The world economy has thrown the kitchen sink at President Trump's stock market rally, but so far nothing has been able to stop it.
The S&P 500 has gained 18.7 percent this year, even when traders demanded large swaths of geopolitical uncertainty and worrying financial data.
“The investment in the yield curve, US-China trade war, recession in Germany, collapse in Chinese industrial production, world performance contraction, oil price increase, BREXIT, Trump impeachment survey, Argentine standard / Ford downgrades / Thomas Cook bankruptcy … still risks assets near all-time highs and US stocks at a rate of 30 percent annual return, global stocks 24 percent, commodities 1[ads1]7 percent, global investment grade and high-yield bonds 14 percent, US Treasuries 10 percent … breathtaking stuff, "wrote Michael Hartnett, chief investment strategist for Bank of America Merrill Lynch in a note to clients on Friday, calling it a “miracle on Wall Street. ”
Trum p, who likes to use the stock market as a target card for his presidency, could not agree more with such sentiments.
“Do you think it was luck that got us into the best Stock Market and Economy in our history? "The president tweeted earlier this month. "It wasn't!"
The S&P 500 has gained 39 percent since it ended on November 8, 2016, helped by Trump's tax cuts and deregulation. The benchmark average has set 102 records since Election Day, and Bank of America predicts that the good times will continue to roll, at least for now.
"We remain irrationally bullish in 2019," analysts wrote. Not everyone is so sure.
Hubert de Barochez, a market economist at London-based Capital Economics, says that declining revenue growth could threaten the more than ten-year-old beef market, the longest in history. He sees the S&P 500 falling 15 percent through the turn of the year.
"We are not predicting a recession in the United States," he wrote. "But the manufacturing sector and the yield curve are sending worrying signals, and we believe the US economy will continue to slow down in the coming months. Furthermore, we expect growth in the rest of the world – where companies in the S&P 500 make up about 40 percent of revenue – still weak. ”
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