Markets rose on Wednesday.
The S&P 500 rose 0.6 percent to close at a record high for the second consecutive day. The STOXX Europe 600 rose 0.3 percent and the Shanghai Composite rose 0.6 percent.
“What we are seeing is a typical continuation of a Santa Rally, with new money coming into equity funds,” said Quincy Krosby, chief market strategist at Prudential Financial.
Indeed, the Santa rally may well be morphing into a melt-up, according to the usually bearish Jeremy Grantham at GMO.
“I recognize on one hand that this is one of the highest-priced markets in US history,” he wrote in his latest commentary. “On the other hand, as a historian of the great equity bubbles, I also recognize that we are currently showing signs of entering the blow-off or melt-up phase of this very long bull market.”
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