How can the stock market rise while the economy remains down?
We can think of at least four reasons:
1) Publicly listed companies didn't get there by accident. Many provide the technology it takes for us to operate in this shutdown environment, others have the resources and clout to stay open and take market share from those forced to close.
2) States are reopening and "greens shoots" of economic growth are appearing.
3) The overall US market remains undervalued. And,
4) The money supply is exploding.
While some think this is a "sugar high" we aren't in that camp, and think investors should stay optimistic on US equities.
Click here to watch the latest Wesbury 101 - Corona Virus, Stocks and the Economy
Brian S. Wesbury - Chief Economist
Robert Stein, CFA – Deputy Chief Economist
This report was prepared by First Trust Advisors L. P., and reflects the current opinion of the authors. It is based upon sources and data believed to be accurate and reliable. Opinions and forward looking statements expressed are subject to change without notice.
This information does not constitute a solicitation or an offer to buy or sell any security
Brian Wesbury, Robert Stein, and First Trust Advisors L.P. are not affiliated with Royal Alliance Associates, Inc. or StonePoint Financial.