U.S. vs. Developed Market Equities (ex-US) Price Relative While there is potential for U.S. equities to maintain their lead in the near term due to strong earnings and market dynamics, historical cycles suggest that this dominance may wane as international markets recover and valuations adjust. Image: BofA Global Investment Strategy
Market Capitalization of Six Largest Companies as Share of S&P 500 Total With the six largest companies accounting for 29% of the S&P 500’s total market capitalization, discussions about diversification have become increasingly relevant. A well-diversified portfolio is vital for effective risk management. Image: Goldman Sachs Global Investment Research
Market-Implied Change in Fed Funds Rate Traders are anticipating a significant shift in the Fed’s interest rate policy, predicting a total of 223 bps in cuts over the next 12 months due to weakening economic indicators, such as rising unemployment and easing inflation. Image: Goldman Sachs Global Investment Research
Fed Funds Forecast vs. Market Pricing While the Fed has made progress in the fight against inflation, BofA holds a significantly more hawkish view on Fed policy compared to market expectations. Image: BofA Global Research
Current Market Pricing for Fed Funds Rate Traders predict that the Federal Reserve’s terminal rate, which marks the end of the rate cut cycle, will be around 3%. Image: BofA Global Investment Strategy
Short Interest as % of Market Capitalization S&P 500 Median The median short interest in the S&P 500 has fallen to 1.8%, a relatively low figure suggesting that market participants are largely optimistic or, at least, not significantly bearish regarding its future performance. Image: Goldman Sachs Global Investment Research
Implied Equity Allocation by Non-Bank Investors Globally Despite concerns about potential economic slowdowns, investors are currently maintaining an overweight position in global equities, suggesting a positive outlook for stock markets. Image: J.P. Morgan
All Money Market Funds Total Net Assets Investors currently hold $6.22 trillion in money market funds, a figure that is being interpreted as contrarian bullish for the stock market. Image: BofA Global Research
Active Global Equity Fund Flows and % MSCI ACWI Members Trading Above 200-DMA Flows to active global equity funds correlate strongly with stock price dispersion. Higher dispersion creates more opportunities for active managers, especially in volatile markets, boosting investor interest and inflows. Image: BofA Global Investment Strategy
Earnings Sentiment (Analyst Upgrades Minus Downgrades Across Markets) Earnings sentiment in the S&P 500 is steadily improving, potentially paving the way for market growth. Image: Goldman Sachs Global Investment Research