Yes, this week was painful for stocks.
But putting things into perspective, equities have been more resilient to higher rates recently versus previous periods of rising rates. Source: Edward Jones
Commodities are currently undervalued vs. equities
Source: Vontobel
The S&P 500's performance has been truly outstanding this year.
The index is up 9% year to date which is more than DOUBLE the average YTD return in an election year. In the past, the median return during a US presidential election year was about 11%. There are still several months until the presidential election but the index is on track to significantly exceed its historical performance. Source: The Kobeissi Letter
Equity market positioning is VERY extended (which is bad from a contrarian perspective).
As shown in the chart below, Asset Managers have built the largest equity futures position in history 🚨🚨🚨 Source: Barchart, Goldman Sachs, CFTC
Goldman is embracing the rotational trade as well:
"Sell your Tech Stocks and invest elsewhere" says Goldman Sachs
Yesterday was very painful for diversified 60-40 (equities / bonds) portfolios
Source: Bloomberg
Industrial Metals relative strength (vs. $SPX) ready to turn?
Source: Nautilus Research
Visualizing the growth of $100, by asset class returns across U.S. equities, bonds, real estate, gold and cash since 1970.
source : visual capitalist
