The stock market had a very positive week. At the same times, bonds fell in value and interest rates rose. Rising rates aren’t much concern while inflation appears low, but rising rates generally accompany a rising market. Further in support, volatility remains low. Taken together, these indicators present a very positive picture of potential growth for the stock market in the near future.

Asset rotation continues to work as expected. The top asset class (of those that I track) is European stocks (XIN), followed again by US small caps (IWM). That’s the same forecast as last week; both of them rose 3% over the past week.

Market Outlook March 11, 2013

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