“I don’t think we’re at the absolute bottom yet because the implications of this shutdown are incredible,” Mark Mobius, the founding partner of Mobius Capital Partners, said. He added that “things are pretty bad” from the perspective of corporate earnings.
S&P 500 could tumble to a range between 1,275 and 1,710 before a bull market resumes, writes Cam Hui.
1. Investors are too bullish
2. No technical signs of a long-term bottom
3. Valuation headwinds
4. What are smart investors doing? Here is another way of thinking about valuation. Insiders stepped up and bought heavily during the most recent downdraft, but this group of “smart investors” backed away as the market rose.
You can't have an economic downturn 4 times worse than the financial crisis as Goldman says and have a $SPX 3,000 target at the same time without massive price distortion.
— Sven Henrich (@NorthmanTrader) April 14, 2020
Buybacks have been jet fuel for the post-2008 US market rally – exceeding capex the last two years running, for the first time on record – but are now coming to an end. pic.twitter.com/mwAjtVgDCy
— Robin Wigglesworth (@RobinWigg) April 14, 2020
Companies taking out more #debt to rescue other companies that are insolvent from too much #debt, made possible by an #SEC rule change this year that allows them to #leverage themselves even more… isn't this how #Ponzi #schemes work? 🤔 👇 t.co/jlyxeWGIt5
— Invariant Perspective (@InvariantPersp1) April 13, 2020
— 𝕮𝖍𝖎 🛢️ (@chigrl) April 14, 2020
What a lot of people want to know is how shares can be so close to all-time highs when everyone keeps talking about the worst since the 1930s. There's a big disconnect there t.co/GA7YZfY2N1
— Edward Harrison (@edwardnh) April 14, 2020