MINNEAPOLIS (Stockpickr) -- Market participants like to try to explain directional moves in stocks. Whether up or down, there always seems to be a reason for the move. Often the reason is simply encapsulated in a major headline.
For example, strong economic numbers such as employment data are often given as a reason for stocks moving higher. Or when stocks move lower, some fear-based event, such as higher inflation or a terror event or some other crisis, is usually given to explain the move.
In my opinion, sensational headlines miss the mark in explaining a stock's move. The main reason a stock moves up or down is related to its valuation and often has nothing to do outside events. But for some reason, valuation is usually far down on the list explaining stock moves.
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