Median Excess Return vs. S&P 500 on Day After Earnings Report Strong earnings surprises boosted U.S. stocks in 2Q, but with already high expectations entering the quarter, the price reaction was somewhat limited compared to previous quarters. Image: Goldman Sachs Global Investment Research
S&P 500 Quarterly Margin Growth in the high-margin tech sector, economies of scale, network effects, and supportive financial and regulatory environments—key structural shifts—have pushed the S&P 500’s profit margins to nearly a four-year high. Image: Deutsche Bank Asset Allocation
Market Implied Probability of a Fed Cut The odds of a September Fed rate cut have soared—current market pricing now suggests a very high probability after deeply disappointing U.S. labor market data. Image: TS Lombard
Most Shorted Stocks Relative to Russell 3000 Heavily shorted stocks generally underperform the broader market over the long term, but in 2025, they significantly outperformed, driven primarily by aggressive short covering. Image: Deutsche Bank Asset Allocation
Recession – U.S. Real Retail Sales U.S. real retail sales and consumer confidence trends indicate cautious and subdued consumer spending growth, which has historically been linked to an increased risk of recession. Image: Real Investment Advice
S&P 500 – Hedge Funds vs. Retail Investors The contrast between hedge funds taking short positions and retail investors being long is often seen as a warning of potential equity market weakness over the next one to three months. Image: Bloomberg
S&P 500 Cyclical-Adjusted P/E Ratio vs. Net Private Foreign Inflows to U.S. Equities If foreign capital inflows weaken or reverse, U.S. stock valuations could come under downward pressure as investors reassess risk amid high prices and seek alternatives. Image: Bloomberg
Quarterly Capital Raised by SPACs In the first half of 2025, Special Purpose Acquisition Companies raised $12 billion—a significant increase from the same period in 2024—though still considerably less than in the first half of 2021. Image: Goldman Sachs Global Investment Research
S&P 500 Market Capitalization to Real Disposable Personal Income The S&P 500’s market capitalization relative to real disposable personal income has reached a record high of 28 times, surpassing the previous peak of 25 times observed during the 2021 meme stock frenzy—a level never seen before. Image: Real Investment Advice
Performance of the Magnificent Seven Stocks Following a period of underperformance, the Mag-7 index has almost caught up to the S&P 500, reflecting regained investor confidence in U.S. AI giants despite the challenges posed by DeepSeek’s low-cost AI innovation. Image: Deutsche Bank
Equity Risk Premium and S&P 500 Valuations The current U.S. equity market’s expensive valuations are more grounded in earnings reality than during the late 1990s, but investors should remain cautious due to limited downside protection and valuations ranked at a high percentile. Image: Goldman Sachs Global Investment Research