Washington and Wall Street seem to exist in two different realities.
distance A messy day at the Capitol on WednesdayThe three major indices rose to new highs, and were unparalleled by continued political anxiety.
Nancy Tengler, chief investment officer at Laffer Tengler Investments, credits the wonderful nature of markets for overcoming the turmoil.
“The stock market is not a proxy for society; it is a proxy for future economic growth, so while we can certainly feel sadness and sorrow for this event, the market has no emotions. It is looking for future earnings,” Tengler told CNBCA nation of commerce” Thursday.
She said additional stimulus should also keep money flowing into the market.
“If you look at the delayed effects of the stimulus, we are still benefiting from the March / April stimulus we received last year, so we expect that the $ 900 billion that just passed has not been brought to market yet,” Tengler said. .
Nevertheless, Tengler cautions that the markets may see a correction, although it sees this as an opportunity to add to positions as “liquidity always finds its way into risky assets”.
Matt Malle, chief market strategist at Miller Tabak, agrees with Tengler that the market may see a correction. Unlike Tengler, his concern lies in the market’s belief that excess liquidity will be unlimited.
He said in the same interview: “What happened this week is a sign of this complacency in the market.” “I mean, we’ve gotten a 16% rally in just two months, and have rallied nearly 70% since March. So this kind of news was supposed to be something I sign a little bit more. And again, that feeling” Don’t worry the Reserve Bank The Fed and the stimulus will be endless, it will always push the market up. “It made people completely content to ignore any potential bad news.”
Comments from Federal Reserve Including Raphael Bostick is from Atlanta Malley suggests that the monetary stimulus could diminish sooner rather than later. Any tightening can lead to a regression or a correction.
“People can make a little bit of money here to take advantage of corrections that are always natural and always healthy, especially when you hit an expensive market like this one,” Mali said. “You may want to collect a little bit of liquidity as the market rallies early this year and be able to take advantage of the pullback, which I think will start before the first half ends.”
The Standard & Poor’s 500 It rose more than 1% to start the year. The index reached its highest level at 3811.55 on Thursday.