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Three reasons stocks will fall

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By Michael O’Connor, theislandinvestor.com

I can’t recall a time in my career when the outlook was so ‘uncertain'.

I write to clarify my thoughts on the market, but right now, the market noise is deafening.

For me, the economic data points to an obvious slowdown, so my head screams ‘LIMITED UPSIDE’, but my pocket tells me I have been wrong plenty of times before.

Here are three areas I am watching that will dictate where the market goes over the coming months and how you can set up your portfolio accordingly.

1. There is an alternative

Bonds have become a genuine alternative to stocks as the equity risk premium falls.

This is already playing out. More than $100bn has flowed out of stock mutual funds and ETFs on a combined basis over the past 13 weeks, one of the worst flow collapses on record while money market fund flows surge.

The narrative is simple. Why have all your exposure in ‘risky’ stocks if you can get 5% risk-free?

2. Earnings

Company earnings drive the stock market in the long run, and higher interest rates will squeeze margins and lower corporate profits over time.

- In Q4, S&P 500 companies posted an average earnings decline of 4.9% over the same quarter a year earlier. This marks the first quarterly decline since the third quarter of 2020.
- S&P 500 profit margin fell from 13.4% in Q4 2021 to 10.8% in Q4 2022.
- Forward earnings projections have fallen from +10% to +2% over recent weeks - a trend that will likely continue, (some of this is already priced in).

As company profits fall, the price investors are willing to pay to own a part of these companies falls as well.

3. Real Estate slowdown

In the US, 'existing-home sales' have been falling for 12 months straight. January year-over-year sales were down 36.9% and are now at levels last seen during the COVID low and Great Financial Crisis.

Even with supply constraints, housing affordability is far from where it needs to be for demand to return. We need to see either a big adjustment lower in interest rates, a realistic decline in prices or some combination of the two.

In Ireland, the trend is still developing. Europe is behind the US in the rate hiking cycle, so mortgage rates are still relatively low (but rising). The housing market has remained stable as a result.

There have been some signs of a slowdown in activity but no significant price movement. The number of house sales in January 2023 was 11% lower than the same month a year earlier.

However, supply issues and a lower mortgage rate relative to the US mean we are unlikely to see any significant price declines in Ireland just yet.

As rates increase, however, I expect the Irish market to come under the same pressure we are currently seeing play out in the US.

Outlook

As we move forward, the question that determines where the stock market will go changes from:

How high will interest rates go?

to

How long can rates stay this high before something breaks?

In my opinion, any market rallies we see off the back of single data releases will be short-lived - but they will happen.

Long-lasting bull markets require rapidly expanding valuations and/or strong earnings growth. I don’t see a reason for either in the data.

Of course, this is a condensed view. If you want me to help you build out and protect your portfolio, email me mike@theislandinvestor.com or scan the QR code.

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Eddie Sheehy named Hugh O’Flaherty Humanitarian recipient

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Eddie Sheehy named Hugh O’Flaherty Humanitarian recipient


Fossa resident Eddie Sheehy, founder of The Kenya Education Project, has been named the recipient of the 2026 Hugh O’Flaherty International Humanitarian Award.


The former St Brigid’s Secondary College teacher will receive the Humanitarian Award Scroll, Medal, and the €3,000 O’Donoghue-Ring Bursary from Mayor of Killarney Councillor John O’Donoghue at an official ceremony in Killarney on Friday, October 30.
The award commemorates the wartime legacy of Killarney native Monsignor Hugh O’Flaherty, whose Rome Escape Line saved over 6,000 lives in Nazi-occupied Rome during the Second World War. Following a pause since spring 2020, the annual award resumed this year under the stewardship of Kerry County Council, the Killarney Chamber of Tourism and Commerce, and the O’Donoghue-Ring Collection. The selection panel selected Mr Sheehy from 22 international and domestic nominations.
Hugh O’Flaherty Memorial Society Chairperson Jerry O’Grady praised the selection. “Eddie Sheehy is an outstanding example of what one individual with the support of his family and friends can do to enhance the lives of the poor and marginalised in our society,” he said.
Killarney Chamber President Johnny Maguire added: “We are delighted to continue to be associated with the Hugh O’Flaherty Humanitarian Award. His humanitarian work is an inspiration to us all – particularly in these difficult times across the world.”
Accepting the honour, Mr Sheehy said: “I am humbled to accept this award on behalf of all those that have helped with the project since it began back in 2003. Our vital work with the children of Embulbul, Kenya would not have been possible without the wonderful support we receive from schools, friends and local businesses.”

