Global head of equity strategy for @Bloomberg Intelligence👨🏻💻 | 2020 Dow Award Winner 🏆 | Lover of hip hop and ankle picks | #Bitcoin
New York, NY
Joined March 2011
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S&P 500 returns in the 3 months pre and post midterms since 1946...
**this is price only returns**
1.8% average before vs 7.5% after
Christopher Cain retweeted
My Bloomberg Intelligence colleagues Jennie and Iza from our equity strategy team put out a note this morning on the stocks most and least correlated to AI. Here's a sample from the note with highest and least correlated quintile stocks:
L/S momentum factor (S&P 500, sector-neutral) has retraced about half of its late summer situational awareness bloodbath.
Still up ~18% on the year tho
Some weird stuff going on under the hood of the S&P 500 right now
None of this is necessarily bearish IMO, but worth watching:
The index looks pretty calm. Underneath, stocks are increasingly doing their own thing.
Record % of stocks with negative 26-week market betas:
Since ChatGPTs 2022 launch, S&P 500 semiconductor margins:
- net income +22.5 percentage points
- operating +25.34pp
- gross +15.58pp
Breadth has been unusually narrow in the recent rally
Not enough to be bearish on its own IMO (we’re within 2% of ATHs after all), but something to watch
Historically, an ~18% 6-month rally would typically have ~85% of stocks above their 200-day MAs... today it’s more like 50%.
Join us! Great opportunity for the right person
Some S&P 500 valuation charts...
TLDR; SPX valuations aren't as crazy as they look at first glance
Big diff between market cap weighted and equal weight valuations (forward P/E). Ratio close to highest in this data. EW valuations are right around medians (compared to itself)
Same deal with margins. Forward profit margins highest since 2000. 67 months in our 316-month sample traded at higher valuations. However, those periods carried a median forward margin of just 12%, 340 bps below today.
Thanks for the highlight @alexandraandnyc !
Loading up on tech isn’t the only path to big gains. Value companies, too, stand a chance of trouncing the market
A portfolio of value, momentum, + upward EPS revisions returned 3,471% since 2000, more than 8 times the S&P 500
Analysis by @PythonTrader
bloomberg.com/news/articles/…
April 2026 ended up being the 5th strongest month for the S&P 500 in the last 35 years ... with most other instances happening after crises (April 2020, April 2009)
And the momentum typically continues, forward 3-6 month returns after the top 10 months outperform the baseline (average of all overlapping x-month returns since 1990)
