Stocks Inch Closer to 2016's Second Correction

by Michael A. Gayed
Market Watch

Anyone else remember how scary the first few weeks of 2016 were?

I know. That feels like forever ago. We went from the worst start for stocks in history to what has thus far been a pretty decent year for headline averages. High beta/cyclical sectors, emerging markets and inflation expectations have largely pushed higher against the backdrop of bond yields which (still) are not convinced of a better economic future. Everything for now feels calm.

The pre-election melt-up scenario I’ve laid out over the last couple of months has held true. But we may be nearing the exhaustion point in the near term. There are a few things concerning me here which could be very early warning signs that another bout of volatility is coming sooner than later.

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