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Market 'Torture' for Bulls and Bears

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  • Description

    Sam Stovall of S&P Capital IQ gives his outlook for the markets.

  • Duration 3:22
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Bottom -- my next guest says that the market's climb higher.

Is water torture for both Bulls and Bears -- still Rollins chief equity strategist for S&P capital IQ Sam start of that what do you mean.

Well Dennis what I mean by that is those people who are long right now and who realize that we are just inches away from an all time high and the S&P 500 realize that it usually doesn't break through and close meaningfully above that all time high in the first attempt.

Usually have some sort of repulsion you -- -- you move down few percentage points and then try a couple of times to finally break through.

The bears on the other -- saying you know what I really don't like all of this momentum because every day when the market goes up by two or five points.

Then on that much further in the whole if you will so basically both sides are waiting for the music to stop but one is -- waiting with a bigger smile on the other.

-- to battle between fear that something's gonna go wrong and fear of missing out it seems like the latter appears what's been driving stocks higher lately.

We'll center's -- -- a report on the -- -- it at nearly six year low.

Should you do would you tell your mom to -- by the banks right now.

Well it's a good point because.

I can see why that's the case there's an old saying that bull market takes the stairs -- a bear market takes the elevator.

And so as a result whenever prices -- they tended to creep.

Higher.

Whereas when they fall they tend to jump from the highest building so usually the -- increases as investors are nervous.

And get more fearful.

But at least since 2000 whenever we've had this level of complacency.

It's become a matter of when not if we end up with a price decline of 5% or more so we'll just have to we'd see.

Yes stocks don't go only up and yet when you look at the last time stock for at this 141000.

500 -- in that range.

The economy is in better shape arguably them back then -- then I -- GDP is 12% higher US exports are up 40%.

But cash in the banks is up something like thirty or 40% inflation is still -- like it would be happy about this.

Well we should be I wrote a report recently on market scope advisor.

Basically looking at bare basics and was trying do look at tops.

Going back to world war two and the level so we're looking at now GDP growth of basically economic indicators.

Valuations.

Monetary -- -- set -- up.

Really the only thing that looks out of line is how far the index is from its fifty and 200 day moving averages.

Everything else to me is really sort of in the middle.

And nowhere near the kind of levels we typically see -- market tops.

Right where generally speaking in stocks would you put money.

Now in is it basically -- bet that we keep going higher -- back to protect yourself from going lower.

Well I think it's it's basically the leaning toward we just celebrated our fourth birthday.

And five of the six bull market since World War II that did so.

Went on to celebrate their fifth birthday so number four was on March ninth number five will be a year from now.

Traditionally the market is up 21%.

And it's the cyclical sectors.

That tend to lead the way.

And grow more man that would all kind of -- together all right thanks very much for being with us Sam Stovall.

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