Markets

Momentum’s rally is still on

Michelle Gibson / Getty Images
Michelle Gibson / Getty Images

The momentum style factor-stocks that are trending higher in prices-has outperformed the broader market so far this year. We believe that sustained above-trend economic growth and solid earnings prospects could help extend momentum's gains, but the road ahead could be bumpy.

Momentum has historically outrun the broader market, but with periodic sharp drops. The biggest dips in the performance of the MSCI ACWI Momentum Index relative to the MSCI ACWI Index have mostly coincided with recessions and financial crises, as the chart shows. Our research shows that momentum tends to perform the best during sustained economic expansions. We are in such a phase, and we see this cycle having ample room to run.

Not just about tech

sharp drop in tech stocks Weekly Commentary Richard Turnill is BlackRock's global chief investment strategist. He is a regular contributor to The Blog .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Other Topics

Stocks

Latest Markets Videos

    BlackRock

    BlackRock offers breadth of capabilities - and depth of knowledge – across active and passive strategies, including iShares® ETFs. This is combined with a singular focus on delivering strong, consistent performance and an ability to look across asset classes, geographies and investment strategies to find the right solutions.

    Learn More