Stock Market Forecast 2020
If the job numbers, trade tariff reductions, China deal, USMCA update, and low rates progress, the outlandish forecasts by some analysts might actually happen.
That makes the long term outlook to 2024 look really good too because the American consumer is well employed. The 2020 to 2024 5 year forecast period is not priced into the market, but instead on earnings/sales. And President Trump is demanding fairness from other nations.
Although President Trump is being harrassed by the Demo’s TV hype-filled impeachment party, his pursuit of a real trade deal with China is being viewed optimistically. With recession and market crash fears abating, 2020 could actually be a record year. See the stats below that support an optimistic market prediction.
Find the best stock picks that are making the biggest improvements below and more about the 2020 stock market forecast. Apple has hit new highs while Amazon and Netflix suffer. Find out what Jim Cramer of Mad Money thinks of the stock markets and the best industries.
Volatility from the Trade Deal: Splitting up a China agreement into phases likely won’t be successful. However, there is hope that something positive will evolve from negotiations with China.
Every time Trump hits China with penalties, the US stock markets jump, tariff revenues skyrocket and US business revenues rise. Take a look at the Yahoo chart below and notice the last big drop last November. It jumped right back up. China or no China, the US economic forecast looks strong.
The 2020 stock market forecast looks great for US-based companies which sell US-produced products. If the USMCA agreement is passed, it could bolster the US economy and brighten the housing market forecast. However, the Democrats could see this as their opportunity to thwart Trump, thus taking the economy hostage.
Market history: We’ve been talking stock market forecasts for a while now, so how have the indexes done in the last 5 years?
Technology the Hottest Sector of Late
In Cramer’s excellent report recently, he showed how well known technical charts are warning of a 10% correction to the downside. The markets look great today, but so many factors can come into play to sour the outlook.
We understood the Dow 30 industrials would get hit, but he focused on the S&P. How close are we though to the time that China’s markets collapse if a trade deal is not struck? See the best stock picks for October.
As long as the US stock markets are strong and the employment rate stays high, consumers will keep spending. The FED is expected to lower rates again and more US production is being ramped up. The indexes are up, and note that the Russell small business index is up 6.7% and is best performing in the last 2 weeks.
It’s a good outlook for small cap entrepreneurs when the big companies resume spending. The pain of refusal to invest in America will become too great, and the risk of losing market share will force CEOs and boards to act soon. President Trump is ensuring spending continues during the America First transition.
At this point, we can reassert our belief that China is disappearing from the American economic equation. China stocks will soon be removed from the US stock markets.
Trading Economics Forecasts all markets to sink through 2020 even as prices rise through the most troubled period.
Although the Dow listed companies suffer short term, they will recover in the next 4 years as they move production back to the US. This is what will drive the NASDAQ, DOW, S&P, Russell, and TSX to record highs in 2021.
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With fall approaching, it remains to be seen if President Trump can use taxes and low interest rates to keep the resurgent US economy rolling. Are we on the precipice of a major correction? I predict the US economy will be fine and that unmet consumer demand will ignite US service providers and manufacturing. That could be enough stimulus to reignite the housing markets too.
A glut of natural gas and oil globally could ensure low energy prices and low inflationary pressures. The US is pumping out 13 million barrels of oil per day now and Trump’s threat to take OPEC to court over price fixing is undermining the Saudis attempt to raise oil prices.
President Trump has enough tools to prevent a politically induced slide. Multinational and US CEO’s however have to be convinced before they will resume investing in American production facilities. It is their reduced spending that has brought about the latest stock market jitters and darkened the 2020 economy.
There is another surprising view of US stock market performance that stems from the America First movement. While China and global dependence on US consumers wanes, the US is protected and free to focus on strong growth.
Should President Trump be able to force the multinationals to bring operations and jobs to the US, it would be a market boom scenario.
While the turbulence worries some and the media pushes for a recession, there are some experts who believe this is a brief storm before the US stocks launch into another long bull run going into 2021. With Trump’s relection, US companies sales potential explodes.
As US technology improves, export potential rises, as other countries clamor to stay competitive themselves. They’ll buy US technology, because Trump may give them preferential trade treatment. So Trump does have extensive powers to support the US economic revitalization through 2024.
Yet, the bond markets beckon investors like Poseidon into another recession. Which do you believe?
Stay on the Bucking Bronco?
The stock markets volatility might only reflect anxiety over the process of returning manufacturing to the US from China, and the concerns that the rest of the world can’t take care of itself. The question that hasn’t been resolved for some is what an independent US economy (with Canada and Mexico) looks like and how strong it can be. Well, if we return to the 50’s and 60’s, we remember incredible economic growth and performance.
While the media are pushing for a stock market crash and recession, the underlying economy is excellent – employment, wages, GDP, interest rates, and trade losses are all very positive. US consumer retail numbers are excellent and the US is collecting big tariff winfalls.
