The word ‘predictions’ is normally associated with astrology. If astrological predications could lead to good investments and profits, most of the stock brokers would be out of business. Both have a role to play and they carry out their respective assignments to the best of their professional ability, calculations and judgments.
The discussion about the stocks, throughout the year 2100, is centered on recession and its after-effects. The government-engineered recovery efforts are in the limelight. 2011 is expected to be a good year for stock. All those who are concerned with the stock market know well that the market authors its own syllabus and its moods are unpredictable. Majority of the analysts, see that in 2011 the stock sapling will sprout and grow again when the sustainable economic recovery takes root. A new confidence is seen with both the companies and consumers and they are willing to trust each other. Low interest rate augurs well for the corporate profits. Central Bank is watching the situation carefully. Analysts also know that more than one major factor have the inherent strength to influence the positive trends. Stock market gains are expected to rise from 7 to 17% in the next year. But there are many ifs and buts to thwart this happy position.
The challenges in USA
The investor has to challenge the global market. Escalating trade tensions can put a break on the growth. The economies of many countries may have to tighten the credit, causing issues. Conflicts with Iran and the challenge from Korean peninsula may cause untold miseries to the stock trade. The major political problems anywhere in the world can topple the smooth functioning of the stock market, and the global asset allocation may go haywire. Job market is another thaw. Unemployment is already about 10%, and the consequences, if it increases further, would not be to anybody’s liking. A serious political issue may develop with fallout in economics of consumer demand and set forth a chain reaction. Idle labor is the greatest liability for the economy of any country.
The backlash of the recession has been beneficial in some areas. Cost-cutting during the recession, not hiring additional hands boosted profit margins and the S& P companies earned a weighted average of $ 85 per share, an increase of $21 as compared to the figure of $64 in 2009. The beneficial trend will continue. Bank losses are expected to shrink from 2.6% in 2010 to 1.8% in 2011. In these favorable indicators, all-round growth of S&P companies is almost certain.
That which is bad for the Planet Earth as a whole, cannot be good for the stock market. According to Nostradamus, in 2011-2012 increase in earthquakes and volcanoes in the world is round the corner. A possible North-South Korean Nuclear War is not ruled out. Epidemics will afflict the humanity on a big scale.
According to astro-predictions, high volatility in currencies and bullion market is expected at international spot and futures market. The world stock markets are also in for the high pitch. The outlook for Indian stock market is positive. European stock markets may not fare better as compared to Asian and American markets.
Brazil, China, Korea and Russia should do well. Middle East countries will suffer from geo-political tensions after May 2011 and this may have bearing on the oil market. Bullion and metals will do well as compared to agro commodities and good annual return is expected from the stocks/investment in for former.
Sensex is due for upward movement and may touch 24000 by the end of the year 2011. By March it may reach the level of 22000. Some good sectors to invest are banking, education, heavy engineering, metals and infrastructure. Investment in silver is likely to yield very good dividends. India will have a GDP growth of 9% during the year 2011-2012.