Byron Wein’s 10 Stock Market Investment Surprises

The BlackStone strategist published his annual list of 10 potential surprises for the coming year, plus five runners up. Byron Wein emphasizes that these aren’t predictions of what will happen. These are events most people discount but that he thinks have at least a 50% probability of occurring. It’s interesting reading every year. He reviews last year’s list of surprises and next month will give more details about the list for 2018.

My ninth Surprise was that Japan would prove to be a good place to invest in 2017 and that one really worked out well. As I traveled throughout the world last year I found that investors were almost universally underweighted in Japan, yet the earnings of Japanese companies were increasing impressively. The overall economy was growing at 1.5% real, unemployment was low, deflation had ended and consumer and business confidence was high. As a result, the Japanese market and its currency did well last year.

Finally in the tenth Surprise, I anticipated a cooling down of the turbulence in the Middle East with a greater Russian presence and fewer U.S. troops. Syria is still a serious geopolitical and humanitarian problem, and there is a general belief that if the United States were not involved in Afghanistan and Iraq, the Taliban and Al Qaeda would take over immediately. But there is a growing conviction that ISIS has been defeated. The situation remains uncertain, with no resolution in sight.