Fisher Investments Market Outlook Discussion Forum

Topic: Stock Market Positives and Market Outlook

Welcome to the Fisher Investments discussion forum on the outlook for global stock markets. Fisher Investments believes it's important to interpret the news with a critical eye and seek out opportunities others may be ignoring. Too often the media is focused on negativity and important positives are overlooked. Therefore, Fisher Investments has devoted this forum to identifying and discussing important stories and events that signal positive developments in the current economic, political and market environment. In addition, Fisher Investments encourages employees to discuss the research and observations pertaining to the current market outlook.

The following represents commentary by Fisher Investments’ staff members on the above mentioned topic. All comments are subject to the website disclaimers located here.

27 Comments

Japanese auto makers
Added by LRD on 11/3/2009
Three Japanese car makers reported slumping earnings but raised their projections for their full fiscal year, amid signs that cost-cutting is beginning to pay off. As a Fisher Investments employee, I believe this event encourages hope for an economic rebound.

Cash is king...but for how long?
Added by jd on 11/2/2009
An article in today's Wall Street Journal highlighted the fact firms have more cash (as a percentage of assets) on hand now than they have for forty years. This could be interpreted as bad news--those managing these firms aren't dumb, we must have more bad times ahead. But more likely, this is a residual effect of market sentiment overshooting to the dour side. With an economic recovery in the fore, cash-rich balance sheets combined with improving sentiment could potentially unleash a tidal wave of business spending--great for stocks, great for the economy.

trade discussions
Added by DEzzat on 10/30/2009
The US and China made headlines a few short months ago over continued trade spats and claims of protectionist actions. Recently, there's been some positive news on trade. Both countries realize how beneficial free trade is and are working toward easing trade restrictions. I believe this is definitely a step in the right direction as free trade will aid in the global recovery.

GDP's up
Added by JM on 10/30/2009
Yesterday’s announcement of a positive (up 3.5%) third quarter GDP was certainly good news. The stock market’s ongoing bull rally has been indicating that an economic recovery was developing, but it never hurts to get a bit of confirmation. Many positive factors contributed to the economy’s growth, including a rise in consumer spending.

Hiring Boost
Added by LRD on 10/26/2009
Good news trickled in from labor markets today, in my view. According to the National Association for Business Economics, the percentage of businesses expecting to hire staff over the next six months exceeded the share projecting more firings by 4 points, the first positive reading since July 2008. As a Fisher Investments employee, I believe the stock market often recovers ahead of the economy. However, this positive news bodes well for the job market and economic recovery.

look to China
Added by DEzzat on 10/23/2009
As a Fisher Investments employee, I know that a healthy economy begets job growth, not the other way around. In recent news, China experienced an increase in jobs as their economy is strengthening. I think this is a positive sign and may help lessen unemployment fears of US investors!

Earnings Strength
Added by LRD on 10/20/2009
In the midst of earnings seasons, many companies have reported stronger than expected earnings. As a Fisher Investments employee, I believe this is a positive for the stock market and additional fuel for the economic recovery.

actions speak louder than words
Added by DEzzat on 10/16/2009
Today, the media highlighted another bit of positive news worth mentioning. Foreign investors' appetite for US long term assets is rising! As a Fisher Investments employee, I think this is comforting news for nervous investors claiming the world is turning their back on the US. Actions speak louder than words and in this case, I think it's better to look at the evidence. I believe there's still a large interest in our assets and I think this is news to pay attention to.

Flexibility
Added by JM on 10/15/2009
In the recent days and weeks, central bank officials from around the world are reaffirming their commitments to maintaining low interest rates and accommodative monetary policy. As a Fisher Investments employee, I believe this flexibility is a good sign for the economic recovery.

The dollar is going away? Nah.
Added by evec on 10/13/2009
As a Fisher Investments employee, I find it difficult to believe all the hype surrounding the supposed demise of the US dollar. Such rumors have abounded before when the US was going through other difficult economic times. I wouldn't be surprised to see nothing come of this other than more rumors. The dollar's status as the global currency reserve is likely still very strong, and if there is a chance it will be unseated, it will likely take a very long time.

consumer spending
Added by DEzzat on 10/9/2009
As a Fisher Investments employee, I know not to be concerned with consumer spending as a major economic indicator. But it's important to note that while many are fearing the effects of decreased consumer spending, retail sales have been reported higher recently. I think consumers are more resilient than most believe. Consumers, both young and old, are spending and I think this is a positive sign for those folks thinking the consumer is "tapped out" or hoarding money into savings.

Bull Market
Added by JM on 10/9/2009
As DEzzat said, investors likely have a lot to look forward to in the coming months. While the stock market recovery of the past six months has been undeniably steep, that doesn’t mean positive returns (albeit maybe a little less steep than these past months) can continue! The market is fully in bull market territory, and that spells good news for investors. The market is also a leading economic indicator, so it’s months of positive activity augurs well for the upcoming economic recovery.

V shaped recovery
Added by DEzzat on 10/2/2009
In the midst of a "V" recovery, I think it's important to note that the second half of a recovery can produce returns just as strong as the first. Great news! As a Fisher Investments employee, I believe investors needn't fear the idea of weak returns in the second half of a recovery solely because stocks are moving "too far too fast." The ride doesn't need to end here...investors should buckle up and enjoy the ride for the second half of the year as well!

