With one tweet, he sent Toyota shares lower. With another tweet, he sent the shares of major pharmaceutical companies lower. With yet another tweet, Boeing shares dipped. Millions of shareholder value, wiped out just like that.
Welcome to post US President Donald Trump’s US stock markets where a single tweet from Donald’s fingers, loosely connected to a brain that alternates between hallucination and facts, invites instant kneejerk reaction, whether warranted or not. It appears that no company is spared. Perhaps negative opinions on companies or sectors where he has vested interest in, will be treated more kindly.
With no bigger brand ambassador than Donald for Twitter, Twitter has scored an unintended coup. Maybe, folks who are hesitant about using Twitter will now be more willing to try this instant messaging platform. Unfortunately, Twitter is still languishing below US$20, well below its high of US$74.73. Even with the endorsement of the most powerful president in the world, Twitter still cannot convince the market of its profitability and future growth. Twitter continues to bleed quarter after quarter.
Donald’s unpredictable tweets will be the curveball you will have to live with as you stay invested in the US stock market in 2017 and beyond. No one knows if all his grand plans of bringing jobs back to US will materialize. No one knows if his protectionist rhetoric will cause the US dollar to weaken as he thinks that a stronger US dollar has been disadvantageous to US exports.
A few things are sure for 2017 though. More corporate merger and acquisition will happen, especially in the oil & gas and pharmaceutical sector. You will strike a home-run jackpot if you have shares in to-be acquired companies. Good large cap companies like Amazon and Google will continue to grow, innovate and reward shareholders. Smaller cap profitable gems are a-plenty too. Stay invested, nimble and watch out for currency fluctuations that might lower your profits should the Singdollar strengthen against the US dollar. Take profits regularly. Money ain’t yours till it’s safe in your pocket.
Whatever you do, be decisive and don’t get Terrex(ed), meaning “Stuck”.
Have an exciting year of the Rooster!
Empower Advisory Team