Are Markets Bouncing Back from a Recession?
There have been a great many signals over the past six to nine months that have convinced investors and analysts that the global economy had weakened and entered a period of slow growth, or even recessionary conditions:
- Reduction in consumer confidence that resulted in sluggish retail sales
- Oil prices diving to the lowest in recent years causing decreased exploration and a decrease in employment in such industries
- Investor sell-offs creating low share prices
- Enterprise earnings a lower than anticipated levels
- Chinese economy dragging that reduces demand for durable goods
Many investors have responded to these economic signals with a wait-and-see attitude to their investments, further exacerbating the condition. Wall Street’s start for 2016 did little to allay investors’ fears with the worst start for a year seen in recent history. Without investor and day trader participation in the market sluggish activity and concerns over market direction will ensue.
What Developments Indicate Recession Recovery is Imminent?
Over the past week reports have been more promising for investors. Analyst insight provides hope that the positive trends will continue, providing continuing optimism for economic recovery.
Retail reports indicated for a change that consumers are actually beginning to part with some of the money they’re saving at the gas pumps. Prior to the past week’s figures economists noted that the lower gas prices were not inspiring consumers to spend on other goods that would benefit retailers.
Crude oil prices are expected to stabilize. OPEC nations are indicating their intentions to throttle back production, which would likely have the impact of stopping the downward slide of that market, potentially even pushing the price up at least marginally. Such activity could have a ripple effect of making discovery efforts and alternative methods of extraction economically feasible again.
It’s all about profits, isn’t it? A return to corporate growth and more positive earnings results will boost investor confidence and trigger rising stock prices. Recent months have witnessed consecutive downward revisions of earnings expectations. Positive growth and forecasts will certainly pull investors out of the doldrums and back into a bull mindset.
China – while only time will provide concrete evidence of the turn-around of China’s depressed economic conditions, there is reason to hope for an end to the uncertainty that has plagued the world’s second-largest economy through internal policies and political pressure.
US Federal Reserve policies that were previously only being predicted or guessed at, have now been acted on and publicly discussed regarding their future direction. This provides some level of confidence regarding interest rates and their intended direction.
Day Trading through the Recession Recovery
As economic conditions change and recovery moves forward day traders that react quickly with actions based on real-time information have a distinct advantage. Utilizing reliable sources and sophisticated tools to determine the appropriate moves for your individual investment strategy require the services of an online broker who can facilitate your trade orders quickly and easily.
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Disclaimer: SureTrader Blog is not intended for U.S. persons. Stock information is not to be viewed as buy or sell recommendations.