The economy is strengthening — really. True, the long expansion since the recession ended in 2009 has been sluggish, about 2 percent per year. Gross domestic product grew at a 1.4 percent annualized rate in the final quarter of 2015. Analysts believe that, when it is announced in May, GDP for this year's first quarter will inch ahead by only 0.2 percent.
But the first period's minimal advance likely is due to temporary problems, such as in the energy industry. The trend lately has been for a weak first quarter, followed by more robust ones for the rest of the year. That was the case in 2014 and 2015. A stronger economy would help value stocks, as well as those in the industrial and financial sectors, all of them laggards.
Consumer sentiment is healthy. Yes, it is down four straight months in a row, but only by a small amount. This reading tends to be a contrary indicator, meaning that negative results typically lead to a springing back.