FILE PHOTO: The front facade of the New York Stock Exchange is seen in New York City, New York, U.S., June 26, 2020. REUTERS/Brendan McDermid
The Russell 1000 Value index .RLVTRI trades at almost 18 times earnings, up from 14 a year ago, and is up some 45% since late March. By comparison, the Russell 1000 Growth index .RLGTRI trades at a multiple of 31, up from 22, and has gained over 70% in the same period. Other arguments for a value resurgence have been fueled by signs of progress on a vaccine against COVID-19, which some investors believe could accelerate business reopenings and a return to in-person schooling across the United States.
That could take the S&P 500 as high as 3,700 by year-end and spur a rotation to value names, especially if the news flow regarding a vaccine continues to be encouraging, Goldman’s analysts said earlier this month. The index recently hovered near 3,500. “Valuation alone doesn’t drive stock prices. It’s the combination of valuation and improving fundamentals,” said Richard Bernstein, chief executive officer and chief investment officer at Richard Bernstein Advisors in New York.
Yet it also warns of “value traps” - stocks whose prices are falling faster than earnings are deteriorating. Such stocks have underperformed broader markets by four percentage points a year since 1997, the bank said.
It’s not possible for there to be a tried and tested vaccine this side of November, anyone who says so they are lying or electioneering, what ever you want to call it. Listen to the experts and scientists.
I guess if you have money you can make money on the share market, even in a pandemic. A pandemic means sickness and it's spread to the share market.
Can someone explain to me how the stock market is surging when millions of people are out of work? I’m genuinely wondering. I keep hearing the stock market is not the economy. But do they not go hand in hand?
Remember about September... Just Sayin'. All bubbles burst.
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Source: Reuters - 🏆 2. / 97 Read more »