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Investment opportunities in US equities

Investment opportunities in US equities

Category: Investments

Updated: 31/10/2008
First Published: 31/10/2008

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Garrett Fish, manager of the JPMorgan American Investment Trust, says there is a good case in favour of investing in US equities.

As current political and economic events turn the World's attention to the country, Garrett Fish says some US large cap stocks are showing desirable investment entry levels.

Fish said, "History has shown that during times of severe stress in the markets there are decent buying opportunities. As the US economy has slowed and consumer confidence, housing, economic growth and auto sales have hit multi year or near multi year lows, US equities are looking reasonably priced."

Speaking about news of a US recession and the impact of a new president on financial markets he said, "It is important to understand that financial markets have already heavily priced in economic and political impacts, for example while there are good buying opportunities we are already forecasting slower earnings growth."

Fish expects to see further weakness for the global economy but pointed out that inflationary pressure is normally reduced in low growth or recession environments.

Within the JPMorgan American Investment Trust the largest contributors to investment performance during September were in technology and financials. Within the top ten holdings, four are information technology stocks, including IBM, Hewlett Packard, Microsoft and Oracle, which comprise just over 9% of the portfolio.

In the last twelve months (to 30.09.08) the investment trust's share price has returned -9.0%, while the NAV was -6.3% and the benchmark, the S&P 500 index, returned -11.1% for the same period. Over three years the benchmark was -1.1%, while the share price appreciated 5.6% and the NAV 4.6%.

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