Summary: All of the US equity indices made new all-time highs this week, for the first time since mid-October. SPX and DJIA have risen 8 months in a row. By some measures, investor sentiment is more bullish now than at any other time in more than a year, driven, apparently, by enthusiasm for tax reform legislation. The current uptrend is extended, and may be getting ready to take a short break, but further gains are likely during the first several months of 2018.

This is the set up as markets enter December, typically the strongest month of the year for equities. As bullish as December tends to be, an intra-month drawdown of 2% has been common, even in recent years.

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For the first time in a month, all US indices - SPX, NYSE, DJIA, COMPQ, NDX and RUT - made new all time highs (ATHs) this week. The dominant trend remains higher. Enlarge any image by clicking on it.

The transport sector and the industrials sector both made new ATHs this week as well, for the first time in nearly two months. Dow Theorists have their confirmation.

In the chart above, you'll see that things are much less rosy in Europe. Stoxx, DAX and FTSE have all broken below their respective 50-d. Recall that fund managers polled by BAML in November where massively overweight Europe and underweight the US, conditions under which we expected the US to outperform (more here).