'The market is way ahead of its earnings,' one market analyst said.
The S&P 500 has soared 12% since October, and the rally is largely driven by expectations for a rapid rebound in earnings growth and the global economy.
The S&P 500 has soared 12% since the beginning of October. Not only does the rally defy many tried-and-true economic indicators, it also ignores the ongoing profits slump, leading many Wall Street strategists to urge caution. S&P 500 earnings are expected to drop by 0.3% in the fourth quarter of 2019, marking the first back-to-back quarterly decline since 2016, according to Refinitiv. Analysts project much higher earnings growth in 2020, a 6% increase in the first quarter.
Meanwhile, a century-old classic tool known as Dow Theory has yet to confirm the rally is for real. The
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