Global stocks are on track to register the fourth straight month of gains, extending the remarkable sharp and quick recovery from the Covid-19 pandemic-driven lows in March.

This is a market rally that is clearly at odds with underlying economic fundamentals and corporate earnings. We can all agree on the confluence of factors behind the steep gains — unprecedented liquidity from government stimulus efforts, a surge in retail day traders and a lack of viable investment alternatives in a near-zero or negative interest rate world.

While most stocks have rebounded from their earlier lows, there is no doubt that the biggest of gains are focused on select sectors, notably technology and healthcare. Excessive speculation in some of these high-flying stocks is worrying.

To continue reading,

Sign in to access this Premium article.

Subscription entitlements:

Less than $9 per month
3 Simultaneous logins across all devices
Unlimited access to latest and premium articles
Bonus unlimited access to online articles and virtual newspaper on The Edge Malaysia (single login)

Stay updated with Singapore corporate news stories for FREE

Follow our Telegram | Facebook