r\n
\r\n
\r\n

<\/a>\r\n\t Get our Weekly Commitment of Traders Reports<\/u><\/b><\/a> - See where the biggest traders (Hedge Funds and Commercial Hedgers) are positioned in the futures markets on a weekly basis.<\/p>

\r\n<\/div>\r\n

\r\n
<\/div>\n

\u201cFirst, a weak first half of 2020 has already been priced-in.<\/p>\n

\u201cAs have the risks of a potential second wave \u2013 but the concerns of this are being largely contained as it is not such a \u2018bolt out of the blue\u2019.<\/p>\n

\u201cIt is extreme uncertainty, the likes of which we saw at the peak of the pandemic, that typically upsets markets.<\/p>\n

\u201cWhether they are correct in their assessment remains to be seen, but markets are looking towards the second half of the year.\u00a0 They appear to believe that there is likely to be a steady economic recovery as key advances are made in coronavirus treatments, as central banks continue to implement and further bolster historic stimulus packages, and as lockdown restrictions around the world are eased to revive activity.\u201d<\/p>\n

He goes on to add: \u201cSecond, and perhaps more importantly, stock markets are reflecting what is going on in the economy right now and what it\u2019ll look like post-pandemic.<\/p>\n

\u201cA closer look at the markets reveals that, of course, not all stocks and sectors are rising equally. They are being driven up across the board by the \u2018winners\u2019 of this new era including tech, biotech, home entertainment and established online retailers, amongst others.<\/p>\n

\u201cWe can assume that these, and other stock market \u2018winners\u2019, are showing us what the future economy looks like.\u201d<\/p>\n

The deVere CEO concludes: \u201cThe optimistic stock markets seem at odds with the grim economic data.\u00a0 They may be being overly confident, even complacent.<\/p>\n

\u201cBut it could also be the case that they are giving us clear signals for the current and future shape of the economy, in which there are and will be distinct winners and losers.<\/p>\n

\u201cA good fund manager will help investors seek out the opportunities and mitigate potential risks as and when they are presented to generate and build their wealth.\u201d<\/p>\n

About:<\/strong><\/p>\n

deVere Group is one of the world\u2019s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients.\u00a0 It has a network of more than 70 offices across the world, over 80,000 clients and $12bn under advisement.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

By George Prior Buoyant stock markets are not necessarily ignoring alarming economic data, rather they are reflecting the post-pandemic era, affirms the CEO of one of the world\u2019s largest independent financial advisory organizations. The observation from deVere Group chief executive and founder Nigel Green comes as official figures on Friday revealed that more than 20 […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-170235","post","type-post","status-publish","format-standard","hentry","no-post-thumbnail"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/170235","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/comments?post=170235"}],"version-history":[{"count":1,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/170235\/revisions"}],"predecessor-version":[{"id":170236,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/posts\/170235\/revisions\/170236"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/media?parent=170235"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/categories?post=170235"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex\/wp-json\/wp\/v2\/tags?post=170235"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}