Interesting call on the melt up!
In theory according to Roger Montgomery "lower interest rates result in a lift to the present value of future cash flows"
So from a fundamental perspective stock prices should be worth more if interest rates are cut?
You only have to look at XUJ since the start of the year, it has been rallying as utility stocks carry a lot of debt & hoping for some relief ?
However when I look at the available data on "how markets react" it still looks like a coin toss either way.
Here is what happened after the 1st interest rate hike ( markets should go down as future earnings our worth less in todays dollars).
Looking back at interest rate cuts we get a result that contradicts Roger Montgomery's fundamental view.
The data from @barchart shows on average it takes around 195 days for the low to form after the first cut.
Personally I try not to have any bias (up or down) & wait for stock prices to show me the way!
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