NEW YORK ( TheStreet) -- As major equity averages power to new multi-year highs or new all-time highs, individual stocks are becoming overvalued fundamentally, and their weekly chart profiles become overbought technically. Recently, this process has resulted in numerous stock-specific downgrades to sell, particularly in the transportation and construction sectors.The stock market has been operating under a valuation watch or warning consistently in 2013. A watch is when 60% to 65% of all stocks are overvalued and a warning is when 65% or more of all stocks are overvalued. Today, this measure is a warning at 65.2%. As an added concern, 15 of 16 sectors have been overvalued, with 14 overvalued by double-digit percentages, led by consumer staples overvalued by 27.1%, transportation by 26.1% and construction by 25.1%.
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