The stock market is on everyone’s minds this December, and rightly so. With the ongoing pandemic still wreaking havoc across the globe, investors have reason to be concerned about the near-term future of the markets. According to a recent report from GodzillaNewz, there is a high risk of a market downside in December.
The report cites a number of factors that could contribute to a market decline in the coming month. Chief among these is the expiration of government stimulus programs and the subsequent economic uncertainty that may follow their departure. Further, the fallout of the pandemic has ushered in an era of hard cuts among companies that have been struggling to remain afloat, resulting in extended fears of job losses and economic pain.
In addition to these economic considerations, geopolitical tensions will also play a role in the stock market’s performance in December. Tensions in the Middle East, tensions between the U.S. and China, and even continued Brexit negotiations could serve to ramp up volatility in the markets and create further downside risk.
China’s ongoing challenge to the U.S.’s P5+1 nuclear deal and its increasingly confrontational stance against India could destabilize the region at a time when tensions are already high. Additionally, the ongoing war in Ukraine and the increased U.S. presence in the South China Sea could contribute to further disruption in global markets.
The report also suggests that U.S. investors will have to pay close attention to the Federal Reserve’s policies and decisions that may have an impact on the markets. Specifically, any changes to the interest rate or any new quantitative easing policies could have an impact on markets around the world.
Though the forecast for December looks bleak, investors should take heart that there are several positive trends developing in the market. Vaccine developments, an increased focus on renewable energies, and signs of a global economic recovery are all strong bullish signals that could help the stock market recover in the coming months.
In the end, it is important for investors to pay close attention to the news and economic news coming out of Washington and around the world. It is also important to remain vigilant in monitoring the markets and understanding the potential impact of geopolitical events. By doing so, investors can continue to remain informed and prepared for whatever the future holds.
