Stock Market Forecast: Will Trade War Spoil A Strong First Half Of 2019?

After stocks’ seemingly strong start to the year and minor correction in May, investors have reason to be satisfied with the market’s 2019 performance. But by some measures, the stock market is lagging after shaking off the Q4 bear market. And trade wars and interest rates remain huge risks that loom large in the stock market forecast for the next six months.

The trade standoff between President Trump and Chinese President Xi Jinping weighs heavily on the stock market outlook for the rest of 2019. (Nils Davey)

As the second half of 2019 starts, trade troubles still gnaw at investors. President Donald Trump said Tuesday he will have an extended meeting with Chinese President Xi Jinping this month. But the issue is clouded with uncertainty. Barely a month ago, Trump threatened tariffs on Mexican imports, not because of trade issues but rather immigration control.

Investors hope the Federal Reserve will cut interest rates in the second half of the year to offset the effects of a tariff outbreak. Stocks are rising again on favorable chances for at least a couple of interest-rate cuts.

What can we expect in the next six months of 2019?

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