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After a much-anticipated speech last week from Federal Reserve Chair Jerome Powell soothed investors’ inflation fears, equities markets again reached new highs. With Covid cases continuing to rise with the Delta variant’s spread, can the strong markets continue into the autumn?

Both the S&P 500 and the S&P/TSX Composite are up about 20% this year. The major U.S. index has registered more than 50 all-time highs so far, according to a report from BMO Economics, which has happened in only six other years.

More than 10 of those highs were recorded in August, a typically weak month for stocks, economist Priscilla Thiagamoorthy wrote in a research note on Friday.

“While equities are heading into the autumn with solid momentum, the fast-spreading Delta variant remains a major risk,” she wrote. “And, of course, September is generally known as the worst month of any year. But, in a period that has been anything but normal, trends can easily be broken.”

A report from Richardson Wealth also highlighted the perils of forecasting in an unpredictable environment.

“Uncertainty is the bane of the markets and we have experienced a higher-than-normal dose over the past few years,” said the report released Monday.

The higher degree of certainty that came with vaccine breakthroughs, reopening economies, strong quarterly earnings and continued fiscal and monetary support pushed markets higher most of this year, the report said.

“The balance of the year will likely prove more challenging,” the authors wrote, while also noting that forecasting returns is “a humbling exercise.”

A year ago, the S&P 500 was trading at 23 times earnings, suggesting little room for growth, the authors wrote. “Yet fast forward to today and the S&P is up 31% including dividends. Certainly elevated valuation levels alone were not a useful input into returns for the past year.”

Current valuations should still be a concern, the Richardson Wealth report said, and repeating last year’s performance will be more difficult. Even investors who believe economies will continue to reopen and support current valuations should consider that strong returns generally follow poor returns: “Given we are near the upper historical threshold of trailing returns, this does not bode well for future returns.”

The report noted that the trailing performance in Canada and many other equities markets is not nearly as elevated as the S&P 500’s, which may be a good reason to increase global equities exposure and reduce U.S. allocation.