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By Malcolm Stacey | Saturday 7 July 2018
Disclosure: I own shares in one or more of the stocks mentioned. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
Hello Share Twiddlers. Despite the worries of an uncertain world, economically speaking, there have been some jolly signs recently that share prices could move ahead. I know there are warning signals out there to counter any undue optimism, but they don’t seem to be having an effect, do they?
There is a view (not widely held, I grant you) that, though all the underlying threats, like corporate and private debt, Brexit and low wages have not gone away, the big financial movers on the planet won't allow crashes, like the 2008 banking rout, to happen again.
This is an evermore sophisticated world, gang. And we are learning to bend the laws of economics to our advantage. Yes, it’s highly likely that another recession will come some time, but vested financial interests are finding more and more ways to kick the threat down the road.
Meanwhile, as the Footsie continues to trend upwards, we should make hay while the sun shines. Literally, at the moment. One worry is American trade tariffs. But moves are being made by the US to placate Germany and these steps towards trade reconciliation should spread to other countries, including our own.
Yes, America and China are now fighting tooth and nail. But that can only help our exports, as China is more likely to buy from us to make up an American shortfall.
Meanwhile, Bank of England boss Carney has said that he thinks the poor growth in the first quarter of 2018 was now due to the snowy weather. And now we have wall-to-wall sunshine, we have doubtless been spending heavily again.
In fact, Carney confirmed this, saying both spending and sentiment have already ‘bounced back strongly’. That will probably mean interest rates will rise again in August. But I don't think that will slow down share prices.
Ok, if I’m not selling any shares, which ones should I buy. Well, miners are making a comeback. I favour Glencore (GLEN) BHP Billiton (BLT) and Rio Tinto (RIO).
When I’m not in the Punter’s Return. God bless.
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