The 2 Best Markets of 2013 and 1 to Watch in 2014

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2013 was a good year for stock markets in Japan and the United States, but it was a rough year for Brazil.

2013 was a good year for stock markets in Japan and the United States, but it was a rough year for Brazil.

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  • 1. The 2 Best Markets of 2013 and 1 to Watch in 2014
  • 2. The winners • Equities markets worldwide had a strong year with all G7 countries surpassing the upand-coming BRICs. • Japan, United States, and Germany led the G7 pack. Source: Bespoke.
  • 3. Japan had a strong 2013 • Japan led the G7 markets, up 56.7% for the year. • The Nikkei had its strongest run-up since 1972. Why? Easymoney policies and stimulus spearheaded by Prime Minister Shinzo Abe. Source: Wikimedia Commons.
  • 4. Will the run-up continue in 2014? Source: Wikimedia Commons. • Will 2014 be as strong? No guarantee. Japan faces a lot of headwinds. • Inflation could rear its head. • The country’s debt as a percentage of GDP is more than 200%, which limits future stimulus. • In the end, easy-money policies can only go so far; Japan’s economy must grow.
  • 5. United States in 2013 Source: Federal Reserve. • U.S. markets grew a healthy 29.6% in 2013 despite the first government shutdown in nearly 20 years. • While there were rumblings that the quantitative easing program would be “tapered” throughout 2013, a decrease wasn’t announced until late in the year by Fed Chairman Ben Bernanke.
  • 6. U.S. stocks rocked in 2013 • Netflix and Tesla had incredible years. • Netflix: Up 300% for the year after growing its subscriber base and growing earnings per share through the year. • Tesla: Up nearly 350% for the year as sales start to ramp up. The company tacked on its first ever profitable quarter. Source: The Motley Fool.
  • 7. United States is looking good in 2014 Source: Wikimedia Commons. • Easy-money policies will stay for the foreseeable future even as the taper begins. • U.S. economy has shown signs of strengthening growth with 4.1% GDP growth in the third quarter. • Congress passed a two-year budget, preventing a shutdown. • Consumers are more willing to spend.
  • 8. Brazil had a challenging 2013 • 2013 was a rough year for Brazil with the Bovespa down for the year. • Government spending, plummeting commodities prices, rising debt, and high inflation hurt the country.
  • 9. Brazil had a challenging 2013 Source: Wikimedia Commons. • Consumer debt as a percentage of GDP continues to grow. It was at 25.6% as of August 2013. But consumption growth is slowing as consumers consider paying down debt. • This could hurt consumer spending going forward.
  • 10. Brazil has a lot to prove in 2014 Source: Wikimedia Commons. Maracana Stadium in Rio de Janeiro. • All eyes will be on Brazil as it hosts the World Cup in 2014 and prepares for the Summer Olympics in 2016. • A boost in commodity prices and continued growth in the Brazilian middle class would help grow the economy there.
  • 11. The Top Stock for 2014