Next year 2017 presents itself with greater uncertainties than ever. With a series of events that can take international equities to lows, if not historical ones, at least in recent years. Invest the savings, in any case, it will be much more complicated than in the past years. To the point that security will be one of the most precious values that you have to take care of in your operations on the stock market.
Some of the scenarios that can be generated will be completely new. But others do not, but on the contrary, they have been latent in the financial panorama for some years and can reappear from any moment. You will have no choice but to pay special attention to them with the purpose that you do not take no negative surprise from these moments.
The stock market will depend on these events in the next twelve months. In an intensity that will be marked by the importance it can bring to financial markets. A good part of them are of an economic nature, but also political and even social. In any case there is one thing for sure and that is that this year you will not get bored under any circumstances if you opt for investing in the stock market.
Events: rate hikes
The financial markets will be very attentive to the decisions made by the European Central Bank (ECB) on their monetary politics. Especially everything that has to do with a change in interest rates. It cannot be ruled out in any way that this year there will be a rise in interest rates. If it occurs, the reaction in European equities could be clearly bearish. Even to be immersed in a process of long-term falls.
Banks would be the values most affected by the application of this measure. With the possibility that they could have some very strong depreciations in their prices. Of course, above other stock sectors. You should, therefore, be very prudent when opening positions in the stock market, since if you do so in this important sector, you may have serious problems with your portfolio.
Of all of them, the rate hike, if generated, would be gradual and would become more visible with the year 2017 well advanced. Preferably in the last two quarters. There will be no choice but undervalue this sector in order to protect you from the possible consequences that it may have on your quotes. From the positive side, it would help you to buy their shares for more competitive prices than now.
Nor can you forget the ones that can pass to the other side of the ocean. Where it seems clearer than the Federal Reserve of the United States carry out this monetary strategy more regularly. In which case, it would not affect financial markets as much as if it occurs in the old continent. But what should not be forgotten is that interest rates will play a very decisive role in the future of the stock markets in the coming years.
2017: key elections in Europe
The electoral appointments will be a new scenario that is presented during 2017. They will be held in France and Germany, among the most relevant countries in the international economy. To the point, these commissions are important, and they can be winners of the same parties or movements openly against the euro and the project of European unity. You should also assess this possibility, which may be real.
If this scenario occurs, of course the bags would fall with great force. To levels never seen before, perhaps. This option will allow the volatility is installed strongly in the stock indices of the old continent. Even with unusual force, where the sellers would clearly prevail over the buyers. Giving up on your illusions of optimally making your personal assets profitable.
Another scenario that may arise from now on is that popular consultations take place in some countries. In order to promote their departure from the community bodies. Also would be interpreted very negatively by investors. With the more than evident risk of a collapse in the equity markets. To avoid this complicated scenario, it would be highly advisable that you opt for other alternative financial assets.
The phenomenon of terrorism
Another event that can lead the stock markets to a very sharp downward trend is the appearance again of terrorist attacks on European soil as a result of Islamist groups. It will be a very hard blow for all bags. With depreciations in sectors as strategic as tourism, transport, cyclical values and maybe even banking. Either way, these events are something that you cannot foresee in any way. Nor will any kind of investment strategies be worth it.
The only way to avoid this is by not taking excessive positions in the stocks or equity sectors most vulnerable to these highly objectionable events. It is true that the cuts in their prices may be rather specific, but very intense in terms of their virulence. Where the best strategy will be to be outside the financial markets. At least those considered traditional. The safe haven securities and assets must become the main destination of your contributions.
It is a scenario that can be planted at any time and without prior notice. You should be prepared for correctly rotate your investment portfolio. Because in effect, it could seriously harm your interests. And the best way to get out of this situation is planning it through real alternatives where your money is much safer at those times.
Lower economic growth
Another factor that will greatly affect the evolution of the stock market during this year is that the results on growth are worse than expected. It will be another of the triggers for the bags to suffer more fall. Perhaps irreversibly unlike the other events that we are exposing to you in this article. A clue about what may happen in the main economies of the world will come from the reports that the main economic organizations will prepare. Among them, those from the World Bank or International Monetary Fund, among the most important.
Any downward reduction in economic growth will be interpreted as an obvious sign of weakness that will propel the actions towards lower levels in their quotation. This is a scenario that you cannot rule out under any circumstances. Even certain highly regarded analysts believe that this is really going to happen. It will also invoice your investments in the stock market. Perhaps with greater intensity than in other different scenarios.
You must be very attentive to business accounts of Spanish companies, to check their evolution. So that in this way, you can exit the financial markets early. And avoid additional falls in any of these stock market proposals. Not in vain, here you will have it easier. The reason is none other than that listed companies are required to present their results every quarter. Depending on them, they may vary in one way or another.
The importance of inflation
As always, this economic parameter is another element that determines the state of financial markets. Although to a lesser extent, as a consequence of a greater price control through the monetary policies of the great economic areas. But still, you will not be able to forget this information if you want to invest your savings in the stock market. Even in other financial assets of an alternative nature.
You will have to know that the inflation data is very important to determine the rise or fall of interest rates. And with this, any deviation from the objectives set by the governments becomes more relevant. Of course, they will not be the cause of large falls in equities. But if at least so that they can make you lose more euros than necessary in any kind of operations that you open in the financial markets.
You cannot underestimate inflation, as it can give you the ultimate clue to where your savings should be directed over the next year. That will be the true value that you must grant to this economic data when planning your movements in the equity markets. In this sense, it can become an element of great help to defend your interests at any given time.
These are roughly all the events that can bring down the stock markets around the world as of January. You must keep them in mind and if you can get ahead of events, better. It will be the best strategy you have to protect your interests as a small investor that you are. Through very cautious movements that know how to live with the volatility that the financial markets will show.
Because indeed, the fluctuations of the prices of the actions in this period will be very strong. Favoring the interests of speculators, by having greater margins to carry out their stock market operations. With a strong divergence between its maximum and minimum prices in the same trading session. If this is your preference, you will be in luck since next year will give you many opportunities to operate in this way.
What does not seem to be repeated is that of a side stage as he has lived during these last months. Where it has been very difficult to formalize any order, both buy and sell. This will surely change to a more dynamic market that will offer you various investment proposals.