PIMCO's El-Erian: Bull market in U.S. stocks unlikely to last
NEW YORK Aug 7 (Reuters) - Mohamed El-Erian, chief executive of bond fund manager Pacific Investment Management Co, said on Friday that U.S. stock markets are on a "prolonged sugar high" and that the bull market is unlikely to last.
"If we are in a bull market in stocks, it is unlikely to last," El-Erian told Reuters as the Dow Jones industrial average .DJI and Standard & Poor's 500 .SPX each gained 1.50 percent. "I think what we are seeing is just a prolonged sugar high for now," he added.
El-Erian said his concern is that markets have been turbo-charged by temporary and potentially reversible factors, including Federal Reserve programs and fiscal stimulus. He added that Corporate America has been able to surpass earnings expectations by way of layoffs and cutbacks in capital spending. (Reporting by Jennifer Ablan; Editing by Dan Grebler)
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