01-16-2017, 11:19 PM
Trump reflation rally on its last legs? Some think so:
Amundi SA, Europe’s largest money manager, says investors who have driven U.S. stock markets to record highs in expectation of fiscal stimulus from the Trump administration may be in for a surprise. While a pivot to government spending and tax cuts may prolong the economic expansion in the U.S., Republican lawmakers will insist that fiscal measures don’t push up the deficit, Didier Borowski, the Paris-based asset manager’s head of macroeconomics, said in an interview. Even if President-elect Donald Trump succeeds in delivering stimulus, it won’t have an impact before next year, he said.
Europe’s Biggest Fund Manager Says U.S. Stock Bulls Got It Wrong - Bloomberg
The Trump rally is on its last legs, and according to one strategist, that means stocks could see a huge drop in the coming months. Since the election, the S&P 500 Index has rallied more than 6 percent while the Nasdaq hit another record intraday high on Friday. Meanwhile, the Dow Jones Industrial Average continues to hover just under the 20,000 level, underscoring what some analysts believe is a market that's starting to look too frothy. "The U.S. market, we feel, was already overvalued going into the election," Mark Eibel, director of client investment strategies at Russell Investments told CNBC's "Futures Now"last week. "It got even more extended, and I think you're seeing this year almost a re-balancing into some of those other areas, whether it's bonds, whether it's emerging markets."
Trump rally is losing steam and stocks could fall into correction territory: Strategist