Sentences with phrase «rich valuations often»

Put simply, when valuation measures are steeply elevated but investors remain inclined to speculate, as evidenced by very broad uniformity of market action and the absence of internal divergences, rich valuations often have little effect on market outcomes.

Not exact matches

I've long noted that the analysis of market action can help to overcome some of this frustration, as stocks have often provided good returns despite rich valuations so long as market internals were strong, and the environment was not yet characterized by a syndrome of overvalued, overbought, overbullish, and rising yield conditions.

Risk - seeking investor preferences allow markets to be tolerant of rich valuations and even bubbles, while a subtle shift to risk - averse investor preferences often signals an impending and catastrophic end to those valuation extremes.

The «canonical» market peak typically features rich valuations, rising interest rates, often a reasonably extended and «flattish» period where, despite marginal new highs, momentum has gradually faded while internal divergences have widened, and finally, an abrupt reversal in leadership, from a preponderance of new highs over new lows (both generally large in number) to a preponderance of new lows over new highs, with the reversal often occurring over a period of just a week or two.

Presently, deteriorating stock market internals suggest fresh skittishness among investors, which coupled with still - rich valuations (on the basis of normalized earnings) often results in particularly negative outcomes for stocks.