The stock market may be swinging wildly after months of steady growth, but two top investment advisers said Thursday the bull market is far from dead.
“Do I think this is the end of the bull market? No,” said Michael Ryan, chief investment officer for the Americas for UBS Wealth Management.
“What we’re going through right now is growing pains. Overall the fundamentals remain very healthy,” Ryan added
“This concept of growing pains is spot on,” said John Tousley, managing director in market strategy for Goldman Sachs Asset Management. “The economy is fine. We’re not rolling over into a recession or a bear market.”
Ryan and Tousley spoke to a gathering of San Diego investors at the Lodge at Torrey Pines organized by the local office of UBS, the Swiss financial services company.
Both men said the recent volatility is normal; it was the long period of steady growth that was unusual.
“Last year, every single month for the S&P was higher. That had never happened before,” said Tousley.
Ryan said the major market pullbacks before 2017 were about downside worries — a double-dip recession, political gridlock and geopolitical danger — while the latest correction is about whether the economy is doing too well and overheating.
“As good as it was in 2017, it’s probably going to be a little more choppy this year,” he said. “What we’re experiencing right now is relatively normal.”
Both men said they were concerned about how the Federal Reserve handles the transition from abnormally low interest rates of the past decade to a more normal environment. And Ryan said a trade war or political shock could unexpectedly undermine the market.
But both stressed that the most important thing for investors is to build a strong portfolio and stick with an investment plan over the long haul.
“When you get caught up in the emotion of it, that’s when people make mistakes,” said Ryan.