Ageing bull market may have longer to run: AMP Capital
Greg Fleming said investor “disinclination for panic” had wrongfooted many more bearish market analysts, who had been disappointed by the resilience equity markets have displayed this year.
“The risk is now, that having overcome a severe sentiment test in late 2018 and another mini-test in May, investors shift into a euphoric mode and push asset prices sharply higher just as the global monetary policy environment swings back into stimulus mode.
"In other words, a ‘melt-up’ scenario in which the further extension of easy money pushes growth asset prices up too quickly for the fundamentals looks ever-more possible.”
He said the market had overcome several potential threats, such as political instability in the US, the risk of a debt ceiling breach, tensions with China and the Federal Reserve's resistance to cut rates.
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