Dow 46,000? WYNN a screaming buy?
The Dow Jones industrial average index (DJIA) opened the year at around 24,800 and closed Friday at 26,616. In less then a month it has risen 1,816 points and the month has a few days left. If it keeps going at this historically unprecedented pace, it will end the year around 46,500. Will it happen? It could!
But there are many people proclaiming that the markets are over heated and way past due for a correction. In fact, those people that do historical analysis of the market performance have stated that today the market is more overvalued than it was in 1929, 2000 and 2007. Those years were peaks before major pullback and of course 1929 was the start of the Great Depression.
But can we look back on markets and the historic performance and say that it did X in the past so X will happen again? I am going out on a limb here and saying, No! The information exchange today with the global communications networks is instantaneous this permits stocks, and the markets, to provide instant changes to individual stock valuations. Take for instance what happened to Wynn Resorts (WYNN: NASDAQ) on Friday. Over an “allegation” that the 76 year old CEO had in the past had improper sexual relations the stock feel over 10%. If true I am sorry for all parties involved.
WYNN looks like a buying opportunity when it bottoms sometime next week. Wynn It is a world wide organization with a great management team, board of directors, reputation and it is making money and expanding. This stock is heading up in my opinion.
Back to will the Dow hit 46,000 this year. I think there is no chance. But I do see a bull market continuing. Global and US GDP are on the rise. North Korea is making nice with South Korea. Trump’s tax bill is a mega boost to corporate earnings and repatriation of billions of dollars into the economy. If the Infrastructure Bill gets passed we may see 46,000.
There will be black swans along the way for certain. But the market is a mega bull with titanium horns and body plating slaughtering every matador in its path, the bodies are everywhere.