Several stock market gurus are “looking at the risks that still lie ahead in the current relative calm,” according to a recent article in Reuters.
The article cites comments from experts such as Jeffrey Gundlach who “had been warning for more than a year that markets were too calm.” With regard to the correction that occurred earlier this month, Gundlach said, “Do you honestly believe today is the bottom?”
“Many strategists have been bullish about the market’s potential to stretch the near-nine-year-old bull market further,” the article reports, adding, “Many had said they expected a pullback, but then a resumption of gains.” The S&P 500’s drop earlier in the month didn’t dash their hopes for moderate gains by the end of 2018, it says, given the strength in corporate earnings and the projected interest rate environment.
Blackstone’s Byron Wien asserts, “I don’t think we’re done,” but believes there could be bumpy market road ahead. The latest correction, he says, “did not cleanse the optimism sufficiently.” Wien argues, “Everyone says: ‘Oh, well, now we’ve had the 10 percent correction that everyone was waiting for, then we go back up again. But it’s not as simple as that.”