US stocks at record highs, at risk of stalling or breakout?

Stocks were mixed on Monday.

In the US, the Dow Jones Industrial Average and the S&P 500 both rose 0.3 percent to close at record highs. The Nasdaq Composite rose 0.6 percent to also close at a record high.

European stocks were flat though while the Nikkei 225 fell 0.3 percent after a report on Monday showed that Japan's economy stalled in the April-June quarter.

However, the Shanghai Composite surged 2.4 percent after the China Securities Regulatory Commission said on Friday that the Shenzhen-Hong Kong Stock Connect scheme would be launched this year.

While US stock indices are at record highs, some analysts think that the market may be about to stall.

"There is some risk that we're approaching stall speed here," Art Cashin, director of UBS floor operations at the New York Stock Exchange, told CNBC on Monday.

Allianz Global Investors' Kristina Hooper also told CNBC that there are "certainly a lot of question marks" around the rally but added that "stocks are the most attractive asset class among a sea of relatively unattractive asset classes".

Similarly, Mary Ann Bartels, head of portfolio strategy at Merrill Lynch Wealth Management, said she expects greater "episodic volatility" but thinks that there "is no other alternative" to US stocks.

And yet, Bloomberg points out that there are features in the latest rally that is making the bull market look more sustainable.

From last week’s confluence of record highs to rebounding growth stocks, there’s a lot to like in a market as hated as this one.

No longer are low-volatility stocks the leaders. Nor are utilities, or companies that sell toothpaste and handsoap. Nary a defensive share is rallying as leadership in the S&P 500 Index switches from the dividend-paying bond surrogates that ruled 2015 to technology, banks and commodity firms that benefit from an expanding economy.