“Why did God create economists? To make weathermen look good!”
The US economic recovery continues, with the majority of economic data coming in much better than expected. From the more than 10 million jobs beat in the May employment report to a huge beat in retail sales, the economy appears to be coming back faster than most expected.
“The economic data is coming in so much better than expectations that it is making most economists look outright silly in how far off their estimates have been,” explained LPL Financial Senior Market Strategist Ryan Detrick. “Of course, the stock market doesn’t always equal the economy. Wouldn’t it be something if now that the economic data is improving, stocks took a break?”
Looking at 2003 and 2009, two other years that made major equity lows in March, after vicious multi-month rallies off the March lows, stocks consolidated for much of the summer months to catch their breath before eventual moves higher before year end. After a 45% rally off of the lows, we could see something similar play out this year, similar to those two other years.
For more of Ryan’s thoughts on the recent improving economic activity and potential for a summer consolidation, please watch our latest Street View video below.
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