Volatility slips to it's lowest level in 2015:

Back to my ongoing theme that Central Bankers (folks below) do not like volatility:

Confidence in equity markets has returned as Central Bankers have spent the first part of 2015 adding monetary stimulus that has pushed global interest rates (except the US) lower.

The US (S&P 500), German (DAX) and Japan (Nikkei) all have made new highs. Investors must be rather confident.

Safe, 10 year Government Bond yields are at near record lows in some spots:

Germany: 0.35%

Japan: 0.43%

Canada: 1.43%

In the US, yields have moved off their lows as the expectation of continued economic strength has bond investors less worried about deflation there.

Earnings of S&P 500 companies, with 391 having reported for Q4 so far, are growing at a rate of 3.1% (vs. expectations of 1.7% at Dec 31,2014). 

Current Price to Earnings (P/E) ratios are close to 18 (vs. the historical average of 14.7).

And despite the expensive P/E, the trend, at the moment, remains intact: higher highs and higher lows:

We shall continue to monitor this closely.

Cheap money is driving stock prices higher, it never pays to "fight" the Central Bankers. It is their trend now. 

What happens when the "music stops"?

Be diversified!

The views expressed are those of the author, Scott Tomenson, a Raymond James Financial Advisor, and not necessarily those of Raymond James Ltd. It is provided as a general source of information only and should not be considered to be personal investment advice or a solicitation to buy or sell securities. Investors considering any investment should consult with their Investment Advisor to ensure that it is suitable for the investor's circumstances and risk tolerance before making any investment decision. The information contained in this blog was obtained from sources believed to be reliable, however, we cannot represent that it is accurate or complete. Raymond James Ltd. is a member of the Canadian Investor Protection Fund