Up, up and away–that’s how the latest rally in equities feels. Coming in the wake of Brexit and a whole host of other factors, bull markets really do climb a wall of worry.
For starters, lingering anxieties over the survival of the EU, the euro, and fears Italian banks will implode are just some of international concerns that are preoccupying investors. Then we have negative interest rates and any ominous message(s) global bond markets may be trying to send.
There’s always the tepid U.S. economic recovery and nagging fears that central banks are out of ammunition.
But nothing seems to have deterred investors during July.
Instead, the Street has warmed up to the idea that Q2 will mark the end of the profit recession. And the economic expansion, which isn’t young anymore, still has some life left in it.
But let’s not stop there. Fed rate hikes are expected to be gradual, and companies can’t seem to stop gorging on their own shares via buybacks.
All in all, it has been a perfect recipe for a summer rally.