Today, I'd like to feature two charts from Ned Davis Research before moving on to a more personal topic. The first is the NYSE Composite Median P/E Ratio. At 26.5 times earnings, this chart indicates that stocks are extremely overvalued at current levels.
Next is the Real S&P 500 vs. Trend Line Growth. While this chart uses no valuation data, it does indicate we are now in a zone where the market has struggled during the 26.2% of the time it has been this stretched.
That said, momentum remains mildly bullish. And our Investment Committee notes that fundamentals continue to improve, rates are slowly rising, and most large U.S. companies will benefit from recoveries in developed nations in Europe and Asia as well as Emerging Markets. Bottom line: this is a difficult market to call but strength appears to be waning for now.
On a more personal note, Al Chiaradonna, Senior Vice President of Private Banking at SEI (one of our strategic partners based out of Oaks, Pennsylvania) recently posted a blog worthy of sharing: Finding Meaning in Life - All Parts of Life. I hope you find it as good a read as I did. Thanks for reading and here's to finding meaning in life every day.
Stacey Wall serves as Chief Executive Officer at Pinnacle Trust. You can reach him by emailing him at firstname.lastname@example.org or by calling the office at 601-957-0323.