Radford Taylor Partners - Market Tremors as Stocks End 2018 in Turmoil

Radford Taylor Partners - Global equities flirt with bear market territory as perfect storm of headwinds drain confidence.

Radford Taylor Partners - Investors’ nerves have been left frayed by whipsaw price action on the world’s equity markets as a wave of volatility sparked by a cocktail of headwinds erased most of the year’s gains.

Typically, the month of December is a model of benign stock market activity with investors – private and institutional alike – looking forward to what is cheerfully referred to as a “Santa Rally” in which stocks have one last surge to cap off a good year. 2018’s failed to materialize as first the US benchmark indices, the Dow Jones Industrial Average and the S&P500, plunged precipitously. They were followed by Japan’s Nikkei 225 which shed close to 5,000 of its 24,000 points in a wave of selling redolent of the 2008 financial crisis.

In an unscheduled note to investors, Radford Taylor Partners analysts say there is strong support for stocks at key levels which have held well despite the wave of selling seen during the last few trading sessions of the year. They caution, however, that – certainly in US markets – this support is likely coming from the major banks that Treasury Secretary Steven Mnuchin spoke to in the wake of a 600-plus point fall in the Dow before Christmas.

The Taipei, Taiwan-based investment boutique believes that the Treasury Secretary wanted to ensure that the banks supported stocks by stepping in to buy because US President, Donald Trump has much of his political capital tied up in the performance of the stock market and the perception that his presidency has had a positive impact of American prosperity.  

Radford Taylor Partners has told clients to expect volatility to continue into the new year as concerns deepen over the US-China trade war, the US Federal Reserve’s monetary tightening trajectory and slowing global economic growth.

Source: Radford Taylor Partners