Sonders Says Recession Risk is Low

Although there are those that believe the U.S. is on the brink of recession, Liz Ann Sonders, Charles Schwab’s chief investment strategist, says the risk is low. This according to CNBC’s report on her commentary at the Morningstar ETF Conference in Chicago earlier this month. While Sonders says there are no clear buy signals at present, the market “could continue to grind higher, but not without drama. An ongoing secular bull market is still a decent bet.” While admitting that our economy is in turmoil, she differentiates between an economic recession and an earnings recession—what we’re facing now—which was caused […]

Sonders: Market Most Likely in Post-Echo Bull Phase

Liz Ann Sonders, chief strategist for Charles Schwab, outlines the four phases of the stock market over a full market cycle. Since 1960, the market can be seen following the four distinct periods: recession bear, post-recession bull, echo bear and post-echo bull. Recession Bear: these are the big bear markets, usually lasting a few years and averaging declines of 30%. The 2007-2009 bear market, as Sonders points out, fell by 54% so that was a much larger loss than after. Post Recession Bull: this is the immediate 1-2 years following the bear market. There tends to be a large snapback […]

Charles Schwab CIO Liz Ann Sonders Sees the Market Within a Bull Pattern

Liz Ann Sonders of Charles Schwab offered a cautiously bullish analysis of the market at the recent Inside ETFs conference. She cited Sir John Templeton’s statement that “bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria.” She sees the current market in the “mature” phase of the bull cycle. “I don’t want to dismiss any of the concerns out there about the global economy, but if you look at the data, it’s not as bad as the doom-and-gloomers suggest,” she said, placing the risk of a U.S. recession at about 25%. Regarding China, […]

Volatility and Investor Behavior in Today’s Uncertain Market

The PBS Newshour reports on recent market volatility, noting a series of contributing events. Liz Ann Sonders of Charles Schwab said, “a lot of [the current volatility] really is unfisnished business from 2015, it’s just conspired to occur in a condensed period of time, unfortunately at the beginning of the year, which I think adds to the angst of investors.” She also noted, “we do not think this is the beginning of a big nasty bear market, but it could get worse before it gets better.” Further, she opined that the financial crisis, coming within a decade of the prior […]

5 Signs of a Surviving Bull Market, Says Schwab’s Sonders

Liz Ann Sonders, chief investment strategist with Schwab, believes the bull market will continue. She points to: The lack of new net inflows into equity mutual funds (unprecedented in a bull market like the current one); The S&P has crossed its 50-day moving average more than 50 times so far this year (much higher than earlier in the bull market); Stock buybacks may be supporting rises in stock prices; The Fed is signaling a slow tightening of interest rates, which historical data suggests produces higher returns than a fast tightening; The economy has added 13.5 million jobs since the financial […]