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Sharp rally in infrastructure stocks begins to draw skeptics

Published 11/15/2016, 07:45 PM
Updated 11/15/2016, 07:45 PM
Sharp rally in infrastructure stocks begins to draw skeptics
  • The big gains in infrastructure stocks in anticipation of government spending on roads and bridges in a new Trump administration have some analysts warning that the rally is "getting long in the tooth."
  • Among relevant companies up at least 12% since last Tuesday's election: PWR, FLR, VMC, JEC, MLM, KBR, ACM, SUM, EXP.
  • One former infrastructure bull, Daniel Clifton of Strategas Research, thinks lofty expectations are now priced into the group, adding that the belief that fiscal conservatives in Congress who have long opposed increasing the deficit would suddenly pass a trillion dollars in spending has become too optimistic.
  • Clifton also says Trump’s infrastructure plan in its current form relies entirely on private financing and “has little to do with the actual stocks that are rallying.”
  • Greg Valliere, chief global strategist at Horizon Investments, reminds that "Washington moves slowly on huge projects like this, and there’s a lag time on the economic response."
  • ETFs: XHB, ITB, XLI, PHO, IYT, VIS, XTN, FIDU, IYJ, PKB, FXR, UXI, RGI

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