Wall Street may be tearing up the post-World War II page.
According to RBC Capital Markets’ Lori Calvasina, stocks may be ignoring all signs of a recession.
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“If you go all the way back to 1945, it was the post-World War II recession, and the stock market just went through it,” the firm’s head of U.S. equity strategy told CNBC’s “Fast Money” on Monday. “It’s the only recession that’s been largely ignored.”
In a research note released this week, Calvasina looked at the performance of the S&P 500 during the recession dating back to 1937. She found that the 1945 recession was the only one without a market correction.
RBC US Equity Strategy, Haver
She cited the parallels between government war funding in 1945 and massive Covid relief in 2020 and Fed rate hikes as a few examples.
“I actually found some interesting similar terms. It was described as a technical recession, just driven by the fact that the wartime economy shut down, and we are moving to a peacetime economy,” Calvasina said. “(This) idea of an artificial recession that we were all talking about last year, you really had it.”
However, she also acknowledged the differences between the two periods, noting that she does not believe in a bull market.
“I actually think we priced in a recession at the October lows, but I think people are tired of hearing that,” Calvasina noted.
she S&P 500 Index The year-end target price is 4,100. She last week revised her S&P EPS forecast to $200 from $199. The S&P closed at 4,135.32 today, up more than 8% so far this year.
