As the bull market rolls on, storm clouds may be gathering
This month the hard-charging FAANG stocks - Facebook, Amazon, Apple, Netflix and Google - saw a sudden pullback which market watchers say is a warning of turbulent times to come.
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THROUGHOUT the turbulence of his first months in office, US President Donald Trump has been able to point to one bastion of support: the stock market. This month he tweeted the "great economic news" he thinks the mainstream media has been ignoring: The Dow Jones Industrial Average was up 16 per cent and the Nasdaq up 19.5 per cent since his election. Commerce Secretary Wilbur Ross maintained that the Trump administration had bestowed US$4 trillion in gains on investors.
Investors have seemingly been oblivious to claims of Russian interference in the presidential election, the firing of the FBI director and the appointment of a special prosecutor. As the second quarter ends this week, 2017 has been a banner year, with major US indexes hitting records. But as the bull market rolls on, some see storm clouds on the horizon.
"Valuations are high and it's one of the longest and largest bull markets in history," said James Stack, president of InvesTech Research. "Bull markets don't last forever. So the question is, when will the music stop?"
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