US Market review May 2019


US Market review May 2019


Published Date: 2019-05-10 | Source: INCE|Community | Author: Bruce Ingram

US Market review May 2019

The original scope of SharePicksUSA articles was for each article to cover a specific share. As I am struggling to find deep value Blue Chip shares in the currently overvalued US market to recommend, I am going to widen the scope of my content.

In addition to writing on shares to buy and sell I will also be discussing my view of the US market, shares to hold as well as commenting on recent developments with listed US companies that may be of interest.
Current state of the US stock markets.

April saw the S&P 500 provide a total $ return of 4.09% and a fantastic performance of 18.16% year to date. Analysts have been expecting first quarter earnings to decline resulting in a market decline. However, with over half of the S&P 500 companies reporting first quarter earnings to date, the earnings are up 0.7% instead of a forecast 2.5% decline. 

The US markets are once again hitting all-time highs, with the S&P 500 having an overall P/E in the region of 18, the long-term average is about 15. Currently share prices are growing faster than earnings, driving higher P/E's.

Now may not be the best time to invest in the US market unless you can find undervalued Blue-Chip shares. It may also be prudent to consider selling your overpriced holdings, bank profits and keep some ready cash available to reinvest, investments should the market decline or a good buying opportunity arise.

I am not suggesting that you get out of the market. Remember it is the time that you are invested in the market, not timing the market, that provides long term growth. The US share market has grown an average of 7.8% since 1950. 

An analysis of the S&P 500 shows that there has never been a loss recorded over a 15-year rolling average since 1950. The S&P 500's worst performance over a 15-year period has been 3.7% and a best performance of 20% 

I came across this interesting graph comparing the % gain of the S&P 500 from the day of inauguration between Trump and Obama..

Disclaimer: Please note I am not a registered Financial Planner. The articles I write are based on my personal research and for my own use. Before purchasing any shares, you must do your own research.