Wall of Worry
Added by JM on 10/2/2009
With stocks down for the second week in a row, many investors are fearful of what’s next. As a Fisher Investments employee, I believe the pervasive negative sentiment that is dominating the media right now is truly a bullish sign for the stock market. It’s often said a bull market climbs a wall of worry – so I say, the more worried investors, the better! Leading economic indicators, including the stock market, continue to rise month after month, meaning a stronger recovery is likely in the making in my opinion.

Jobs numbers still lagging, but that's no surprise
Added by evec on 9/29/2009
It seems some are good at finding bad news among lots of good news; namely, jobs numbers. The media admits the economy appears to be in a recovery mode, but jobs numbers are still rising. This isn't unusual; in fact, it's normal, if history is any indication. Jobs numbers WILL recover--but well after the market and economy do. So while not good news, jobs numbers isn't surprising news, and as a Fisher Investments employee, I wouldn't be surprised to see a recovery in jobs data well after the market and economy have recovered.

Batten down the hatches
Added by LRD on 9/28/2009
In preparation for disastrous weather, a ship's crew will secure all openings of the ship using canvas and wood planks (called battens). Figuratively, to batten down the hatches means to prepare for the worst. As a Fisher Investments employee, I believe US businesses did just that with the onset of the recent economic squall. To entertain the metaphor, not only did business batten down the hatches, but they also rounded up most of their non-critical inventory and crew (unfortunately) and threw them overboard. To this effect, many US business are starting to emerge from the economic dark clouds leaner and lighter then ever. In my view, this is a powerful trend once economic tailwinds resume.

Positivity
Added by JM on 9/25/2009
While there will always be skeptics out there doubting that the stock market could really run up as much as it has before the economy recovers, recent data just may be proving them wrong. The roughly 6 month lag time between market recovery and economic recovery has been noted historically, and economies around the world are starting to log positive figures. China, Germany and France all have posted positive GDP numbers, unofficially marking the end of their respective recessionary periods.

Outstripping expectations
Added by jd on 9/23/2009
I think you're right LRD--in fact, there are plenty speculating the recession ended this quarter (of course, we won't know officially for awhile yet). With all the stimulus still out there, and given there's typically a lag before it hits, we could see economic performance outstripping expectations for quite awhile yet. That’s great news for stocks.

Stimuli
Added by LRD on 9/22/2009
Good news from across the pond: UK Prime Minister Gordon Brown has said the global economy has yet to feel the biggest impact of goverment-led spending programs to stimulate demand. As a Fisher Investments employee, I recognize that governments aren't the most efficient spenders. However, there's no denying that we are in the middle of the largest global stimulus package in history. That's a poweful statement which underscores my belief that the recession will likely end quicker than many cynics expect.

Ignoring a New Bull
Added by evec on 9/22/2009
I saw an interesting article today, its subject was something along the lines of how many seem to be ignoring the biggest bull market ever. As a Fisher Investments employee, I tentatively agree. Many media stories and headlines appear to think we're still in a bear market rally, when less and less evidence supports such a notion. We should cheer this new bull and be encouraged by the market's continuous several-month rise!

no euphoria? don't worry!
Added by DEzzat on 9/18/2009
There have been several headlines doubting this recovery and heeding others against what looks like a bull market. I think this is great news for investors! It's quite the opposite. I believe investors should worry when people are overly euphoric. In my opinion, a bit of pessimism and predictions on the "next shoe to drop" are great signs the bull market likely still has a long way to go.

global recovery
Added by DEzzat on 9/11/2009
As JM has pointed out, the year anniversary of the economic crisis has arrived and there's a lot to cheer about. Not only has the US swung into recovery mode but talks of China's fast paced economic recovery abound. With their lending easing and production increasing, headlines were littered with praises for China's economy today. I think investors should be on the lookout for continued global recovery.

A Year Later
Added by JM on 9/11/2009
It’s been almost a year since last September’s collapse of Lehman brothers and bailout of AIG. Many didn’t imagine it possible, but the stock market is already into a new bull market, and the economy is beginning to show signs of recovery! While it hasn’t been an easy year for investors, it’s important to see the positives occurring today.

Recovery?
Added by JM on 9/4/2009
I agree with evec. Stocks’ ongoing rally is likely a good sign for the economic recovery. As a Fisher Investments employee, I know history shows stock markets rise before the economy. Now that this rally is headed into its six month, the economic recovery is likely right behind!

Volatility is common
Added by evec on 9/1/2009
It's important to remember volatility is a normal part of healthy, properly functioning markets. As a Fisher Investments employee, I believe it foolish to be scared out of stocks because of ups and downs here and there. History shows, overall, stocks go up over time, with dips in between.

Rally!
Added by JM on 8/27/2009
As a Fisher Investments employee, I believe it’s important for investors to keep an eye out for stock market positives, especially in today’s volatile investing environment. Many are tempted to let the bad news discourage them, but a new bull market is underway. Since the March 9th market lows, US and global stocks alike have rallied significantly. As evec mentioned below, the economy now appears to be improving as well, which will only serve to add fuel to the stock market’s fire.

Upswing in stocks likely bodes well for the economy
Added by evec on 8/25/2009
This recent, continuing upsurge in stocks is encouraging--as a Fisher Investments employee, I believe this is likely bodes well for the economy since history shows that stocks generally lead an economic recovery, not the other way around.