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Market resilience

As the #apec2023 continues, with both China and the U.S. trying to secure gains from the meeting, the U.S. equity market has found new tailwinds to break the downward trend and has surpassed the September peak. As the chart below shows, the S&P500 has more than tripled over the last 10 years, with 8 mega caps reposbobke for 50% of the movement. Hedge funds, with leveraged bets on mega caps, and particularly on the magnificent seven, are basically all-in on them, leaving very little room for improvement. As a consequence breadth continues to be poor, but the resiliency of this market is remarkable, on the back of a renewed narrative about soft landing and zero chance of ratehikes in December.

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