Market rebound in spring could give way to some turmoil if past trends hold
Traders on the floor of the New York Stock Exchange.
About six months after a presidential election and more than a year after a deadly market downturn, stocks remain buoyant near record highs.
The market leadership spins as if it were choreographed, helping to keep the index withdrawals shallow despite a long period of upbeat sentiment and economic enthusiasm. Conditions look ripe for some sort of correction, but the rally continues. As the gang swayed around election time, Wall Street found a lot to like about the policy mix launched in Washington.
T-bill yields have broken all-time lows and investors are a little wary of the level that could dampen the economy and pinch stock prices, but so far little damage has been done.
The yield curve steepened, a sign of economic optimism and the Fed’s abstinence. Corporate profits are levitating. Bad bond risk spreads slumped to record lows due to precarious extremes during the latest stock crash.