Stock Markets Poised for Takeoff

The recent correction in global stock markets have brought stock prices to attractive levels given the strengthening economies around the world. The tax cuts enacted recently in the United States are going to help earnings growth for corporations and with economic growth continuing in the United States companies will be able to report much higher levels of earnings. The European Union is finally experiencing better rates of growth and with China growing steadily because of higher personal consumption the global economy is poised for a good year in 2018.

The recent correction over the past few weeks comes at a time when the stock markets climbed steadily for a long time without a reversal which makes investors cautious. So the correction had little to do with any economic calamity but more to do with a balancing of the market from an overbought position. Investors were becoming too complacent as economic growth is accelerating and stock prices in many sectors were rising steadily. Therefore the decline was necessary and healthy for global stock markets taking prices from levels too high to levels slightly above fundamentals.

I do not believe that we are going to see prices at inexpensive levels because the global economy is performing well and should continue growing for the medium term. I think with this correction most of downturn has taken place and prices are likely to resume their appreciating trend from here. So like cryptocurrencies, I think stocks represent a great investment opportunity right now as they are poised to march higher for the rest of 2018. There will be much wealth created this year as equity values grow along with the improving economic climate I see envolding.