Jason Trennert – A Useful Market Overview
It was a slow day of holiday trading, so many may have missed the insightful CNBC interview with Jason Trennert, Chief Investment Strategist at Strategas Partners.
He is pretty bullish for the rest of the year, warning that those waiting for a dip may not get one. He noted that it "all comes back to earnings and interest rates." He observed that the "market is very much behind the level of profits achieved so far. Valuations have moved lower, and PE’s have been cut in half."
While we prefer to put more specific numbers on these trends, Tennert’s summary is accurate.
He also made a great comment on current market sentiment. His variant view, with which we strongly agree, is that sentiment is supportive of higher stock prices.
In the short term the market will move
higher. Hedge funds, foreign investors,
and retail investors have not pariticpated in the rally. Sentiment is an asset.
He sees a possible pause at the beginning of next year, when the Fed faces renewed economic strength, but a strong finish to 2007.