Nvidia accounts for a staggering 43% of the S&P 500’s gains year-to-date, highlighting the dismal breadth of the market. Many stocks are down while tech continues to monopolize attention, reminiscent of the unsettling patterns seen in 2008. If you’re bullish and believe the Fed will cut rates soon, you must recognize that stocks are now glaringly overvalued relative to long-term Treasury bonds.
We’re witnessing 2007-level overvaluation, as indicated by the 10-year yield minus the S&P earnings yield. The S&P 500’s heavy concentration in its top 10 stocks, surpassing even the dotcom bubble era, threatens market diversification and stability. Any underperformance in these stocks could spell trouble. Bob Kudla suggests that the Federal Reserve cutting rates could trigger either a contagion or a blow-off top in the stock market by Labor Day 2024.
Nvidia accounts for ~43% of the S&P 500's gain YTD.
via @KobeissiLetter pic.twitter.com/AuGuIl3XpT
— AnilVohra1962 🇬🇧🇨🇦🇺🇸 (@AnilVohra1962) June 4, 2024
Breadth is terrible.
Lots of stocks down.
Tech continues to suck all the air out of the room.
— QE Infinity (@StealthQE4) June 5, 2024
If you are bullish and you actually believe that the Fed will cut rates sooner than later, then you have to know that stocks are now egregiously overvalued relative to long-term Treasury bonds.
This is the 10 year yield minus the S&P earnings yield.
2007 level overvalued. pic.twitter.com/G7gnWC5MXu
— Mac10 (@SuburbanDrone) June 5, 2024
🇺🇸 S&P 500
The S&P 500's high concentration in the top 10 stocks, surpassing the dotcom bubble levels, raises concerns for diversification and market stability. Underperformance in these stocks could lead to potential risks
👉 https://t.co/yIk7SZYWVXh/t @GoldmanSachs $spx #spx pic.twitter.com/c6XOYU1I7H
— ISABELNET (@ISABELNET_SA) June 5, 2024
BREAKING: JPMorgan's Kolanovic says the resurgence in meme-stocks like GameStop, $GME, is a bad sign for stock market, per YF.
— unusual_whales (@unusual_whales) June 5, 2024
Bob Kudla gives us his take on the Federal Reserve cutting rates causing contagion or a blow off top in the stock market by Labor Day 2024.
91 views