(Bloomberg) — U.S. stocks were little changed, with the Standard & Poor's 500 Index heading for the longest stretch of quarterly gains since 1998, as investors assessed valuations before data that may show the economy is improving.
The S&P 500 slid less than 0.1 percent to 1,960.53 at 9:31 a.m. in New York. The equity benchmark gauge is up 4.7 percent this quarter, a sixth consecutive gain.
"We do have positive outlook for growth, we're excited about earnings coming in, but it does make us nervous, the lack of volatility and the lack of activity," Anna Rathbun, director of research for CBIZ Inc.'s retirement plan services unit in Cleveland, Ohio, said in a phone interview. The firm manages about $9 billion. "The low interest rates environment is a good breeding ground for asset bubbles. It feels like the calm before the storm."
The S&P 500 trades at 16.6 times the projected earnings of its members, near its highest valuation in four years. It has added 6.1 percent this year and is 0.1 percent away from a record reached June 20.
The Chicago Board Options Exchange Volatility Index added 3.8 percent to 11.26 last week. The gauge, known as the VIX, is near its lowest level since February 2007. The S&P 500 has failed to post a gain or loss exceeding 1 percent for 50 straight days, the longest stretch since 1995.
Quarterly Rebalance
Investors should expect about $20 billion in selling of equities and some buying of bonds as pension-fund managers rebalance their portfolios at the end of the quarter, Boris Rjavinski, a strategist at UBS AG, wrote in a June 23 report.
