Bill Miller on market risk
Previously, we discussed billionaire value investor Bill Miller’s optimistic views on the equity market. He believes that improved earnings growth will boost the equity market.
He also shared that political risk is the biggest risk to the equity market this year, stating that “the greater risk to the market this year, in my opinion, is not economic, it is political.” Donald Trump announced on March 1 that the United States would be imposing import tariffs on steel and aluminum. On March 21, Trump announced that there would be import tariffs on Chinese products, raising concerns of a US-China trade war.
Major US indexes in March
The broader-market S&P 500 (SPY), the Dow Jones Industrial Average Index (DIA), and the NASDAQ Composite (QQQ) fell 2.7%, 3.7%, and 2.9%, respectively, in March as trade war tensions rose. The US missile attack on Syrian chemical weapon facilities in April and the expectation of a faster rate hike process from the Fed were also factors behind investor nervousness and the market correction. In the next part of this series, we’ll analyze Miller’s views on the market correction.