Again, some optimism is far from indefensible. Global economic data has shown signs of bottoming and a strong U.S. labor market should keep consumers spending. The Federal Reserve has vowed it’s on hold after three 25 basis point rate cuts this year, and is expanding its balance sheet by the week. Bloomberg Intelligence strategists led by Gina Martin Adams don’t see the latest run as the kind of doomed, over-heating melt-up that should elicit worry.

In those kinds of spikes, optimism usually separates from fundamentals, and sentiment drives returns. But corporate profits are expected to rebound next year and the S&P 500’s cyclical adjusted earnings ratio, a valuation multiple based on 10-year earnings also known as CAPE, “may point to improving equities’ value in coming years,” Martin Adams said. The S&P 500 average daily returns and volatility are a little too low to panic over, she added.

Underneath the headline index level, however, more froth is visible, according to Michael O’Rourke, JonesTrading’s chief market strategist. Since early October, 72 companies in the S&P 500 have rallied more than 20%. Tesla Inc. has surged more than 60% over that same time period. Semiconductor company Qorvo Inc. has too, while Apple Inc. has added $225 billion in market-cap -- close to the equivalent of Coca-Cola Co.

“That’s how I know there’s euphoria out there,” O’Rourke said by phone. “The problem is, because of the mechanical nature of the market, I can’t say that this is the end of the move.”

This article was provided by Bloomberg News.

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