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‘Investing in stocks can be a pretty volatile affair’“These concerns may have now faded into the background, but are certainly not resolved and could therefore flare up again. Also, the market moves at the start of the year have acted as a wake-up call, demonstrating that investing in stocks can be a pretty volatile affair – another factor that will have reduced the allure of the asset class. Added to this is the ongoing deterioration of corporate profitability. This is evident in the earnings-per-share drawdown for the various regions in the MSCI Indices, compared to the highs reached up to this point.”
‘This was what you could call the traditional weak first quarter’“The second source of relief is related to the fact that the US economy did not slip into a recession, as some had feared. First-quarter GDP growth was weak (+0.8% p.a.), but by the looks of the most recent Atlanta Fed estimate for the second quarter (+2.5% p.a.), it looks as if this was what you could call the traditional weak first quarter.”