Brian Levitt, global market strategist at Invesco, provides answers to frequently asked questions about the current stock market.
Question 1: How do we make sense of the disconnect between the negative economic data and the near-record high U.S. stock market indices?
Lagging economic indicators, such as gross domestic product and the unemployment rate, will likely be of little future consequence to the market. Instead, markets are trading, and will likely continue to trade, not on whether conditions are good or bad, but rather on whether circumstances are getting better or worse. There is little that is “good” about the current environment, but conditions have improved markedly since the March 23 bottom.
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