SPUU - Taking Stock: Q4 2021 Equity Market Outlook

• The summer saw some reversal of the “reflation trade,” a strong uptrend by economically sensitive stocks that kicked off with vaccine announcements last November.
• Fears centered on the Delta variant and its potential economic impacts. Concerns that earnings, valuations and GDP growth are at or near peak levels also weighed heavy. Our view is that peaks are inevitable, but they don’t suggest a cycle’s end.
• Share buybacks are on pace to rival 2018’s record levels. And after a tumultuous year for dividends in 2020, we are seeing a historically high proportion of Russell 1000 companies raising and reinitiating dividends this year.
• We see strong underpinnings for equities in the months ahead, and advocate a focus on quality and stock selection to capture opportunities in those companies with solid underlying fundamentals.

For further details see: