New highs for the S&P 500: So what's next? The index is now up 6 weeks in a row, and is threatening the recent record of seven consecutive winning weeks since hitting its 2009 low. We have had below-normal volume all week, and the December 2012 taper trades have come off. We are back to high-beta names, with old tech (Cisco) out and Internet and tech (Yahoo, Zillow, Yelp, Groupon, Priceline, Amazon, Facebook, Linkedin all up 3 to 7 percent this week) back in.
Is there a big reason to sell? Not right now. Everyone has gone back to being more scared of missing the upside than getting killed on the downside.
What about earnings for next year? It's too early to argue about that, but right now, the market is trading at 15 times earnings, with expectations of earnings growth of roughly 10 percent next year. That is not overpriced.