For many the rise of nominal equity prices over the past few years has been remarkable given the back-drop of stagnating growth and joblessness. But it is the last few months that perhaps beggars belief as macro fundamentals plunge to 5-month lows [3], consumer confidence to 13-month lows [4], and earnings show considerable weakness [5] (if you look at the data and ignore the anecdotes); and yet, day-after-day, stocks push higher little-by-little, stop-run by stop-run to five-year highs. The chart below suggests, though, that for now the parabola may need a little pullback before gathering steam once again.
The parabolic rise has hit its upside (which has tended to mean a pullback in the past)...
[6]
As Macro fundamentals hit 5-month lows...
[7]
and earnings disappoint...
[8]
and confidence plunges...
[9]
Charts: Bloomberg