Vision of the markets to 7-28-2017
Some of my predictions have not been fulfilled because the Federal Reserve is acting very well to strengthen the economic recovery, and is that it is being very prudent in carrying out rate increases, since it has only made one, and the withdrawal Of bond purchases, which has not been realized. Therefore the market remains “doped” and the US stock market is still at highs.
European stock exchanges are something else. With an incipient economic recovery, virtually all of Europe has great investment opportunities.
And the question is why the US stock market is at highs and European stocks are not. Because the leading companies in both areas are different. In the United States leading companies are in very good shape, Microsoft, Google, Apple, beat their sales and profits record. The United States is more leader than ever in the most powerful economic sectors, computer, internet, social networks, etc. Europe has lagged behind, European companies are not able to generate cash and live off the economy that is still in crisis, this is the banking sector and construction.
As an example, in Spain the leading companies remain the banks, BBVA and Banco Santander, and ACS, construction. The European stock market shows opportunities, its leaders are weak, I see opportunities in the banking and construction sectors across Europe. Anyway you have to select well, there will still be cleaning of some company that will fall, small businesses.
My only prediction was to see the opportunity in Arcelor Mittal giving figures for recovery in the steel sector. This in turn gives us the signal that construction will show growth in the coming months.
My recommendation, buy cheap and sell expensive.