The S&P has jumped by almost 30% since mid-March, its steepest rally since the 1930s, fuelling hopes of a sustainable bull run.
But corporate insiders – who should have a better handle on the prospects for their company than analysts or economists – don’t seem to share this optimism. In the first three weeks of April, executives and senior officers at US firms sold $353m of equities, or 8.3 times more than they bought, according to research firm Washington Services.
The pace of selling was the fastest since the stockmarket peaked in October 2007, while April is also on track to be the slowest month for insider buying since July 1992.
Insiders aren’t infallible, as Alan Abelson in Barron’s points out. But if they thought a turnaround was on the cards, they would be “loath to liquidate their holdings in such an emphatic way”. They are evidently “scarcely enthusiastic about the prospects for a genuine bull market”.