U.S. Stock Market Bull and Bear Indicator – S&P 500 Last Friday, our Stock Market Bull & Bear Indicator was bullish well before the opening bell, and the S&P 500 followed through, ending the day up 0.59%. Using multiple financial data, this great model helps investors navigate through different market conditions. It suggests whether the…
Sentiment Indicator and Stock Positioning Goldman Sachs’ U.S. Equity Sentiment Indicator has slipped to -1.3. Historically, similar readings have been followed by an average 2.0% gain for the S&P 500 over the next month. Image: Goldman Sachs Global Investment Research
Valuation – S&P 500 Forwad P/E Ratio vs. ISM Manufacturing Prices Paid (Leading Indicator) The ISM Manufacturing Prices Paid Index came in hotter than expected, raising a warning flag for equity valuations. Historically, rising manufacturing prices have been followed by lower S&P 500 fwd P/Es over the next 6 to 12 months. Image: Bloomberg
Sentiment Indicator and Stock Positioning Goldman Sachs’ U.S. Equity Sentiment Indicator has slipped to -0.9. After similar readings, the S&P 500 has historically averaged a 0.5% gain over the following month. Image: Goldman Sachs Global Investment Research
U.S. Heavy Truck Sales and Recessions (Leading Indicator) U.S. heavy truck sales fell in August to 413K (annualized). Before recessions, heavy trucks sales tend to peak and then decline, providing insights into the overall health of the U.S. economy as a leading economic indicator. Click the Image to Enlarge
Risk Appetite Indicator Level and Momentum Factors Goldman Sachs’ Risk Appetite Indicator has climbed and is approaching stretched territory as investors pile into higher‑risk trades. Riding the upside can pay off, until the crowd is in the same trade. Image: Goldman Sachs Global Investment Research
Different Market Sentiment Indicators Current market sentiment indicators are stuck in neutral, with bullish conviction matching bearish caution. Image: Goldman Sachs Global Investment Research
Global Financial Tightness Indicator vs. ISM Manufacturing PMI SA Tighter financial conditions are starting to hit manufacturing sentiment and order flow. If the squeeze persists, the ISM Manufacturing PMI could weaken further, adding pressure to risk assets. Image: Bloomberg
U.S. ISM Services Prices Paid Index vs. U.S. CPI Inflation (Leading Indicator) The ISM Services Prices Paid Index, which typically leads U.S. CPI by around three months, just surged to its highest level since 2022. Inflationary pressure is building in the pipeline. Image: Deutsche Bank
U.S. Equity Risk Indicator and S&P 500 The U.S. Equity Risk Indicator is flashing red, warning that the S&P 500 may be running hot. History shows that once this metric hits extreme levels, significant equity drawdowns often follow. Image: BCA Research
S&P 500 vs. G10 Excess Liquidity Leading Indicator G10 excess liquidity is still in negative territory, and that’s bad news for U.S. stocks over the next three to six months. As the liquidity backdrop fades, equities lose a crucial support. Image: Bloomberg