Hottest Stocks this Week — Courtesy of Barcharts.com
Google Alphabet, Autozone, Domino’s Pizza, Roku, Chipotle Mexican Grill, Shake Shack, Wayfair, Sherwin Williams stock prices best performing. See more on Barcharts.com.
If we remember that the America First agenda is about America, it might point to good times ahead for American investors and businesses. Still the Dem’s media channels are firm in their 2020 crash forecast and that the global economic withdrawal will somehow come back to haunt President Trump.
Avoiding Media Traps Being Set
I’m of the opinion that President Trump simply needs to weather the media storm, and the US will be back to another bull run stock market after the 2020 election. The President hasn’t put enough pressure on the multinationals to bring manufacturing back to the US. And it’s allowed them to wait it out till the 2020 election. That’s why we’re in this anxious period.
Of course, they’re hoping he’ll lose and jobs will be shipped back to China, then and China’s off to the races again. But what would everyone think of this scenario? Would Americans really be happy with China prosperity and a return of huge trade deficits? China’s recent human rights abuses, and the WTO’s warnings to China about it’s trade unfairness presents issues the communists won’t deal with well.
Strong earnings growth propelled markets through the first 15 weeks of 2019 and that’s continuing. The strength here almost guarantees big IPO activity this year (Uber, Airbnb, Slack).
The recent stock market crisis was a transition and what’s transpired is new record levels for the NASDAQ, DOW and S&P. Investors are calming down as recession fears fade, inflation is subdued, the Federal Reserve is pausing on raising interest rates, and the economy is showing resilience. China-U.S. trade talks are progressing and Brexit fears are dismissed
The Feds pulled back on damaging interest rate rises, trade war fears are dissolving, GDP is up, and China/Brexit issues are in the rearview mirror. Democrats won’t like it, but the markets are poised for much more growth.
Stock Market Forecast Signals
The NASDAQ, S&P, DJIA, and Russell index are 4 key signals in the new American economy. Those analysts who suggested getting out of equity markets might be having second thoughts. See the S&P forecast.
If all you’ve been hearing is doom and gloom global politics, trade retaliation, interfering Fed chairman, price rises, government standoffs, stock market crashes, and housing corrections, you’ll be relieved that the worst is over. Let’s see a common sense look at the stock markets free from media hype and propaganda.
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Enjoy this US focused outlook with data from Trading Economics, NASDAQ, Goldman Sachs, and other data providers which provides forecasts for major stock market indexes, and other key market data sources. Good luck finding the best US stocks to drive your portfolio growth in the next 6 years. US companies will outperform the market.
President Trump is showing some moderation in his attitude toward China and that is making some investors feel better about their chosen stocks. Regardless, Trump is making sure US companies are getting time to breathe and develop. A balancing of China trade though, would mean production of goods and services in the US, shipped to China. Few believe China will live up to its end of the agreement.
Best Stock Picks for 2020?
US stocks are gold. The latest US jobs report, 2020 economic forecast and consumer intent look very good. To help you see the real, big picture context, and make good better decisions on volatile exchanges, here is a big picture look with the right questions to ask.
Here’s Goldman Sachs strategist David Kostin with his stock picks for 2019. He also forecasted “the index climbs by 6% to our target of 2875 in 2019” — interview in TheStreet. Kostin is keen on FAANGs.
- Align Technology (ALGN) (+22% revenue growth estimate)
- Amazon (AMZN) (+22%)
- Autodesk (ADSK) (+27%)
- Cabot Oil & Gas (COG) (+34%)
- Concho Resources (CXO) (+30%)
- Facebook (FB) (+27%)
- Netflix (NFLX) (+25%)
- Pentair (PNR) (+22%)
- Vertex Pharmaceuticals (VRTX) (+22)
He advises high revenue growth firms, and that has to favor US companies. There’s still some value in investing in Faangs, such as Facebook or Google. Facebook had a superb 1st quarter earnings report. See our best stocks picks for 2020.
Why US Stocks Will Win in 2020
US Stock market potential is huge for 2020 and beyond, yet multinational corporations and their investors want to stop the Asia to US transition. They believe cheap Asian labor and products are more profitable.
For them breaking free of Free Trade means tapping smaller pools of labor and not being able to play one government off against another for concessions and minimal taxes. They can’t win dirty anymore nor get bigger margins with scale. Their cheap labor global supply network took quite a while to set up.
These resistors have media, political power, and opportunity to stop the Trump agenda, and to send booming housing and stock markets off course. They’re finding new ways to attack, but Trump is managing to fight them off.
Those importing foreign goods into the US China will face 25% tariffs. Trump’s opponents will find 2019 and 2020 very difficult and although a stock market correction will happen in the next 4 months, the NASDAQ, DOW, and S&P will find a new level and everyone will move on, until fall of 2020 when the big showdown happens.
Longforecast.com offers an interesting month by month forecast of the DOW which is in the graphic below. They forecast troubled times until 2020, and see 2020 ending spectacularly, although not at the 35,000 point level experts were foretelling last summer.
