NEWSLETTER
During the last decade, the S&P 500 He has been the undisputed king of global values markets. Fed by the meteoric rise of US technological giants such as Apple, Microsoft and NvidiaThe index has delivered impressive yields. But is your reign coming to an end?
The US market is expensive, disruptive threats are emerging and we now have a possible commercial war in our hands.
The S&P 500 quotes a price ratio to Shiller (P/E) cyclically adjusted from just over 38. That is more than double its long -term average of approximately 16. It has only been higher once before, During Dotcom's boom. 1999.
Can the United States stock market really fail?
High assessments are not always a problem. Investors are happy to pay a cousin for companies with strong growth prospects.
But leave less space for error. If corporate gains disappoint or growth slows down, we could see a strong correction.
Then there is the story of ai, which has raised the United States rally to the next level. Chatgpt and other generative tools of ai consolidated the opinion that the United States would dominate this transformative technology.
Then China's deep Seek shook. It seems capable of similar work for a price fraction.
Deepseek will undermine mega-caps as NVIDIA, or increase demand and drive them even more. We still don't know.
Then there is politics (there is not always). President Donald Trump's rates could trigger a global commercial war.
Many of the largest companies on S&P 500 depend largely on international sales. If Trump's objectives retaliate, their profits could receive a blow.
One possibility is that investors begin to look beyond the S&P 500 for opportunities. Enter the Ftse 100.
The United Kingdom's flagship index has been eclipsed by its US counterpart, but has different advantages. First, it is cheap, the profits are quoted around 15 times. That offers some risk protection if the markets become sour, although there is no guarantee that it does not like.
The Ftse 100 could now be a winner
Second, the FTSE 100 is full of high quality dividends shares. Companies like Astrazeneca, Shell and Uneilever Have a long history of rewarding shareholders with constant and reliable payments.
Global Asset Manager Schroders (LSE: SDR) It often flies under the radar, but it is worth considering. Their actions have had problems lately, falling 13% for 12 months and 35% in five years. However, they have now jumped 10% in the last month.
Schroders has a stellar performance of just over 6%. Their dividends will be even more attractive as the interest rates of the United Kingdom fall and produce them cash and the bond slide. And it still looks good with a p/e of about 14 times the profits.
He faces a great threat. With a strong £ 777 billion net assets under administration, it has good reasons to fear a commercial war. Those assets could be beating if things become unpleasant.
The United Kingdom faces its own challenges, from slow growth to persistent inflation. But as the S&P 500 Wobbles, more investors can consider diversifying in defensive actions and paying income in the United Kingdom.
The US market is not convicted, but investors can step on more care. Has the S&P 500 had its day? Maybe not, but their glory days could end for now.
Does the publication have the S&P 500 overvalued had its day? He appeared first at the Motley Fool UK.
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Harvey Jones has positions in Nvidia and Unilever. The Motley Fool UK has recommended Apple, Astrazeneca PLC, Microsoft, Nvidia, Schroders PLC and Unilever. The opinions expressed in the companies mentioned in this article are those of the writer and, therefore, may differ from the official recommendations we make in our subscription services, as an action advisor, hidden winners and Pro. Here in The Motley Fool we believe than considering a wide range of ideas makes us better investors.
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