Mohamed A. El-Erian , Columnist

How to Make This Stock-Market Rally Last

The hopeful sentiment about liquidity, growth and inflation needs to be followed by action.

December 12, 2016 at 7:00 AM UTC

Mohamed A. El-Erian is a Bloomberg Opinion columnist. A former chief executive officer of Pimco, he is president of Queens’ College, Cambridge; chief economic adviser at Allianz SE; and chair of Gramercy Fund Management. He is author of “The Only Game in Town.”

Still going strong.
Photographer: Michael Nagle/Bloomberg

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The outcome of the Italian referendum last week added to the political, economic and financial uncertainty facing Europe, the world’s largest economic region. Nonetheless, global equity markets shrugged off the turbulence even more quickly than they overcame the shock of the Brexit vote in June.

As a result, U.S. indexes have surged to new highs, adding to an impressive run. Understanding what is, and isn't, at work in this dynamic sheds light on what’s ahead, including ways to reinforce what, until now, have been “fortress markets.”