Continued Market Volatility
Today’s big sell-off in stocks brings the market averages back to basically unchanged for the year with considerably more volatility than investors have experienced in recent years.
Due to the poor earnings reports expected from the energy sector in Q1 and multinational companies negatively impacted from the strong dollar, the stock market is bracing for the first quarterly decline in earnings since 2009. With the Federal Reserve determined to prevent another recession, the prospects of bond yields rising enough to provide competition for stocks is unlikely in the near term. Global Central banks are working feverishly to continue lowering bond yields and raise asset prices (stocks, real estate); investors in these risk assets will be rewarded.