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NEW YORK: As Joe Biden takes over the presidency, investors are trying to determine how much fuel is left in trades betting on his policies, which have sparked outsized rallies in everything from cyclical stocks to shares of solar-powered companies.

Overall, the broad S&P 500 has rallied nearly 13% since the Nov. 3 presidential election, with gains concentrated in sectors expected to benefit the most from policy shifts expected under a Biden administration.

While stimulus, green policies and infrastructure have pushed the broad market to record highs, some investors are growing concerned that the rally may have run too far ahead.

Democrats’ slender majority in Congress mean the final shape and timing of many Biden policies – including a proposed $1.9 trillion stimulus package – remain uncertain. Meanwhile, valuations on the S&P 500 are approaching levels last seen in the Dotcom era, while hiccups in the U.S. vaccine rollout have dented optimism over a broad economic reopening.

“If you ask me to predict if the next 5 to 10 percent move is more likely up than down, I would say it’s more likely down,” said Ernesto Ramos, head of equities at BMO Global Asset Management….

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