U.S. Dollar vs. S&P 500 The market is responding positively to good news, as indicated by the recent divergence between the S&P 500 and the U.S. dollar (inverted). This suggests a renewed sense of optimism in the market. Image: BofA US Equity & Quant Strategy
U.S. Dollar vs. S&P 500 Index Forward Price/Earnings Keeping a close eye on the correlation between the U.S. dollar and S&P 500 valuation multiples is essential, especially considering the potential end of the greenback’s bull market cycle. Image: Morgan Stanley Wealth Management
Euro to U.S. Dollar (EUR/USD) The euro’s decrease in value relative to the U.S. dollar seems to be a result of underlying structural factors. Image: Gavekal, Macrobond
U.S. Dollar Index (DXY) BofA predicts that the U.S. dollar has the potential to rally to $105.50/$106 in Q1 2024. A stronger U.S. dollar often poses challenges for U.S. stocks. Image: BofA Global Research
U.S. Dollar Strength vs. Frequency of Reported Revenue Beats A weaker U.S. dollar is correlated with more revenue beats, reflecting the potential benefits of currency depreciation on corporate financial outcomes. Image: Goldman Sachs Global Investment Research
EM/DM Relative Performance vs. U.S. Dollar The strength of the U.S. dollar can affect the relative performance of EM/DM equities. A weak U.S. dollar has historically led to outperformance of emerging market equities. Image: BofA Global Investment Strategy
S&P 500, U.S. 10-Year Yield and U.S. Dollar Index Peaks in the U.S. dollar and U.S. 10-year Treasury yields are seen as essential to catalyze a year-end rally in the S&P 500. Image: BofA Global Research
Biggest Downside Risk to the U.S. Dollar over the Next 6 Months The U.S. dollar is considered to be most vulnerable to the downside risk of a hard landing scenario, which is widely regarded as the primary concern that could negatively impact its value. Image: BofA Global Research
U.S. Dollar vs. Real Interest Rates Higher real interest rate differentials between the United States and the world are generally associated with a stronger U.S. dollar. Image: BCA Research
U.S. Dollar Exposure of Currency Hedge Funds Will hedge funds turn bullish on the U.S. dollar? Image: J.P. Morgan
U.S. Dollar Index and Purchasing Power Parity Fair Value According to the measure of Purchasing Power Parity fair value, the U.S. dollar remains overvalued. Image: BCA Research