Wall Street Bullishness Is Becoming a Contrarian Sell Signal
- BofA says excessive optimism is a reliable contrarian sign
- Its gauge of bullishness now points to below average returns
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Stock market optimism among Wall Street strategists has risen close to levels that signaled trouble for equities in the past.
A Bank of America measure of their bullishness is near a level that historically has been bearish for stocks. The gauge assesses the average recommended allocation to equities by sell-side strategists and is very close to triggering a sell signal, a team including Savita Subramanian wrote Monday.