By Victor Reklaitis, MarketWatch
It’s looking lovely for the stock market’s true believers at the moment, as the Nasdaq gets acquainted with the 8,000 level, while the Dow says “nice to see you again” to 26,000.
“The bulls have firm control here, as a market breaking out of prior all-time highs is as bullish as it gets,” says Chris Weston , Pepperstone Group’s head of research.
“Sure, the bears can focus on valuation and fairly concentrated breadth,” he adds. However, Weston suggests he’s not worrying about the market’s pricey-ness yet — and then he gives the spot where he expects to see more trouble.
“The S&P 500 on 16.8X consensus forward earnings is lofty, but there is scope for the market to push this to 18X before real vulnerabilities kick in,” he writes, delivering our call of the day .
“So I am happy to remain long here, with conviction increased on a weekly close through 2,872, while ideally, one would want to see new highs in the Dow and Dow transport index, too.”
Strategist Ed Yardeni also notes the S&P 500 is trading at just below 17 times forward-year estimated earnings. And Yardeni is pushing back against talk that the market’s breadth stinks, pointing out that it’s not just all about FAANGs, as small caps and mid caps are performing well, too.
Meanwhile, Jeremy “Stocks for the Long Run” Siegel has been emphasizing that “we are much less, so to speak, overvalued” than just before the dot-com bubble popped in 2000. “It feels like pretty reasonable valuation,” the professor said to CNBC , highlighting that the S&P changed hands 18 years ago at about 30 times trailing earnings.
Key market gauges
Futures for the Dow , S&P 500 and Nasdaq-100 are slightly higher. That’s after the Dow /zigman2/quotes/210598065/realtime DJIA -0.12% yesterday closed above 26K for the first time in six months as the U.S. and Mexico made a deal on trade, while the S&P /zigman2/quotes/210599714/realtime SPX -0.16% and Nasdaq Composite /zigman2/quotes/210598365/realtime COMP -0.33% notched all-time highs for a second session in a row.
Europe /zigman2/quotes/210599654/delayed XX:SXXP -0.59% is mostly rising, after Asia finished with gains. Goldand oilare advancing, as the dollar index /zigman2/quotes/210598269/delayed DXY +0.16% dips. Bitcoin /zigman2/quotes/31322028/realtime BTCUSD -1.29% is trading around $7,000.
See the Market Snapshot column for the latest action.
Many traders are poking fun at the bears these days, including the folks at StockTwits as they share the chart above from Jon Boorman , a portfolio manager at Broadsword Capital.
“Who will try next?” the StockTwits crew says in a tweet . “Here’s the S&P 500 next to all the people who tried to call a top.”
The bears are still growling, of course:
Lots of Twitter users are retweeting a fake Warren Buffett account that has been giving advice along these lines:
Tesla /zigman2/quotes/203558040/composite TSLA +5.66% news: Apple /zigman2/quotes/202934861/composite AAPL -1.16% buying the car maker may not be so ridiculous right now, and Elon Musk is not expected this week at Burning Man .