All of the companies in the DOW, NASDAQ and S&P can still make money in the new US-based economy (auto and chip producers for instance), but it might be smaller American companies and those in the Russell 2000 index you should watch.
Questions to Ask About the Markets?
It’s all about questions, because your questions reveal the depth of your understanding. Simple questions lead to better questions which lead to insight. It’s your money so there’s no end to questions.
- are US Stocks rising while foreign stocks falling?
- how is the US government protecting the development of US-based businesses?
- which US economic sectors have the best potential for American businesses?
- are US economic indicators positive (GDP 3.5% and better than expected)?
- what will happen to sectors when interest rates climb?
- is a US-only based stock portfolio offer the best potential, at least until the elections in 2020?
- will FAANG stocks sink further downward if pro-US agenda persists?
- are the DOW, NASDAQ, S&P, and Russell indexes only reflecting the death of the old economy?
- is volatility is a sign of how investors are adjusting/transitioning to US business and away from global business?
- if a recession happens in 2019, could stocks could slide by as much as 20%?
- which us stocks will plunge in 2019 and which of those make a good buy for the longer term?
- trade war would only benefit US business even more because it would solely own the US consumer who are very positive at this time
- should you invest in China, with its 750 million internet users in stocks such as China’s version of Netflix (IQ)? or is everything in China doomed along with its crashing housing market?
- us economic performance so strong in 2017/2018 and investors wonder if the market has peaked
- some experts are pushing the idea of the end of business cycle button
- china/asian companies/stocks are losing their market
- china economy losing its supports — turning inward now
- EU is trying to hang to UK and other departing members
- Saudis indicating they will pump out more oil now so can you expect an oil glut and prices flattening out?
- will shaky relations with the middle east result in major market changes?
- is there still a huge demand for housing markets if economic management wants to support construction?
- is negative sensationalist Democrat media strong enough to talk down the market — and change the focus back to pro-Asia, pro-multinational international corporate perspectives?
- how will volatility affect nervous investors will get little guidance about what what is really happening
- should investors profit on the volatility (VIX index) with market timing?
- will this US midterm result in the usual witn non-incumbents getting elected?
- Is the Fed chairman trying to move the market back to fundamentals and traditional behaviors?
- Is the Fed chairman pushing up rates suggesting his belief the economy will improve in 2019/2020?
- will the Fed raise interest rates and move to end this business cycle?
“If Trump were able to successfully pressure the Fed into adjusting course, it could have sudden and unpredictable effects on the U.S. economy. Markets have long seen the independence of the central bank as a critical ingredient in stability, and Powell has vowed to uphold it” — from Portland Herald Story
- Is the economy adjusting to new technology such as AI, automation, heartland growth, Internet of Things, G5 wireless
- will volatile, AI robot-controlled ETF funds could cause a market crash – ETFs valuations trading is dictated more by the buying and selling of the funds, rather than by company’s own profit fundamentals?\
- do artificial intelligence systems really understand Trump and the new US-based markets?
- as international companies/economies fall, the desperate move to US markets will be intense
- how effective can the Democrats be in taking down US growth, small business growth, American consumer optimism, and tax benefits for US businesses, low rate business environment in the US, can they hide/downplay the dangers of moving business back to Asia?
- will the EU finally fall to pieces without tariff-free access to easy US markets and fend off China dumping?
- how much could inflation and high interest rates erode US GDP?
- how much will rising wages (forecast 4.8%) help improve demand for US goods/services?
- how much will the national deficit and trade deficits slow economic performance?
- is your financial/stock market advisor a democrat or republican?
Stock Market Forecast to 2020
The NASDAQ, DOW Jones, S&P and Russell 2000 indexes to 2019 from Tradingeconomics.
Old Market Forecasting Models Don’t Cut It
If the experts looked at their models more accurately, they’d see huge unfulfilled demand, disappearing regulations and drag on the US economy, tax and tariff positives in the US, technology cultural changes, confidence in jobs and higher wages, and an investor/US citizen base just about fed up with Democrat media reporting.
For instance investment experts liked SNAP, Amazon, Facebook, and disliked Tesla. How’s that advice looking right now? There are experts still advising investing in China companies. What does the technical and emotional indicators suggest how that will likely turn out?
US and global investors have plenty of tough questions about where to invest their 401k, and other retirement funds, and how to profit from all the turmoil going on, and whether traditional investing advice is wise during a Trump-lead market. These are uncertain and volatile times with the polarization of the Democrats and Republicans, and with multinational corporations trying to hold onto the old international trade system.
The stock market and economic experts aren’t taking into account political and emotional signals (emotional intelligence?) and not taking threats to US economic growth seriously enough. EU and China opposition along with Democrat media (creating negative events) can scare investors, even though the US economy is booming.
Stock Market Forecasts – Dow S&P NASDAQ
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* the above post includes opinions of the author and do not connote recommendations of any kind regarding stocks to invest in. The material is provided as information only.