April 14, 2021 By DeFred Folts III, Managing Partner, Chief Investment Strategist, and Eric Biegeleisen, CFA, Managing Director, Research Portfolio Manager Equities: U.S. Equities: Major U.S. equity market indices continue to reach all-time highs as well as record levels of overvaluation by our measure. However, even at elevated valuations, monetary and fiscal stimulus remains supportive. In addition, high-yield credit spreads remain narrow. A steepening global yield curve is also a positive development signaling higher growth prospects. U.S. equities also continue to benefit, at least in the short-term, from positive price momentum and favorable investor behavior which could be described as market euphoria. The extreme level of overvaluation of the U.S. equity markets continues to highlight their potential downside risk.