“We’ve Seen this Before” – in 1999, then Stocks Crashed…“A lot of deterioration and decay under the hood”
by Wolf Richter
WolfStreet.com
November 29, 2015
The fourth quarter is normally a very strong quarter, and December exceptionaly strong in the global markets, says Christine Hughes, Chief Investment Strategist at OtterWood Capital. This quarter too, global markets are in the green after a powerful rally in October.
But for the year, the S&P 500 has been stagnating. Wthout the top 10 mega-cap stocks (which are up 14%), the index is actually down 6%. This spread between the top ten names and the rest of the index now amounts to 20%.
“We’ve seen this before,” Hughes says. Last time a spread of this magnitude occurred was in 1999. At that time, the rest of the market was strong. And it ended in a three-year crash. This time, the rest of the market is already weak. Then there’s Glencore, whose collapse would ricochet around the global credit markets and hit stock markets. So here’s Christine Hughes, charts and all:
The Rest…HERE
