Market Drawdown Vs. Downturn: Watch The Fundamentals

Invesco US 3.42K Followers Follow Summary Market drawdowns have often reflected policy uncertainty, but they don’t necessarily signal the end of a market cycle. A meaningful downturn typically requires deteriorating fundamentals. Despite shifting interest rate expectations, tight credit spreads and strength in small-cap and equal-weight indexes support our view that the structural bull market has remained intact. Risks to watch include earnings disappointments, weaker policy guidance, and a slowdown in AI spending. For now, those warning signs haven’t appeared to materialize. pcess609/iStock via Getty Images By Brian Levitt, Chief Global Market Strategist and Head of Strategy & Insights I’m often asked when the next market drawdown will occur. An easy answer is soon enough. After all, 5-10% corrections happen in most years. This article was written by Invesco US 3.42K Followers Follow Invesco is an independent investment management firm dedicated to delivering an investment experience that helps people get more out of life.Be the first to know! Sign up for Invesco US Blog and get expert investment views as they post.Disclosure for all Invesco US articles: Before investing, carefully read the prospectus and/or summary prospectus and carefully consider the investment objectives, risks, charges and expenses. The information provided is for educational purposes only and does not constitute a recommendation of the suitability of any investment strategy for a particular investor. Invesco does not provide tax advice. The tax information contained herein is general and is not exhaustive by nature. Federal and state tax laws are complex and constantly changing. Investors should always consult their own legal or tax professional for information concerning their individual situation. The opinions expressed are those of the authors, are based on current market conditions and are subject to change without notice. These opinions may differ from those of other Invesco investment professionals. NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE All data provided by Invesco unless otherwise noted. Invesco Distributors, Inc. is the US distributor for Invesco Ltd.’s retail products and collective trust funds. Invesco Advisers, Inc. and other affiliated investment advisers mentioned provide investment advisory services and do not sell securities. Invesco Unit Investment Trusts are distributed by the sponsor, Invesco Capital Markets, Inc., and broker-dealers including Invesco Distributors, Inc. PowerShares® is a registered trademark of Invesco PowerShares Capital Management LLC (Invesco PowerShares). Each entity is an indirect, wholly owned subsidiary of Invesco Ltd. ©2015 Invesco Ltd. All rights reserved.