By Leon Gettler >>
MARKETS will be booming right up until November next year, right to the lead up of the US presidential election, according financial analyst Rod North.
Rod North is the founder and managing director of Bourse Communications. Mr North has survived four market booms and busts and has worked in the financial services industry for 30 years.
He has very strong views about which way the markets will be heading next year.
He said the Australian market would perform well and the back drop to that will be the US market and the political cycle in America, with the election in November 2020.
“Donald Trump may be many things but he’s certainly a clever businessman when it comes to looking at how to position his best chance of being re-elected,” Mr North told Talking Business.
“So he will want the US economy to continue to power ahead. He will want unemployment to continue to stay low. He will probably want to see interest rates start to come off.
“All these things will mitigate towards a higher Dow Jones which is taking us beyond where it currently is at 27,000,” Mr North said.
“Into 2020, in the lead up to the US election next year, I think we will see some pretty powerful share markets and a lot of it is because investors have little space and movement as to where to put their money.”
Mr North said while the outlook for markets was looking up to next year, there was a question about what would happen after that.
“It’s probably 2021 we need to look out for, but I think the stars are aligning for a stronger market over the next 12 months and into 2020,” he said.
The big issue of course is what happens in the trade war with China.
Mr North said President Trump will try to resolve this, “simply because it’s in his best interests”.
“I do think from the US-China (perspective) Donald Trump will want to do a deal because he won’t want that not to occur in the lead up to the next election,” he said.
Me North said from Australia’s perspective, it would see China’s economy surpassing America’s in the next few years, and that would be a plus for Australia.
“The shifts of wealth are clearly to this region and Australia can benefit most from that,” he said.
“We’re in a hundred years of growth in this particular region. We’re in the same time zone, we can really benefit from that.
“We’re in the hundred years’ shift of wealth to the Asia Pacific region, Australia can really benefit from that.”
Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness.