Given the economic outlook, and recognizing the time it takes for policy actions to affect future economic outcomes. The US market may have mixed view as few fund houses who exited well before the Fed rate hike decision will now look for attractive bond options and better yield prospects; where as few investor would take Fed hike as a bullish sign on the economic frontier and reiterate their confidence in US stock markets at the same time be selective in their investment decision as well as horizon.
To add further Yesterday (17th Dec) the crude prices were once again on the down trend with the rise in US dollar index and base metal & precious metals also witness some heave profit booking dragging the counter towards their respective monthly low. Especially lot of investors/analyst predicting the international gold prices to go below $1000 very soon.
Most of the investor with Christmas fever sinking in will prefer to liquidate their funds; to top it up Dollar index will push the Treasury bond yield also to much attractive levels and thus shift of paradigm from equity to bonds could be visible in the US markets as well.
Please note:
Yesterday few of the US mid-cap heavy weight like Caterpillar Inc, Chevron Corporation witnessed 3-4% correction on the event of profit booking and metal companies like Freeport Mc Moran copper & gold saw correction of 8%.
We expect such trend to continue and hence suggested the over all trend for US market could be sluggish till Christmas season.
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