The markets also picked up after the Commerce Department revealed gross domestic product increased at a 2.1% annualized rate instead of the previously reported 1.9% pace, reports Lucia Mutikani for Reuters.
Some observers, though, argue that investors should keep expectations within reason as the average strategist projects U.S. shares will only gain less than 3% between now and year-end after surging 10.3% since the U.S. election.
The Trump-induced rally has fueled concerns over valuations, with the S&P 500 now trading at 18 times earnings estimates for the next 12 months, compared to the long-term average of 15. Investors are now waiting for the end of the quarter and the start of another earnings season to justify the lofty valuations.
“It’s the end of the quarter and investors are buying whatever little dip that we’ve seen,” Paul Nolte, portfolio manager at Kingsview Asset Management, told Reuters. “The market has been quiet in the past few days and are looking forward to the first-quarter earnings in the absence of any major economic data.”
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