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Are we heading into phase 2 of this rally?
Some thoughts on the
Some thoughts on the
So.
Spring is here, vaccines are aplenty, growth is booming and the S&P just clocked its best 12-month return in history.
Lots of reasons to feel good here.
Spring is here, vaccines are aplenty, growth is booming and the S&P just clocked its best 12-month return in history.
Lots of reasons to feel good here.
BUT.
The game is changing.
We're going from a low expectations, high growth environment to a high expectations, (probably) high growth environment.
The game is changing.
We're going from a low expectations, high growth environment to a high expectations, (probably) high growth environment.
I mean, look at this.
S&P 500 earnings beat estimates by 10 percentage points or more the last three quarters.
That probably won't happen again with ~16% YOY growth expected for Q1.
S&P 500 earnings beat estimates by 10 percentage points or more the last three quarters.
That probably won't happen again with ~16% YOY growth expected for Q1.
High growth is a good thing.
But a high bar for growth could = higher disappointment ahead.
But a high bar for growth could = higher disappointment ahead.
Also, bull markets tend to lose steam in year 2 as they shift out of recovery mode.
Add in the fact that volumes could drop off this summer with everybody and their dang mother getting out of house, and we could see a wandering market over the next few months.
We don't think there's anything nefarious brewing.
It may just be time for everyone to lower their expectations for the market.
And we could be wrong. I mean, this market has some serious momentum to it!
It may just be time for everyone to lower their expectations for the market.
And we could be wrong. I mean, this market has some serious momentum to it!
Bottom line? Weâre still optimistic on the market, but donât be shocked if this rally turns a corner and eases off a little.
Nothing nefarious. Just a little breather after a sprint-like recovery.
Nothing nefarious. Just a little breather after a sprint-like recovery.
Thatâs phase 2.
Anyways, thereâs more to life now than being glued to a screen.
And less time devoted to market-watching = more time to have a hot vax summer
Anyways, thereâs more to life now than being glued to a screen.
And less time devoted to market-watching = more time to have a hot vax summer
Want more of our thoughts on this?
Youâre in luck. @justLBell just released her Q2 outlook! https://www.ally.com/do-it-right/trends/stock-market-outlook-april-2021/
Youâre in luck. @justLBell just released her Q2 outlook! https://www.ally.com/do-it-right/trends/stock-market-outlook-april-2021/
