Stocks rose slightly last week. The S&P 500 gained less than 0.1 percent while the STOXX Europe 600 rose 0.2 percent.
Andrew Cinko of Bloomberg said that the US bull market appears healthy and that “buy-the-dip is alive and well as a trading strategy”.
“That resulted in the Nasdaq Composite and S&P Tech indexes setting record highs, while the S&P Smallcap 600 Index ventured into all-time high territory, too,” said Cinko. “When both small and large cap parts of the stock market are stepping higher, it’s a sign the breadth of the advance is broad, and therefore healthy.”
However, one fund manager thinks that small cap stocks may not be able to keep up for long.
Larry Glazer, fund manager at Mayflower Advisors, said that small cap stocks have benefitted from trade war concerns but they may now be at an “absurd and ridiculous premium”.
“Investors are fearful, and they’ve been positioning for the smallest stocks they can get their hands on, and the most domestic stocks they can get their hands on in hopes of escaping this trade war,” said Glazer on CNBC last week.
However, Glazer thinks that US President Donald Trump is “going to make a deal” to end the trade war. “The only people who want a trade war less than the American voters are the American politicians going into mid-term elections,” he said.
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