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The stock market is on some amazing streaks, as the bulls are firmly in control with new highs seemingly happening every day. This week on the LPL Market Signals podcast, LPL Financial Strategists Jeff Buchbinder and Ryan Detrick discuss stock market strength while also dissecting the recent Fed meeting, economic data, and if now is the time to invest in Europe.

Amazing run for the bulls

Ryan notes various incredible statistics to put in perspective how strong stocks have been lately. Specifically, eight new all-time highs in a row is the longest such streak since 1997. And when the S&P 500 Index is up 25% for the year during the month of November, December tends to be strong as well. Jeff notes some reasons for this recent run: much better than expected earnings, low interest rates, and likely lower taxes than what was priced in just a few months ago.

The Fed stuck the landing

Federal Reserve Bank (Fed) Chair Jerome Powell did a great job of doing exactly what he’s been saying for several months now. Ryan notes just about everything the Fed did was totally telegraphed, and as a result, stocks were happy. Jeff notes there was some talk of a more hawkish takeaway, but that wasn’t the case. Both Jeff and Ryan note that the recent jobs data came in better than expected and this is yet another reason to expect the reopening to continue. Lastly, Jeff puts a bow on this extremely impressive third quarter earnings season so far.

Time for Europe?

Ryan notes one of the most popular questions recently is: Could it finally be time to invest in Europe? Remember, Europe has trailed the United States for the majority of the past two decades. Jeff adds that Europe is indeed historically cheap relative to the U.S., but that by itself isn’t reason to become European bulls. Earnings and gross domestic product (GDP) should improve and Europe is expected to grow more than the U.S. next year, which might surprise many. Still, we see very little relative strength coming from Europe and this could be the first sign needed for a relative bottom to take place. Still, Jeff notes LPL Research would favor developed international (think Europe and Japan) over emerging markets, which remains held back by issues in China.

Tune in now

Listen to the entire podcast to get the LPL strategists’ views and insights on current market trends in the US and global economies. To listen to previous podcasts go to Market Signals podcast. You can subscribe to Market Signals on iTunesGoogle Play, or Spotify.

 


IMPORTANT DISCLOSURES

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth in the podcast may not develop as predicted and are subject to change.

References to markets, asset classes, and sectors are generally regarding the corresponding market index. All indexes are unmanaged and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.

Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. LPL Financial doesn’t provide research on individual equities. All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

All index data is from FactSet.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

This Research material was prepared by LPL Financial, LLC. 

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