The trend is your friend. Investors who base their investment decisions on overall market trading activity usually earn money in the long run. Then again, there are times when every stock or almost every stock that is listed and traded on the New York Stock Exchange increases in value.
Herein is the basis of a “Bull Market.” A market that trends higher as time passes due to the fact that the average value of all of the stock of the corporations and other business increases because those businesses earn a profit. Investor optimism about future economic activity within the economy of any particular country is also part of the reason why stock prices rise as time passes.
Here are some ways in which to determine the coming of a “Bull Market.” In order for a business to be profitable people must purchase the products that it sells. The kinds of products and/or services that it sells is the determining factor of which sector of the economy that it serves. Such economic sectors include the manufacturing sector, the travel industry, mining, banking, Real Estate, and the retail sector.
The rate of unemployment directly affects every sector of the economy, in that when there is a high rate of unemployment the business activity in one or more sectors of the economy is less than profitable for most businesses because unemployed people do not spend as much money as they did when they were employed. Therefore, a decrease of the rate of unemployment is a sign of increased economic activity. That is why the rate of unemployment is the single most important indicator of future economic growth within any country at any given time.
World events, such as a World War or a global disaster can cause “Bull Market” conditions within the countries that are not affected by such events, in that they will provide goods and services to those countries that do suffer the full effects of such events. That is why it is important not to allow other countries to have the ability to adversely effect the economy of the country in which you live.
In a World Economy a wealthy country is one that exports more goods, natural resources, and services than it imports from other countries. Business activity within a wealthy country is good so there is no reason why the stock market within that country should not be a rising “Bull Market” where investors expect the value of most businesses to increase.
So too, when the value of country’s currency increases that is a sign of economic stability. That particular country has little or no debts that must be paid to other countries. As such, its financial markets, banks and people are usually debt free as well or have the ability to pay such debts as time passes. A country’s world credit rating is as good as it can be when it is also a wealthy country.
So now you have a few ways in which to determine if and/or when the financial markets within your country will become or are defined as being “Bull Markets.” The rich do seem to get richer.