Jim Young, vice-president at Invesco Canada Ltd., says that after pausing for two years to digest previous gains, the U.S. equity market is entering the second leg of its bull market which began in March 2009.
"This second phase of the bull market will be earnings driven," says Young, a veteran U.S. equity manager with an emphasis on growth. Key sectors of the U.S. equity market such as health care and technology are reporting strong earnings growth, he notes. "I am particularly constructive on these two sectors."
The macroeconomic picture is supportive of U.S. equities in general, Young says. There is widespread recognition that "there is a lot of economic stimulus in the world and that interest rates are likely to remain at historic low levels for some time." Also, he says, a number of issues that have plagued U.S. companies, such as the strong U.S. dollar, have worked their way through.
