Valuation

MARKET CALL: A Loopy Stock Market

Feb 22, 2026 4 min read paid

The equal-weight S&P 500 has been rising to record highs since the beginning of the year, while the market-weight S&P 500 has been literally loopy just below 7000 over the same period (chart). This has been mostly attributable to the stock market's rotation in the type of outperforming stocks, from high-tech to low-tech industries. Previously, the former were supercharged by expectations that companies involved

Ed Yardeni

The Great Valuation Rotation Of The Roaring 2020s

Feb 17, 2026 4 min read paid

For most of the time since the pandemic, large-cap stocks have outperformed their smaller counterparts in the US stock market. That is, the LargeCap S&P 500 index has outperformed the MidCap S&P 400 and SmallCap S&P 600, collectively the “SMidCaps.” That started to change late last year as investors increasingly concluded that the former's earnings outlook had become riskier and its valuations

Ed Yardeni

Will SMidCaps Outperform In 2026?

Jan 6, 2026 3 min read paid

Will the S&P 400 MidCaps and the S&P 600 SmallCaps (i.e., SMidCaps) finally outperform the S&P 500 LargeCaps this year? Maybe. They’re overdue to do so. However, we think investors would be better off focusing on select SMidCaps sectors rather than the broad indexes. We would overweight the same SMidCap sectors as we recommend overweighting in the S&P 500: Financials,

Ed Yardeni

MARKET CALL: 1920s And 2020s Not The Only Roaring Decades

Jan 2, 2026 4 min read

Goldman Sachs has been pushing the view that the stock market's return over the next 10 years is likely to be very low, at only around 3% per year. We disagree. Admittedly, there's logic to that forecast: The forward P/E of the S&P 500 is currently historically high at 21.8 (chart). That suggests that it's likely to fall in the

Ed Yardeni

Home Stretch For The Holidays

Nov 11, 2025 3 min read paid

The S&P 500 closed at 5881.63 at the end of last year. It is up 16.2% since then to 6846.61 today (chart). That beats the average 10.4% ytd gain at this point in the year over the past 10 years. The average annual increase over the past 10 years was 12.3%. If this turns out to be an average year, then the S&

Ed Yardeni

Bubble, Bubble, Toil & Trouble

Oct 22, 2025 4 min read paid

A few weeks ago, we observed a bubble in fears of a bubble. The fearmongers see an "everything bubble" that will soon burst. The expression "the bubble in everything" began gaining traction during the tenure of Federal Reserve Chair Janet Yellen (2014–2018), but it became widely associated with Jerome Powell's leadership and the monetary stimulus of the 2020–2021 pandemic era. In other

Ed Yardeni

What Is The Stock Market Discounting?

Oct 2, 2025 3 min read paid

The stock market is discounting the ongoing resilience of the economy and corporate earnings. It is discounting that the odds of a recession over the rest of the Roaring 2020s are low. The longer the economy is expected to grow without a recession, the more sustainable high valuation multiples can be, since earnings growth can be expected to justify those valuations (chart). High valuations don't cause bear markets.

Ed Yardeni

Powell's Irrational Exuberance Moment

Sep 23, 2025 2 min read

During a speech in Providence, Rhode Island today, Fed Chair Jerome Powell was asked whether he and his colleagues give any weight to the impact of their monetary policies on financial markets. He responded: "We do look at overall financial conditions, and we ask ourselves whether our policies are affecting financial conditions in a way that is what we're trying to achieve.” Then he opined that "

Ed Yardeni

Earnings-Led Meltup?

Sep 8, 2025 3 min read paid

Ed Yardeni

Is the Bull Market In Stocks Finally Broadening?

Aug 25, 2025 3 min read

The Magnificent-7 stocks have been leading the charge of the current bull market that started on October 12, 2022. They are all in the Nasdaq 100, which is up 117.9% so far since the start of the bull market, beating all the other major US stock market indexes (chart). The Mag-7's market capitalization share of the S&P 500 has doubled during the current bull market

Ed Yardeni

What's In Style?

Aug 13, 2025 2 min read

Are SMidCaps coming back into fashion? They had a good day today. They outperformed the LargeCaps. The S&P 500 LargeCaps was up 0.3%, while the S&P 400 MidCaps and the S&P 600 SmallCaps rose 1.6% and 2.0% (chart). The Russell 2000 SmallCaps rose 2.0% as well. That led lots of market commentators to declare after the close that the SMidCaps

Ed Yardeni

MARKET CALL: Is The Sky The Limit?

Aug 10, 2025 3 min read paid

The S&P 500 nearly matched its July 28 record high on Friday. The Nasdaq did rise to a record high. Once again, the Magnificent-7 stocks collectively are leading the pack. That's because these remarkable companies continue to deliver magnificent earnings, which are increasingly being driven higher by the demand for cloud computing as AI increasingly powers the Digital Revolution. The sky seems to be the limit

Ed Yardeni

Page 1 of 4