Stock market’s future: Bubble or bounce?

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Today marks the new bull market's first anniversary, but analysts are undecided as to whether the market has worked off years of excessive prices and can return to steady growth.

Optimists argue that two brutal bear markets have left stocks cheap and attractive, especially if the government's economic-recovery initiatives succeed. They say investors who were too optimistic in the 1990s are too pessimistic now, and that a recovery in corporate performance could offer investors happy surprises, according to an article in The Wall Street Journal.

But some of those who warned of trouble a decade ago are worried again today. They say government interventions in the economy and the market in 1998, 2001 and 2008 kept stocks from fully correcting. Some see signs of bubbles starting to inflate again, notably in certain developing-country stocks, the article says.

The Dow stood at 10,568 in mid-morning trading, up from its close Monday of 10,553. Its 52-week high and low are 10,767 and 6,440 respectively.

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Click here for a MarketWatch article on the anniversary.