This week’s Sentiment Survey special question asked AAII members whether it is likely or unlikely that the current bull market will last into at least a seventh year. Half of all respondents said the bull market is likely to continue into a seventh year. An additional 11% of respondents think the odds of the bull market reaching a seventh year are somewhat likely. Reasons given for the upbeat outlook varied (earnings growth, price momentum, valuations, sentiment, etc.), though several respondents cited economic growth, accommodating monetary policy and the attractiveness of U.S. stocks relative to other investment options as influencing their outlook.
At the other end of the spectrum, 15% of respondents said it is unlikely and an additional 17% said it is somewhat unlikely for the bull market to last another year. Tightening monetary policy was the primary explanation given, followed by valuations. Other reasons included the possibility of stronger international markets attracting investment dollars, the stronger dollar and the length of the current bull market.
Here is a sampling of the responses:
- “It is likely to happen as other alternatives (bonds, CDs, cash, etc.) offer far worse returns.”
- “Somewhat likely provided that interest rates stay low and employment improves.”
- “Somewhat unlikely since the Fed will probably begin raising rates in the next few months.”
- “Unlikely. P/E ratios are getting frothy.”
- “Very likely. The economy will continue to grow.”