By MARGARET HAYES and JILL BECKMAN | 04/02/2018 04:55:25The market for U.s. stocks has been in a state of uncertainty for years.
But now, analysts say, the market is likely to be in for another shake-up, this time by an unexpected force.
The dollar could be weak again, which could drive up the price of stocks in the U.K. and Germany, as well as a drop in oil prices.
And then there’s Brexit, a possibility the Brexit vote could force the United States to make a hard choice between remaining in the European Union or pulling out of the trading bloc.
“The U.k. has a big economy, but its exports are heavily dependent on its European trading partners,” said Stephen Langer, chief investment officer at Pimco.
“Brexit could force them to make tough choices.”
stock market has been under pressure since the election of President Donald Trump, who campaigned on a pledge to make U. S. companies more competitive.
He has promised to pull out of trade deals like the North American Free Trade Agreement and the Trans-Pacific Partnership, a free trade agreement that includes the United Kingdom.
The market has reacted with an extraordinary amount of volatility in recent weeks.
It has plunged by more than 20% since Election Day, according to data from the U of T’s Institute for Supply Management.
And in January, the S&P 500 and Nasdaq composite plunged by nearly 10% each, triggering fresh stock market losses.
Some investors have already priced in another shock: a weaker-than-expected economic outlook, which means they are now looking at a potential sell-off.
Investors are also worried that the European Central Bank may tighten its grip on monetary policy, which has hurt U.B.
Os. stock prices in the past.
The bank has also been trying to prop up the euro, which is now trading at $1.08.
For now, investors are focused on the UBS-Merrill Lynch index, which tracks the S &M global equities market.
The index has declined 10.5% this year.
“This is an important milestone in our macroeconomic history, and we are extremely encouraged by the direction that things are trending in the United U. K.,” said Michael Pachter, chief market strategist at UBS.
In the U., stocks have dropped more than 1% over the past month.
The S&s have fallen 6.5%.
“There is no doubt that a big shock to U. s. equity markets is coming,” said Andrew Lutz, chief global strategist at PWC.
“The market is moving in the wrong direction, and this has nothing to do with the Brexit or Trump.”
Still, many investors say the market may not be in as bad shape as some analysts would like.
For example, the PIMCO index of the U, S &s has gained 1.5%, which would be its highest gain since late 2015.
The U. and S&ams have also climbed by 2.2% this month, their best gains in three years.
“I am not expecting a massive selloff, but the market will be in the red for the next couple of years,” said Richard Meeks, an analyst at U.F.
L Financial Services.
For some investors, the shock of Brexit has not made a dent in their buying, according of data from BMO Capital Markets.
The Dow Jones industrial average gained 18.1 points, or 1.6%, to 22,859.60 on Monday, the Nasdaq added 1.2%, and the S.&.s gained 0.7%.
Bonds index, the benchmark for long-term government bonds, rose 0.6%.