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"In the event that we see anything else, especially in the case of a hung parliament, we can expect to see a deep correction after such a huge rally".
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All of these stocks can be found in the Third Avenue Value Fund, and all have had deep corrections.
One big question on market psychologists' minds: How will the millions of newcomers to the stock market the ones who didn't experience the 1973-74 crash–reactoto prolonged or very deep corrections?
Of course, a deeper correction is possible in the interim.
Risk of a deeper correction remains high despite a holiday-shortened week.
But barring any nasty event or much deeper correction in the stock market in general that pushes people back into gold, I'm still pretty optimistic.
Standard & Poor's chief investment strategist Sam Stovall believes the recent pullback for U.S. stocks is a temporary one that will top out at 5% to 10% rather than prefacing a deeper correction.
Despite also expecting a near-term pullback, S&P does not foresee a deeper correction and the firm's equity strategy team has a favorable view on more cyclical sectors, with "overweight" recommendations on energy, industrials and materials.
It did make marginal new highs, confirming the price action. The uptrend in the A/D line from late last year was tested last week, and a decisive break of this uptrend would be negative and signal that a deeper correction was underway.
Even deeper corrections are limited by the cranial window size (Supplementary Fig. 7). Figure 1: AO correction via direct wavefront sensing improves morphological imaging deep inside the cortex of a living mouse.
The next decade is likely to have longer or deeper corrections.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com