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U.S. bond yields hit a new high, how will the U.S. stock market be affected?
美股牛仔
joined discussion · Mar 2, 2021 16:21 ·

Bank of America: A Warning Against Contrarian Signals! Investors Should Remain Cautious When Wall Street Is Unanimously Bullish on the Outlook

U.S. Stock Market Alert: Wall Street's optimism has surged, reaching levels last seen before past crises. According to Bloomberg, an indicator developed by Bank of America's analyst team led by Savita Subramanian is nearing the threshold for triggering a bearish warning. The metric measures the average equity allocation recommended by sell-side strategists—essentially treating Wall Street analysts' views as a contrarian signal—and is now very close to signaling a sell. The last time this indicator approached "sell" territory was in June 2007, after which it posted a 13% negative return over the subsequent 12 months. We have found that bullish sentiment on Wall Street serves as a reliable contrarian indicator. Currently, returns over the next 12 months are expected to underperform the post-financial-crisis average. - Bank of America analyst team led by Savita Subramanian Although investors currently appear to have grown accustomed to the recent volatility in the bond market, ongoing turbulence could spark fresh concerns—particularly if real interest rates continue to rise, as the current negative correlation between real rates and equity market performance is approaching new highs. $Dow Jones Industrial Average (.DJI.US)$$Nasdaq Composite Index (.IXIC.US)$$S&P 500 Index (.SPX.US)$@今日热门
U.S. Stock Market Watch:Wall Street optimism has surged, reaching levels last seen before the previous crisis.
According to Bloomberg, an indicator from Bank of America's analyst team led by Savita Subramanian is nearing the threshold for triggering a bearish warning.This indicator measures the average recommended allocation to equities by sell-side strategists—essentially serving as a contrarian gauge of Wall Street analysts' views—and is currently very close to triggering a sell signal.
U.S. Stock Market Alert: Wall Street's optimism has surged, reaching levels last seen before past crises. According to Bloomberg, an indicator developed by Bank of America's analyst team led by Savita Subramanian is nearing the threshold for triggering a bearish warning. The metric measures the average equity allocation recommended by sell-side strategists—essentially treating Wall Street analysts' views as a contrarian signal—and is now very close to signaling a sell. The last time this indicator approached "sell" territory was in June 2007, after which it posted a 13% negative return over the subsequent 12 months. We have found that bullish sentiment on Wall Street serves as a reliable contrarian indicator. Currently, returns over the next 12 months are expected to underperform the post-financial-crisis average. - Bank of America analyst team led by Savita Subramanian Although investors currently appear to have grown accustomed to the recent volatility in the bond market, ongoing turbulence could spark fresh concerns—particularly if real interest rates continue to rise, as the current negative correlation between real rates and equity market performance is approaching new highs. $Dow Jones Industrial Average (.DJI.US)$$Nasdaq Composite Index (.IXIC.US)$$S&P 500 Index (.SPX.US)$@今日热门
The last time this indicator approached "sell" territory was in June 2007, after which it posted a 13% negative return over the subsequent 12 months.
We have found that bullish sentiment on Wall Street serves as a reliable contrarian indicator. Currently, returns over the next 12 months are expected to underperform the post‑financial‑crisis average.

- Bank of America's Savita Subramanian analyst team
Although investors currently appear to have grown accustomed to the recent volatility in the bond market, ongoing turbulence could spark fresh concerns—particularly if real interest rates continue to rise—becauseThe negative correlation between the current real interest rate and stock market performance is nearing a new high.
U.S. Stock Market Alert: Wall Street's optimism has surged, reaching levels last seen before past crises. According to Bloomberg, an indicator developed by Bank of America's analyst team led by Savita Subramanian is nearing the threshold for triggering a bearish warning. The metric measures the average equity allocation recommended by sell-side strategists—essentially treating Wall Street analysts' views as a contrarian signal—and is now very close to signaling a sell. The last time this indicator approached "sell" territory was in June 2007, after which it posted a 13% negative return over the subsequent 12 months. We have found that bullish sentiment on Wall Street serves as a reliable contrarian indicator. Currently, returns over the next 12 months are expected to underperform the post-financial-crisis average. - Bank of America analyst team led by Savita Subramanian Although investors currently appear to have grown accustomed to the recent volatility in the bond market, ongoing turbulence could spark fresh concerns—particularly if real interest rates continue to rise, as the current negative correlation between real rates and equity market performance is approaching new highs. $Dow Jones Industrial Average (.DJI.US)$$Nasdaq Composite Index (.IXIC.US)$$S&P 500 Index (.SPX.US)$@今日热门
$Dow Jones Industrial Average (.DJI.US)$$Nasdaq Composite Index (.IXIC.US)$$S&P 500 Index (.SPX.US)$@今日热门
Risk Disclaimer: The above content only represents the author's view. It does not represent any position or investment advice of Futu. Futu makes no representation or warranty.Read more
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