U.S. Share of Global Equity Market The U.S. share of the global equity market has significantly increased. While this concentration has benefited investors with high U.S. exposure, it also raises concerns about proper diversification and exposure to other markets. Image: Goldman Sachs Global Investment Research
Equity Market Concentration – Market Capitalization of 10 Largest Companies as Share of S&P 500 Total Concerns about overconcentration risks are growing as the top 10 stocks in the S&P 500 hold a significantly larger weight in the index than their share of earnings would suggest. Image: Goldman Sachs Global Investment Research
Sentiment – Risk Appetite and Expected U.S. Equity Market Performance Amidst mounting political, macroeconomic, and policy uncertainties, U.S. equity investors have dramatically increased their risk aversion in February, signaling a cautious market outlook. Image: S&P Global Market Intelligence
Ownership Breakdown of the U.S. Equity Market (Share of Corporate Equity Market) U.S. households hold 38% of the U.S. equity market, reflecting strong confidence in stocks. However, ownership is concentrated, with the wealthiest 10% owning about 93% of all stocks owned by households. Image: Goldman Sachs Global Investment Research
Valuation – U.S. Equity Market Capitalization to GDP The U.S. equity market cap to GDP ratio is near an all-time high at approximately 187%, suggesting a significant overvaluation of the U.S. stock market. Image: Goldman Sachs Global Investment Research
Do You Believe the Risk of an Equity Market Correction at Some Point Over the Next 3-6 Months Is High or Low? JPMorgan’s survey reveals that 82% of their clients anticipate a high likelihood of an equity market correction within the next 3-6 months. Image: J.P. Morgan
When Do You Expect the U.S. Equity Market Will Peak? 77% of financial advisors believe the bull market will continue beyond 2024, as they expect stellar corporate results, easy financial conditions, and lower interest rates to support its continuation. Image: BofA US Equity & Quant Strategy
Gold – Beta of USD/xxx to Equity Market Volatility Related to Government Spending Gold has been a very good hedge against debt ceiling worries in the past. Image: Deutsche Bank
Equity Market Volatility Related to Uncertainty over Government Spending Equity market volatility may spike when the debt ceiling is under discussion. Image: Deutsche Bank
Money Market Fund Assets as a Percent of S&P 500 Market Capitalization Cash on the sidelines is not elevated relative to the S&P 500 market capitalization. Image: Morgan Stanley Wealth Management
Total Equity Market Capitalization per Country The United States has the largest equity market capitalization in the world (over $41 trillion as of December 31, 2022). Image: Goldman Sachs Global Investment Research