The Kenya Education Project


Founded in 2003 by Eddie Sheehy and his late wife Carmella following a volunteer trip to the Nakuru diocese, The Kenya Education Project supports the underprivileged community of Embulbul, Kenya. Starting with an annual table quiz in Killarney, the initiative initially focused on funding basic educational needs for the local primary school. Over the past two decades, the project has grown to encompass school food programmes, family support initiatives, local medical services, and funding an extension to a girls’ hostel at the local school, sustained by continuous support from Kerry schools and local businesses.

Previous Award Recipients


2009: GOAL aid workers Sharon Commins and Hilda Kawuki, held in captivity for 108 days in Darfur.
2010: Fr Michael Sinnott, Columban missionary abducted in the Philippines who returned to service after his release.
2011: Sally O’Neill, Trócaire Director of Operations who spent 40 years aiding crisis zones worldwide.
2012: Sr Agnes Hunt, former prison chaplain at Wormwood Scrubs and volunteer for the Irish Council for Prisoners Overseas.
2013: Donal Walsh (Posthumous), 16-year-old Tralee teenager who inspired peers to value human life during his battle with cancer.
2014: Dr John Beavis, orthopaedic surgeon and founder of medical charity IDEALS, serving conflict zones in Gaza.
2015: Fr Sean Myers, Killarney-born Redemptorist missionary who spent 55 years serving oppressed communities in Northeast Brazil.
2016: Fr Shay Cullen, founder of the PREDA Foundation protecting exploited women and children in the Philippines.
2017: Sr Orla Treacy, Loreto nun who established primary and secondary schools in war-torn South Sudan.
2018: Ireland’s Rescue Services, honoring the RNLI, Irish Coast Guard, and Kerry Mountain Rescue volunteer teams.
2019: Ireland’s UN Peacekeepers, recognizing Irish Defence Forces personnel serving continuous global missions since 1958.

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Adventure runner completes all Dublin streets

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Adventure runner completes all Dublin streets


Killarney native Seanie Clifford has completed an extraordinary 25-day endurance challenge that saw him run all 4,400 named streets in Dublin while sleeping rough on the city’s pavements every night.



The local athlete completed his final stretch in the capital on Saturday, August 29, after covering a total distance of 2,000 kilometres. Running under the project banner 4400 Streets & Nowhere to Go, Clifford undertook the gruelling schedule to raise vital funds for Focus Ireland, Liberty Soup Run, and Dublin Homeless Awareness.

To mirror the reality faced by thousands of individuals across the country, the Killarney man spent 25 consecutive nights sleeping out on the very streets he ran during the day. Averaging close to 80 kilometres every 24 hours, he navigated heavy traffic, intense asphalt heat, and constant route adjustments alongside his partner and sole support crew member, Alicja.

Reflecting on the experience, Clifford praised the overwhelming backing he received from members of the public throughout the capital. He stated that he went into the challenge with extreme positivity and was rewarded with extraordinary kindness from people across Dublin, with residents from Ballymun to Donnybrook coming out to offer support.

Local support carries



By the midpoint of the challenge, physical exhaustion presented severe hurdles. However, local running clubs and individuals joined Clifford on various sections of the daily routes to assist his progress.

On Day 12, runners from Artane Beaumont Running Club and local supporters joined him on the road, allowing him to complete his daily 80-kilometre target ahead of schedule as community support carried him through the toughest miles.

The final stage of the run coincided with the release of official monthly figures from the Department of Housing, which recorded a record 17,527 people living in emergency accommodation across the country, including 5,659 children.

During the closing days of the project, Clifford was invited into Leinster House to meet with TDs and discuss the conditions he witnessed while sleeping on the streets. He stressed throughout the campaign that while his temporary homelessness would end with a return home to Kerry, thousands of families across Ireland remain without permanent shelter.


Triple Crown completed



Following his arrival at the final street, members of the national ultra-running community confirmed that Clifford had achieved what is widely regarded as the Triple Crown of Irish Endurance.

A former student of St Oliver’s Primary School and St Brendan’s College in Killarney, Clifford first set a national record in 2024 by running all 275 Irish mountains over 600 metres in 21 days. In 2025, he ran the entire 2,700-kilometre length of the Wild Atlantic Way from Malin Head to Kinsale in under 30 days.

Despite his previous mountain and coastal records, Clifford described the urban street challenge through Dublin as his most difficult undertaking to date.

Clifford, who now organises trail running retreats and uses endurance projects to highlight mental health and social issues, finished his final street run on Saturday afternoon to complete the historic trilogy of Irish endurance challenges.

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