FILE – In this Feb. 14, 2017, file photo, a rooftop is covered with solar panels at the Brooklyn Navy Yard, Tuesday, Feb. 14, 2017, in New York. In January 2018, the U.S. government moved to tax imported solar cells and washing machines. At a meeting of global business and political leaders in Switzerland, Commerce Secretary Wilbur Ross on Wednesday, Jan. 24, 2018, conceded that China could respond with its own tariffs on U.S. products. (AP Photo/Mark Lennihan, File)NEW YORK – It’s been 365 days since the Dow Jones industrial average first crossed 20,000, and it’s already up another 30-plus percent as the stock market’s relentless rise to records keeps going.
Few market watchers see a sharp reversal for stocks anytime soon, at least this year. But press them on what could possibly derail the market’s run, and they usually land on a similar list of potential threats.
The warnings come couched with caveats: The general expectation is for stocks to keep rising, albeit at a slower pace, because the odds seem low for a recession this year. Economies around the world are finally in sync and growing together, and the U.S. is getting an extra kick from recently passed tax cuts. That should keep profits on the upswing for companies, and stock prices tend to follow the direction of profits.
But many potential potholes lie ahead. One concern centers on just how long and strong this bull market has been. Since they began rising in 2009, stocks have become more expensive than they’ve historically been, relative to corporate profits. That said, stocks have managed to keep climbing in the past, even when they’ve been as expensive and as deep into a bull run as they are now.
Here’s a look at other potential threats that could trip up what’s been one of the best runs for stocks in history: