The stock market continued one of the more extraordinary rallies in recent memory on Monday, with the major indexes gaining more steam less than two months after one of the most precipitous selloffs in history.
Despite historic unemployment and evidence that the U.S. economy has been in a recession since February, Wall Street remained almost giddy as sectors of the U.S. economy slowly started to reopen. Whatever shape the post-coronavirus recovery looks like, markets that have rebounded more than 40% from their March lows—effectively wiping out their losses—would lead one to believe that the worst is behind us and the recovery is well underway.
But for some investors, it may be too good to be true. Rupert Thompson, chief investment office at London-based wealth management firm Kingswood Group, warns that the markets are “now well ahead of the economic reality” and warns that “a correction remains on the cards over the coming months.”