This week’s Sentiment Survey special question asked AAII members to explain how, if at all, the Dow’s rise above 20,000 influences their expectations for the stock market. Over half of the respondents said that the Dow’s recent performance has little to no influence on their expectations. Roughly 15% of respondents said that the Dow’s recent performance gives them a more optimistic stance on what’s to come; some even mentioned the possibility of an improving economy because of Trump’s election. Slightly over a quarter of respondents said that the Dow’s performance presents a selling opportunity, or confirms that the market is overvalued.
Here is a sampling of the responses:
- “20,000 on the Dow does not influence my expectations. My investment focus is long-term.”
- “It’s just a number, but I sense a turning point for the better under our new president.”
- “I am more interested in the financials of individual stocks than the Dow Jones industrial average.”
- “Bad things happen after you hit all-time highs. The fundamentals are just not there to support these high market valuations.”
- “Phony rally based on wild expectations of what a Trump presidency really means. The market is way overvalued and heading for a major fall.”
- “The number is meaningless but I do think the market is currently overvalued. Expectations are too high.”
Want to weigh in? Take the survey yourself and see results online at http://www.aaii.com/sentimentsurvey.
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