While the US economic data has remained in growth mode, one wonders how long it can withstand slowing growth from abroad. It is only a matter of time until a European recession starts to affect S&P 500 earnings which are already forecast to decline in the 1Q thanks to tougher comparisons and margin pressures. Remember that the US doesn't have to be in a recession to have stocks move sharply lower. In the Internet/Tech bubble, stocks peaked in 2000 and fell dramatically well ahead of the recession arriving mid-2001.
The Runnymede team still maintains that investors should be extremely cautious in the year ahead. If you would like us to review your portfolio to see if you have too much risk, please email Andy at firstname.lastname@example.org or click the portfolio review button below.
Header photo from Unsplash by Christian Lue