Investors need to dial back risk-taking as stock valuations are being driven by euphoria, not fundamentals, research firm says

iStock; Rebecca Zisser/BI

• Stock valuations are being driven by investor euphoria, Rosenberg Research says.
• The firm says such stretched valuations are cause for concern, as they're not supported by fundamentals.
• The firm points to several indicators nearing levels last seen in 2021, which was followed by bear market in 2022.

Investors should dial back risk heading into the new year as stock valuations are being supported mainly by euphoric sentiment, Rosenberg Research said this week.