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Where next for stocks?

David Llewellyn-Smith
Monday, 10 May 2021
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For months now we have observed as market narratives have splintered into distinctly bullish and bearish camps but stocks have gone up anyway. Three narratives have dominated:

  • Good news is bad news because rising inflation will trigger Fed tightening.
  • Good news is good news because the economic recovery is strong enough to boost profits anyway.
  • Bad news is good news because an easy Fed will support the stock market.

The first narrative has been pushed largely by BofA and today it continues that theme:

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.