USA’s Market Outlook
The US S&P500 index continues to create new highs with technology stocks and President Trump’s tax reform expectations as main drivers in 2017. Moving forward into 2018, when Janet Yellen steps down, investors will be keeping a close watch on the new Federal Reserve chairman and his stance on US interest rates. If the committee takes a dovish view on US economy, investors can expect a slower pace in the interest rate hike cycle. When this happens, US S&P500 futures will most likely continue its bull run into the first quarter of 2018.
UK’s Market Outlook
With UK already facing strong headwinds in its Brexit negotiation, news of Prime Minister Theresa May being urged to step down seemed to worsen the situation, causing the FTSE100 index futures to fall in recent weeks. But as investors eagerly await details of Brexit’s finalisation before taking action, the index is expected to bottom out by end of 2017 with periods of price consolidation expected in early 2018.
Europe’s Market Outlook
European stock index futures e.g. the EURO STOXX 50 are weighed down by issues such as political uncertainty in Germany, the Catalonia crisis and the potential impact that Brexit may have on Europe’s economy. If these risks remain for a prolonged period of time without resolution, investors may start moving funds out of European markets. This will result in a potential sell down in the European equity indices as early as 1st quarter of 2018.