By Barbara Kollmeyer, MarketWatch
AFP via Getty Images
Markets enter a new week clinging to hopes that a “Phase 1” trade deal between the U.S. and China will hold together.
Analysts note that some sticking points and questions surround the tentative trade agreement, and cautious optimism seems the byword for Monday as stock futures creep higher.
It’s been a pretty rewarding year for many investors, and no one wants that derailed at the last minute by trade hiccups. Double-digit percentage gains for stock markets aren’t just limited to the U.S., with Europe and parts of emerging and Asian markets also having enjoyed a solid year.
Think international going forward, says our call of the day from Raj Sharma, a private wealth adviser at Merrill Private Wealth Management. He’s been on Barron’s list of America’s Top Financial Advisors for 16 straight years through to 2019, and can also be found on Forbes’s 2019 Top 100 U.S. Wealth Advisors.
“The emerging consumer is a very durable investment theme,” says Sharma, who notes that the developed world’s population is shrinking and getting older, but emerging markets hold huge opportunity given the vast numbers of younger people.
He points out that India has over 1.2 billion people and 65% of the nation is under 35 years old. Investors can do well in these markets by figuring out what those consumers need to improve their lifestyles, and the items they will buy, such as billions of cars, he says.
“To do well consistently over time you have to be a bit contrarian in the way you look at things. If you always follow the hard dot, you’re likely to be disappointed,” Sharma says, noting that international stocks and emerging markets are selling at over a 30% discount to the U.S.
The Dow /zigman2/quotes/210598065/realtime DJIA -4.42% , S&P /zigman2/quotes/210599714/realtime SPX -4.42% and Nasdaq Composite /zigman2/quotes/210598365/realtime COMP -4.61% , while European stocks /zigman2/quotes/210599654/delayed XX:SXXP -3.75% have surged and Asian markets /zigman2/quotes/211618636/realtime XX:ADOW -0.51% had a mixed day. The dollar /zigman2/quotes/210598269/delayed DXY -0.56% is weak and the British pound /zigman2/quotes/210561263/realtime/sampled GBPUSD -0.1085% is up after last week’s victory for the Conservative Party.
Our chart from Jeff Desjardins, editor of the Visual Capitalist blog , shows the S&P 500 /zigman2/quotes/210599714/realtime SPX -4.42% over the past 30 years, using data from Macrotrends . “If you invested $100 in the U.S. market on November 26, 1990, you would have over $1,000 today,” he notes.
Shares of PG&E /zigman2/quotes/202583141/composite PCG -2.33% are down over 20% as Gov. Gavin Newsom of California demands changes to the utility’s plan to pay wildfire victims and exit bankruptcy.
Food flavoring group International Flavors & Fragrances /zigman2/quotes/206698429/composite IFF -0.98% is merging with conglomerate DuPont’s /zigman2/quotes/203606582/composite DD -4.02% nutrition unit in a $26.2 billion deal.