Tuesday, 4/25, 8:42 am EST. If my timing call last week was tough, because the indicators weren’t uniform or deep… yesterday’s huge push makes the whole matter even more confusing. Why? Two very simple, but important reasons. First, there was no big volume surge behind it… at all! And, second, market breadth was weak and thin. I was somewhat excited, when I went to update the closing prices on my holdings, only to find that the safe-dividend growers that I prefer and buy had only a rather tepid and mediocre day, at best.
The blast-off was based upon a geo-political event. That might be reason enough, but the real driver of stocks is going to be economic growth and expansion that results in real earnings growth… and the French election may not hold too very much of that in store for US listed companies.
So, let’s be sufficiently cautious, and not cast care to the winds. Valuations are getting stretched. I did indeed get something of a low-risk market entry signal, just in time, by the middle of last week… but, we’re just about to invoke the sell-in-May-and-go-away crowd, too!
At 9:05 am, just read this, FWIW: “Legendary trader Paul Tudor Jones is now sounding the alarm…
As Bloomberg reported last week, he believes stocks are trading at valuations that are simply unsustainable…
Billionaire investor Paul Tudor Jones has a message for Janet Yellen and investors: Be very afraid.
The legendary macro trader says that years of low interest rates have bloated stock valuations to a level not seen since 2000, right before the Nasdaq tumbled 75 percent over two-plus years. That measure – the value of the stock market relative to the size of the economy – should be “terrifying” to a central banker, Jones said earlier this month at a closed-door Goldman Sachs Asset Management conference, according to people who heard him.
But, we should also point out that Jones – who famously tripled his money during the 1987 stock market crash – said it is not yet time to go heavily short.
He believes the market is likely to become even more expensive before the inevitable correction begins… particularly if Le Pen loses next month’s election.”