Rolling 24 Month Correlation Between U.S. Treasury Bonds and Equities Amid high inflation, UST bonds become less effective as a hedge against U.S. stocks, as rising prices erode bond payouts and interest rate hikes lead to a drop in bond prices. Image: BofA Research Investment Committee
S&P 500 and New 52-Week Highs and New 52-Week Lows The improvement in the percentage of S&P 500 stocks at new 52-week highs can be seen as a confirmation of a cyclical bull market. This indicates positive market sentiment and a potential upward trend for stocks. Image: BofA Global Research
U.S. Value Flows Over the past 18 months, outflows from U.S. value funds have been substantial, totaling a record $100 billion. Image: BofA Global Investment Strategy
NAAIM vs. S&P 500 Index Active investment managers, with their portfolios fully invested in equities, are often criticized for their consistent habit of selling at market bottoms and purchasing at market tops. Image: Real Investment Advice
Secular Bull Market – S&P 500 Weekly Chart with the 40-Week MA and 200-Week MA The S&P 500 has reached the 5600s target based on the bullish cup and handle pattern that formed in 2022-2023. The early-2024 breakout to new all-time highs projects further upside potential to the 6150 level. Image: BofA Global Research
Performance – Large Cap vs. Small Cap The durability of the rotation from U.S. large caps to U.S. small caps remains to be seen as the market assesses the implications of changing inflation and rate expectations. Image: Goldman Sachs Global Investment Research
FMS Recession Expectations With economic indicators currently showing some resilience, is it unlikely that the global economy will experience a recession in the next 12 months? Image: BofA Global Fund Manager Survey
Performance – Regional Banks vs. Large Banks Would investors be better served by focusing on quality large bank names rather than trying to find value in the regional banking sector at this time? Image: BofA Global Investment Strategy
U.S. Unemployment Rate Technical analysis suggests an upside risk to the U.S. unemployment rate in the second half of 2024, indicating potential challenges in sustaining job growth and stability in the labor market. Image: BofA Global Research
S&P 500 – Russell 2000 (Small Caps) Outperforms Russell 1000 (Large Caps) by 3% of More Historically, when small caps have outperformed large caps by 3% of more, the S&P 500 has been higher a year later in every instance, with an average gain of 32% since 1979. Image: Carson Investment Research
U.S. Inflation – Core PCE and Core CPI Inflation is trending downward towards the Fed’s 2% target, a crucial aspect of its monetary policy aimed at maintaining price stability and anchoring inflation expectations at a moderate level. Image: BofA Global Research