Time better spent

As rightly pointed out on Bloomberg in John Authers column, strategists’ year end targets for the S&P 500 have hardly moved over the last weeks. In the meantime, and thanks to the (geo)political and economic turbulences induced by Trump 2.0 , the investment landscape has fundamentally changed for equities. There is a great rotation out of Mag 7 stocks dragging the Nasdaq down 10.4% for the year. On the Old Continent, the DAX is up 13.3% y-t-d. The S&P 500 had a drawdown of more than 10% since its high three weeks ago meaning that we are technically in a “correction” zone for US equities. The well followed CNN Fear & Greed Index shows extreme fear. At ECP, we continue to do what we have always done. In periods of uncertainty we continue to focus on fundamentals of individual companies. We currently add to companies or invest into new quality companies where we believe the current valuation does not reflect their underlying earnings power. That is in our opinion time better spent than trying to forecast the S&P 500 for year end.