NEW YORK ( CNBC) - U.S. stocks are overpriced by 50% but corporate buying is keeping them up, at least until there is a decline in the U.S. fiscal deficit, Andrew Smithers, the author of the book "Valuing Wall Street: Protecting Wealth in Turbulent Markets" wrote in a recent research note. Other analysts, such as Goldman Sachs' Jim O'Neill, said they were optimistic about the prospects for stock markets as the world economy was on the mend due to good data on the U.S. economy. "U.S. equities are around 50% overpriced but, absent unexpected shocks, are being kept up by corporate buying. This should continue until corporate cash flow falls, which is likely to coincide with a decline in the fiscal deficit," Smithers wrote in his research.
By Antonia Oprita, Deputy News Editor, CNBC.com
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