If the market were to close at current levels, the Dow would log its first finish above 31,000 points, and the Nasdaq would close above 13,000 points for the first time in history.
But anyone worried stocks might be rising too fast for their own good can take a breath, said Thomas Mathews, market economist at Capital Economics. “We still don’t think equity prices look too high relative to expected earnings,” Matthews said in a note to clients.
Interest rates remain low for now, which is good news for stocks because it means borrowing is cheap for companies and investors have few other compelling options.
On top of that, the vaccine rollout and potential additional government stimulus will spark a strong recovery later in 2021, he said.