Market Overview

Why The 1% Is Still Cautious About This Market

Why The 1% Is Still Cautious About This Market

The potential for a “great rotation” out of bonds and into stocks and the prospects for a favorable earnings environment in the United States in the coming years has many investors, including President Donald Trump, bullish on stocks. However, some of the wealthiest investors in the world still see plenty of reasons for caution.

Trump’s political unpredictability along with potential destabilization in Europe following the Brexit vote are two reasons Deutsche Bank AG CIO Christian Nolting believes wealthy investors remain uneasy.

“People are still cautious; there is still demand for bonds and people are not ready to move into the more risky equity space,” Nolting said.

Related Link: How Odds Of Trump's Impeachment Have Changed

Analysts at Citigroup and Goldman Sachs recently questioned the existence and potential impact of the great rotation.

“I, like many people, worry that there’s too much comfort right now and maybe some uncertainties are underestimated, particularly political ones, and as we get closer to some of those moments you’re likely to see spikes in volatility,” Credit Suisse Group CEO Tidjane Thiam explained. He predicts an uptick in market volatility in the near future.

Trump’s plans for lower corporate taxes and fewer regulations seem to present U.S. stocks with the best opportunity for growth that they’ve had in years. So far, the SPDR S&P 500 ETF Trust (NYSE: SPY) is up 9.5 percent since Election Day. However, nothing is ever a sure thing when it comes to investing, and the 1 percent it far from comfortable.

Posted-In: Brexit Christian NoltingAnalyst Color Broad U.S. Equity ETFs Politics Analyst Ratings ETFs General Best of Benzinga


Related Articles (SPY)

View Comments and Join the Discussion!

Latest Ratings

WWDWilliam BlairInitiates Coverage On0.0
HMSYGuggenheimInitiates Coverage On0.0
MDSOGuggenheimInitiates Coverage On92.0
HSICGuggenheimInitiates Coverage On72.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Trading Daily
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

One Last Flash Sale? Wells Fargo Weighs In On Kate Spade Takeover Talk

Stock Index Futures Trading Lower