There are more hints of a melt-up in stock prices. That could be a more serious threat than any geopolitical blowup to my prediction that the secular bull market could run for another two years or longer. The forward valuation multiples of the S&P 500/400/600 are now at bull-market highs and slightly exceed the 2007 highs of the previous bull market. On Tuesday, the forward P/Es of the three S&P composites rose to 15.4, 17.7, and 19.1.
Bullish sentiment has rebounded sharply during the past few weeks. The Bull/Bear Ratio compiled by Investors Intelligence fell from a recent high of 4.23 during the week of December 24 to 2.40 during the week of February 11. Over the past three weeks, it has bounced back to 3.62.
Today's Morning Briefing: Peace Prize. (1) Putin: A man of peace. (2) All quiet on the stock market front. (3) Geopolitical flare-ups tend to be buying opportunities. (4) Forward P/Es at bull-market highs. (5) Forward earnings stagnating for S&P 500, but still rising for US MSCI. (6) Ex-US, global earnings continue to flat-line. (7) Europe’s recovery is too weak to boost earnings estimates. (8) China staying with 7.5% growth. (9) Pollution is China’s “red-light warning.” (More for subscribers.)
Bullish sentiment has rebounded sharply during the past few weeks. The Bull/Bear Ratio compiled by Investors Intelligence fell from a recent high of 4.23 during the week of December 24 to 2.40 during the week of February 11. Over the past three weeks, it has bounced back to 3.62.
Today's Morning Briefing: Peace Prize. (1) Putin: A man of peace. (2) All quiet on the stock market front. (3) Geopolitical flare-ups tend to be buying opportunities. (4) Forward P/Es at bull-market highs. (5) Forward earnings stagnating for S&P 500, but still rising for US MSCI. (6) Ex-US, global earnings continue to flat-line. (7) Europe’s recovery is too weak to boost earnings estimates. (8) China staying with 7.5% growth. (9) Pollution is China’s “red-light warning.” (More for subscribers.)
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