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Why Wall Street sees the stock-market on the verge of a ‘melt-up’
Market Watch ^ | 12/16/2019 | Mark Decambre

Posted on 12/16/2019 11:17:56 AM PST by SeekAndFind

Is the stock market on the brink of breaking into an unmitigated run-up to fresh records?

That is the question that a number of a market strategists are exploring as the Dow Jones Industrial Average DJIA, the S&P 500 SPX, and the Nasdaq Composite COMP, indexes mount their latest in an assault to new all-time closing highs, powered by hope that the U.S. and China can forge a preliminary trade accord to resolve a prolonged battle over import duties. A number of other geopolitical headwinds, at least momentarily, have died down, including concerns about market-roiling effects from uncertainty due to Britain’s Byzantine pathway toward an exit from the European Union.

Analysts at Bank of America Merrill Lynch, led by strategists Michael Hartnett, described the market as “primed for Q1 2020 risk asset melt-up,” with the Federal Reserve and the European Central Bank still providing ample support to portions of the market and economy that have shown some signs of softness.

UBS Global Wealth Management Chief Investment Officer Mark Haefele said that the partial Sino-American trade resolution contributes mightily to the bullish thesis that a number of strategists have adopted.

“This could unlock further upside for equity markets, driven by an improvement in business confidence and a recovery in investment,” Haefele wrote.

It is important to note that the a so-called melt-up is considered by market pundits as the end phase of an asset bubble and is usually followed by a significant downturn in stock values. Strategists have predicted meltups a number of times over the past 18 months, with concerns growing about U.S. economic growth in its record-setting 11th year of expansion, supporting fears that an economic and stock-market pullback are inevitable.

(Excerpt) Read more at marketwatch.com ...


TOPICS: Business/Economy
KEYWORDS: stockmarket; wallstreet
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To: Steely Tom
One of the most despicable things that this criminal media has done (take a number what's most despicable) is the way-too-obvious attempts at playing down this economy under PDJT. If this happened under Obozo, we would hear and read non-stop coverage about how great everything is and how brilliant Bammy is in managing our economy.

It just goes to show that the criminal media do not consider themselves as Americans but Democrats first. Party uber alles.

21 posted on 12/16/2019 11:49:47 AM PST by NohSpinZone (First thing we do, let's kill all the lawyers)
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To: SeekAndFind

What it doesn’t say is that investors are NOT afraid that Trump will exit the White House. They don’t believe that he will be removed from office. They expect him to get reelected. They DON’T expect an anti-capitalist fool like lizzy warden to get elected.

A few weeks ago all the media started repeating the word “recession” because of some stupid insignificantly small momentary “inversion” in interest rates. They are about to stop saying “trade war with China”. They would look silly calling Trump a warmonger. Will they credit obammy for the melt-up?


22 posted on 12/16/2019 11:51:51 AM PST by I want the USA back (If free speech is taken away, dumb and silent we are led, like sheep to the slaughter: G Washington)
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To: Vince Ferrer
Most freepers thought the Euro would collapse after the start of the EU. It went down but not as much as I expected.

23 posted on 12/16/2019 11:54:36 AM PST by Steve Van Doorn (*in my best Eric Cartman voice* 'I love you, guys')
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To: dakine

Pssst...Blue Horseshoe loves Anacott Steal.


24 posted on 12/16/2019 11:57:28 AM PST by Obadiah (Kill the deep state or lose the Republic.)
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To: Steely Tom

I thought the import tariffs were going to “ruin” the Christmas buying season?


25 posted on 12/16/2019 12:01:16 PM PST by central_va (I won't be reconstructed and I do not give a damn.)
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To: SeekAndFind
Imagine an economy before the invention of motorized cars and trucks (or an internal combustion engine for that matter). Imagine that everything moved about by horse and buggy (ignore trains for the moment).

And then POOF. Someone invents the engine, the automobile, and the truck.

If it occurred like that--POOF--it would cause massive market dislocations, but it would also cause the market to explode upward.

Of course, it didn't happen like that, but imagine if it had. Imagine that it didn't take years and years of slow development for new ancillary products to come into the laboratory and then into the market.

That gives you some idea of what is happening in our market right now. Many new ideas are in development...and these aren't ideas that will take years to come to market.

As we can see in the recent past, the world (economically and product-wise) is VERY different than just 10 years ago. And the speed of invention is moving at an increasing rate. Faster and faster.

That is the economy and the world we are living in.

Of course, the stock market does not reflect that rapid increase in the rate of invention because it cannot clearly and accurately determine how that rate of change will affect which stocks and by how much.

But the pressure is building. And now we (some investors that is) are working feverishly to develop the algorithms which can be used to relatively accurately predict the effects of his rapid forward movement--you might call it the "great leap forward"--in development/invention.

This is part of a melt-up concept.

The capability of an investor to buy ETF's which reflect the market as a whole (QQQ is my favorite) or just market segments also adds to market momentum in the aggregate.

As the world watches in awe as it changes technologically, investors are waking up as to how to capitalize on this explosion. And it is coming. Stopping it would be like stopping a tidal bore or a tsunami.

Anyway, just a few thoughts.;-)

26 posted on 12/16/2019 12:09:24 PM PST by RoosterRedux
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To: Obadiah

use the offshore accounts, and keep it quiet.


27 posted on 12/16/2019 12:09:43 PM PST by Tobias Grimsley
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To: NohSpinZone

That’s so true - at least every other week they’d be leading the nightly news with a features about new market highs and the roaring economy, “Will it ever slow down?” And interviewing families who are truly better off financially.


28 posted on 12/16/2019 1:11:13 PM PST by GnuThere
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To: SeekAndFind

https://www.foxbusiness.com/markets/dow-gains-10000th-point-since-trumps-election

Dow gains 10,000th point since Trump’s election
Market surge heightens stakes in 2020
By Jonathan Garber - FOXBusiness

The stock market has been unstoppable under the influence of President Trump.

The Dow Jones Industrial Average crossed 28,332.74 on Monday, meaning it has rallied 10,000 points, or more than 54 percent, since Trump’s election victory on November 8, 2016. The benchmark S&P 500 has gained more than 46 percent.

“The rally has been driven by pro-growth measures, de-escalation of trade tensions, huge liquidity injections by central banks and a FOMO approach by investors worried about missing out on a remarkable U.S. market outperformance that has set one record high after the other.” Mohamed El-Arian, chief economic adviser at Allianz, told FOX Business.


29 posted on 12/16/2019 1:38:38 PM PST by abb
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To: Sacajaweau
I remember when the Dow hit 1000. During the Nixon administration.
30 posted on 12/16/2019 5:57:11 PM PST by hinckley buzzard (Power is more often surrendered than seized.)
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To: hinckley buzzard

I remember life before television. :-)


31 posted on 12/16/2019 6:03:55 PM PST by Sacajaweau
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To: Steely Tom

Trial run in preparation for much closer to the election.

It worked too well and scared them.


32 posted on 12/16/2019 6:54:47 PM PST by Sequoyah101 (We are governed by the consent of the governed and we are fools for allowing it.)
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