Writes:
With October?s tempest behind them, investors are speculating stocks will break out of lockstep moves and start reacting to individual influences such as earnings and takeovers.
The Chicago Board Options Exchange?s S&P 500 Implied Correlation Index has dropped a record 30 percent in November. The gauge, which uses options to measure expectations about whether Standard & Poor?s 500 Index stocks will move in unison, touched the lowest level since the index was created in January 2012 on Nov. 18.
The S&P 500 has rallied 10 percent from a six-month low as improving economic data in the U.S. and central bank efforts around the world alleviate concerns about a possible global slowdown. Investors are now focusing more on company results, dividends, buybacks and deal speculation as drivers for stock prices, rather than economic and political events, according to Jim Paulsen at Wells Capital Management.
?Sentiment is the calmest and most confident it has been in this recovery as the economy is doing better and the stock market is consistently going higher,? Paulsen, who helps oversee $345 billion as chief investment strategist at the firm, said by phone from San Francisco. ?As we get more calm and collected sentiment, there will be more room to make discriminatory bets on winners or losers.?
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