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A Better Economy May Not Necessarily Be Better For Stocks
January 09, 2014 at 19:00 PM EST
In a post last week, I explained why the interaction of two factors that defined the market last year – significant multiple expansion and higher interest rates – represents a headwind for stocks in 2014. While a stronger economy will help mitigate some of the pressure from higher rates and more lofty multiples, I still believe that stocks will have a harder go of it this year To be sure, as I write in my latest weekly commentary, the U.S. economy is showing definite signs of improvement, as evident in a recent pattern of strong data. Last week, the December reading of the ISM manufacturing survey, one of the more important statistics in my opinion, came in strong at 57, close to November’s 2 ½ year high. Even better, the surge in new orders to the highest level since April of 2010 bodes well for first quarter growth, as new [...] Click here to read the original article on ETFdb.com. Related Posts: No Related Posts
In a post last week, I explained why the interaction of two factors that defined the market last year – significant multiple expansion and higher interest rates – represents a headwind for stocks in 2014. While a stronger economy will help mitigate some of the pressure from higher rates and more lofty multiples, I still believe that stocks will have a harder go of it this year To be sure, as I write in my latest weekly commentary, the U.S. economy is showing definite signs of improvement, as evident in a recent pattern of strong data. Last week, the December reading of the ISM manufacturing survey, one of the more important statistics in my opinion, came in strong at 57, close to November’s 2 ½ year high. Even better, the surge in new orders to the highest level since April of 2010 bodes well for first quarter growth, as new [...]
