Amidst bustling restaurants and bullish equity futures, a deeper scrutiny reveals a market propped up by buybacks and misplaced optimism. JPMorgan’s conservative year-end target for the S&P 500 hints at underlying unease, suggesting a potential downturn ahead. With Goldman Sachs highlighting tightening financial conditions, the facade of market stability may be giving way to underlying pressures, raising questions about the sustainability of current market exuberance.
- Key Points and Potential Implications:
- 40% of trading volume comprises buybacks, raising concerns about market stability.
- Perception of a strong economy based on full restaurants overlooks underlying issues.
- JPMorgan predicts S&P 500 year-end target at 4,200, signaling potential bear market.
- Goldman Sachs notes tightening US financial conditions amid rising bond spreads and volatility.
Sources:
40% of volume is just buybacks.. yet people still believe don’t matter..
People actually believe the economy is doing great because restaurants are full so there is no reason to be surprised
— 🅰🅻🅴🆂🆂🅸🅾 (@AlessioUrban) April 23, 2024
'Asset managers' equity futures positioning has been very bullish.' t.co/P8QH1QSb4r via @SoberLook pic.twitter.com/sqAhCaX0HD
— Jesse Felder (@jessefelder) April 23, 2024
JPMorgan's S&P 500 year-end target is at 4,200, almost 16% lower than currently.
That would also imply a new bear market since the all-time highs.
Is the largest US bank the most bearish on Wall Street?
What do you think, where the S&P 500 ends the year? pic.twitter.com/xAk1CmSpF2
— Global Markets Investor (@GlobalMktObserv) April 23, 2024
According to Goldman Sachs, the US financial Conditions have tightened over the last couple of weeks.
This is the effect of rising bond spreads and volatility as well as the stock market pullback in April.
Either way, financial conditions are still loose. pic.twitter.com/7jhOLsJygS
— Global Markets Investor (@GlobalMktObserv) April 23, 2024
That's the close.
Mission Accomplished. pic.twitter.com/kgPEv8BlT8
— Mac10 (@SuburbanDrone) April 23, 2024