S&P 500 sits with the bulk of equities still maintaining what appears to be the premium created by share over subscription while in search of returns, all under the protection of Fed accommodation. A few stocks stand out as fat, Google and Microsoft are two, while Ford appears to be the only gift out there of the Q8 (AAPL, BAC, GOOG, GS, IBM, MSFT, F, PHE). Long only metrics favor point to F and PFE. AAPL seems a bit tired as it has been nearly 1900 trading days since it has traded down to to what CoverRisk considers trailing value.
So the world equity markets are fat and now enter a period in sharp contrast to those started in 2008 which necessitated lower rates and steady leadership. Now, numerous rate hikes are forecast along with what looks like might be an unsteady, unpredictable national steward. Remember, equities can act happy, such as in the current rally, but they are not always so smart. One only has to think back the subprime disaster whose warnings had been telegraphed for years leading up to a point where the equities gave it all up quickly. Premiums created to accommodate share over participation since 2008 have been ringing alarm bells for the last two and a half years and may finally catch fire with the Donald tweeting all the way down.
