What stock market’s string of all-time highs says about the future

The S&P 500 was on track Monday for what would be its 26th record close of 2017, but there are conflicting opinions as to whether it’s bullish.

In a Monday note, Sam Stovall, chief investment strategist at CFRA, said that new highs should be cheered rather than feared.

When it comes to tallying new highs, if the index failed to notch any more record closes, 2017 would rank 20th since World War II. On an annualized basis, 2017 would still rank below 1995 (77 new highs), 1964 (62), 2014 (53) and 1961 (52), Stovall said

The benchmark index

SPX, +0.03%

has posted a record close 151 times so far during the latest cyclical bull market, which is about half of the number of all-time highs during the 1990-2000 cycle, according to Stovall, who said the high number of all-time highs is not an indication of future disappointments.

“The S&P 500’s 25th new all-time high serves as a confirmation of investor confidence that the economy and corporate earnings will continue to improve, while inflation and interest rates remain subdued,” Stovall said.

Read: Here’s one reason why expensive stocks can continue to climb

It is difficult to say whether the confidence is about fundamentals, however.

The economy…

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