WAVERTON – THE RECENT MARKET DOWNTURN

The market sell-off that began in earnest on Friday 2 February appears initially to have been an adjustment of investor sentiment. Particularly since the passage of significant tax cuts in the US in December 2017, the consensus view of the outlook for 2018 had become rather bullish. Economic growth has been strengthening around the world and corporations have been able to generate significant earnings growth. The cuts to corporate tax rates in the US have turbo-charged the already strong earnings picture.