The S&P 500 rose 0.4 percent on Monday to hit another record high.
Ryan Detrick, chief market strategist for LPL Financial, said in a note to clients on Monday that “we expect corporate America’s efficiency and the strength of the reopening to continue to power earnings ahead and lead to additional gains for stocks over the rest of 2021”.
Bank of America suggested that “the earnings profile is unequivocally strong” and even with moderation, “will still be high enough to present a conducive environment for equities”.
Still, Morgan Stanley’s Mike Wilson sees a 10 percent correction soon in the market.
“With record GDP and earnings growth, rising inflation and the rates of infection from the Delta variant peaking, the Fed will feel more pressure to remove what is essentially emergency monetary accommodation,” he wrote.
BTIG’s chief equity and derivatives strategist Julian Emanuel is also cautious, telling CNBC on Monday that the market’s record price action is mimicking late 1999, and it could spark a 10 to 20 percent correction within the next month.
“Be very much aware of the fact that if and when it reverses, the consequences could be severe,” he said.
Emanuel remains bullish over the longer term “because the long-run trend is higher and pullbacks having been bought have been rewarded all along the line”.
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