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Haverford CIO: 'We are not in euphoria yet,' market is driven by earnings

  • The stock market hit record highs on Thursday, but expert Hank Smith said he isn't concerned about it getting carried away.
  • He said the market is paying attention to what is important, like accelerating economic growth, and ignoring what isn't really important, like geopolitical events.
  • "We are not in euphoria yet," he said.

The stock market hit record highs on Thursday, but expert Hank Smith said he isn't concerned about it getting carried away.

He said the market is paying attention to what is important, like accelerating economic growth, and ignoring what isn't really important, like geopolitical events.

"The market on a forward multiple isn't that much more expensive today than it was a year ago. So it's earnings that's driving this market. We are not in euphoria yet," the chief investment officer at Haverford Trust said in an interview on "Closing Bell" on Thursday.

Earlier Thursday, billionaire activist investor Carl Icahn told CNBC he thinks the market "has gotten into a euphoric state."

Optimism over tax reform propelled stocks higher on Thursday, with the Dow Jones industrial average surging 331.67 points to close above 24,000 for the first time. The odds of success increased for the Republican Senate tax bill after Sen. John McCain said he would support the legislation.

Paul Hickey, co-founder of Bespoke Investment Group, told "Closing Bell" the market is finally starting to price in tax reform. Therefore, going forward if there are bumps in the road, it could spell trouble.

However, he said the bull market has taken on all the doubters.

"Just today almost 25 percent of stocks in the S&P 500 hit a 52-week high. That's the strongest reading we've had since the first half," he said. "When you look at prior years where you've seen this type of trading pattern ... in the first 11 months of the year, the year typically ends off on a strong now with small to minor declines if you have any."

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