What to watch

Investors warily eye ‘everything is up’ market

Everything, it seems, is rising in value on Wall Street. But is that a good thing?

Large stocks, which rise when people feel good about the economy and the future, are up 8.1% in 2017 and within 1.4% of all-time highs. Gold, which is viewed as a haven and tends to rise in uncertain times, is up 8.2%. Long-term U.S. bonds, which usually rise in price when investors question the economy’s growth or seek safety, are up 6.5%, based on the iShares 20+ Year Treasury Bond ETF. Bond yields recently slid to their lowest level since Nov. 10.

“It’s an odd backdrop with asset classes that don’t often move together all rewarding investors this year,” says Todd Sohn, director of technical analysis at Strategas Research Partners.

Typically, one or two of those investments will tank while one soars, he says. In the first half of 2016, a year stocks got off to their worst start ever, gold rallied 25% while stocks rose 2.5%, he says. In 2013, stocks gained 13% in the first half of the year while bonds fell 9% and gold dropped 26%.

Tim Anderson, chief fixed-income officer at Riverfront Investment Group, asked in a report: “Is the bond market sending an ominous warning about the economy at the same time U.S. stocks remain near all-time highs?”

Stocks, Sohn says, could suffer as they enter a “tougher seasonal stretch.” Bonds are a “very crowded trade,” a code phrase for people piling into the same investment. The trend for gold, he adds, is “lackluster at best.”