May shows a U.S. stock market in a fair value stall – fully valued at the top end of a trading range. Beneath the S&P500 surface, the low bar for Q1 EPS seemed to lead to a lot of upgrades, as did the big turn in steel and iron ore prices, and commodity prices more generally.

May has produced a major shift in sector leaders. Up from the bottom came the Industrials and Materials sectors. I see numerous shifts in Industrial industries and Materials industries across the board. This is worth investigating. Health Care came back to its usual leadership role. Energy, sensing a WTI and Brent oil price stall, stayed Market Weight. The loser sectors, and they weren’t really in the tank, were Utilities and Financials.

A. 3 U.S. Reasons to Remain Bullish on Stocks

#1 Monthly Nonfarm U.S. Payrolls and the Unemployment Rate Stay Bullish

#2 Three Conditions for a Bear Market Are Not Met

#3 The Fixed Income Cupboard is Totally Bare

B. 3 Non-U.S. Reasons to Remain Bullish on Stocks

#1 As Oil Prices Rally, Energy EPS Rises, and High Yield Spreads Come In

#2 Risk-On! International Stocks and Small Caps Can Keep Rallying

#3 A Turn Up in S&P500 Revenue Growth Can Depend on China