Don’t Look Now But Valuations Are Improving
My wife and I are supposed to be vacationing in England this week and next. But since COVID’s Delta Variant (and the U.S. State Department) had other plans, my wife and are instead “staycationing” via a couple short trips. While the mountains of Colorado are very different from the Lake District of England and we […]
Rocky Road Ahead?
From my seat, the key driver to the stock market game appears to be the outlook for growth. As in what the growth rates for both GDP and corporate earnings will be once we get beyond comparisons to the economic shutdown phase. As I wrote last time, growth is likely peaking due to the fact […]
Is ‘Peak Everything’ A Problem?
Despite surprisingly good data on Retail Sales, stocks of all styles, sizes, and shapes took a hit on Friday. Semis, banks, smallcaps, midcaps, and large caps – all down. Value – down. Cyclicals – down. Growth – also down. Save the traditional risk-off sectors such as healthcare, staples, and utilities, there was nowhere to hide. […]
Growth vs. Inflation Drama
Global stocks posted another stellar quarter on the pandemic reopening, providing the strongest first-half performance in over twenty years (Markets Insider, “US Stocks Close Mostly Higher to Finish One of the Strongest First Halves of the Year since 1998,” 6/30/21). However, the tranquility seen among the major indices masked several waves of rather violent rotation […]
Bulls (Still) Deserve Benefit of Doubt
I was recently asked to provide a quick answer to the question “where are we now?” as far as the markets are concerned. While “quick answers” are not usually part of my repertoire, I decided to give it a shot. Cutting to the chase, I believe the stock market is currently in the process reconciling […]
Why I’m Not Worried About Valuations
One of the bear camp’s main arguments is that stocks should be moving down instead of up because of high valuations. Our furry friends suggest that with traditional valuation metrics (Price-to-earnings/dividends/book value/sales, etc.) in the stratosphere, stocks simply have no upside. Then when you mix in the Delta variant spreading rapidly around the world, inflation […]
The Key to the Second Half Will Be…
As the second quarter of 2021 winds to a close, the S&P 500 finds itself at all-time highs. To many, the new heights the venerable large-cap index has recently scaled is more than a little bewildering. After all, wasn’t the stock market in the throes of a corrective phase just a week ago? Didn’t the […]
What’s Up With Bond Yields?
I am finishing up a long weekend visit with family in Santa Fe this morning, so I’m going to keep today’s missive short and sweet. My current take is that markets remain in a consolidation mode and are now in the process of digesting/adjusting to the new info from last week’s Fed meeting, which was […]
About That Inflation Problem
For those of you keeping score at home, it was the inflation data that dominated the stock market game last week. While the numbers were eye-popping, the market reaction was not. And the narrative around the subject appears to be evenly split between the two teams on the field. In one dugout, the argument is […]
What’s Next?
Stocks didn’t make much progress again last week and appear to remain trapped in a consolidation phase. While the S&P 500 did manage to eke out a gain, none of the major indices were able to break out of their respective trading ranges. The sideways action seems to be driven by the conflicting themes in […]