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Fasten Your Seat Belts For Stocks 2008
Standard & Poor’s Equity Research believes, a sharp increase in volatility of U.S. stocks can be explained by increased fears that the threat of a recession is slowly Corporate Earnings per share (EPS) growth in the months ahead. In addition to longstanding concerns about the weak U.S. housing market and high energy prices, these have never been able to write to major financial institutions, investors feared that the United States to strengthen credit conditions is employment and wages, and against the backs of U.S. consumers say our analysis.
For the future, the question arises, investors, whether the recent weakness is a healthy correction or the beginning of a new decline. While limited visibility regarding macroeconomic conditions, it is a call demanding, we believe that the Standard & Poor’s 500 shares recently trading at estimating only 14 times 2008 EPS, several weak quarters of gross domestic product growth and EPS are included in the price of the equity market.
Given that we expect that the United States for a recession lasting at EPS businesses continue to grow, albeit at a slower pace than many believe, we believe, in recent years in the low of 1400 on the S & P 500 is.
In addition to the factors we have listed, Mark Arbete, S & P’s Chief Technical Strategist, believes that 1400 is important in terms of technical assistance to long-term trend of the year 2002 bear market and a critical support graph-August low. Dominant negative sentiment indicators are another sign that the market level, in our eyes.
It is not surprising that at the sectoral level, Finance and Consumer Discretionary have borne the main burden of the sale and are now the only two sectors posting negative year-to-date supplies. We also recommend that investors underweight in their portfolios.
Like other sectors of the battery for 2008? This series of reports analyzing the prospects of S & P five sectors: the four councils of weight with the market, the market capitalization greater weighting in the S & P-500 and an area to excess recommendation. A selection of five of S & P Top of stocks in different sectors is also to be seen.
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