Broad-Spectrum #23: Well well well
The longest bear market ever.. or not?
Welcome to Broad Spectrum Finance.
We have bear markets turning into bull markets. Or just people realizing that the bear market rally was a bull market rally afterall.
We are probably not in the longest bear market of the history.
But where are we, actually? In this issue, we will break down where we actually are in the markets, and what we might be expecting in the coming future. Let’s roll.
Are we on a pause with the FED rate hikes? Are the economies signaling growth? Do we see liquidity increasing?
Everybody is still in buying mode in every asset.
Well, with the exception of bonds, probably.
Bears are still running the show there.
And probably commodities in terms of YTD and 1-year returns.
All markets are sitting in the green in year to date terms. The bigger the names were based on the market cap, the higher their returns are now at the moment. Bluer the chip, greener the performance.
Well, S&P 500 grinded its way up the wall of worry. Year-to-date, it sits at a +18% gain.
And it looks like it is might be still forming a giant base before continuing its solid move higher, as a possible scenario, from the historical standpoint.
Let’s have a look at the inside, in terms of a year-to-date performance:
What we essentially see is tech roaring back. From the beginning of this year, we see TSLA 0.00%↑ up +111%, NVDA 0.00%↑ sitting at +200% performance. Other big blue chip tech is sitting on approximately +40% performance. Very nice. The other industries and individual names? Well, not so much. Although TSLA 0.00%↑ recently had a fall after their release of earnings reports, but that did not take a major tall on the performance, objectively speaking.
That actually a bit worrying, it still implies that the concentrated effect on a handful of stocks on the overall index is still increasing.
And you know, the AI stocks’ effect everybody has been talking about
Interesting times for yield watchers. The spreads have never been in this territory for decades. These days are definitely a one for the history books, folks.
Everybody has been talking about a possible commercial real estate crisis. It is quite possible that we are already in one, or rolling into one. On the flip side, housing does not look all right either.
Obviously partly due to the fact, that mortgage rates are still not turning lower, along with other yields.
However, on the flip side, Global Central Bank Liquidity has been decreasing. Usually, world equities and their price action moves hand-in-hand with that. This might be a possible canary in the coal mine to keep in the back of our minds.
Other markets are moving slowly as well. A lot has been happening in the crypto stage. But we are not seeing outright price action on the back of the developments. Yes, they moved. But the volatility just is not there.
In the next issue of Broad Spectrum Finance, we will look where we might going with this inflation, if there is going to be an actual recession, and what will happen to sectors in the coming weeks and months.
Stay Tuned!