The upsurge in forward PE multiples to decade highs since March, particularly in the US, has raised legitimate concerns about the risks of elevated valuations. But drilling down to the sector level—and taking a relative perspective—reveals that this global post-crisis rerating has not been uniform.
With few exceptions, global sector forward PE multiples have also reached some of the highest absolute levels in 10 years. Unsurprisingly, the technology and consumer services sectors have seen some of the most pronounced forward PE re-ratings relative to their 10-year averages (see first two columns in table below).
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