TME Weekend: Lowest in 20 years

Who is hot & who is not over the past 70 days

Sector and industry group returns since March 8th.

Source: FactSet

Concentration

"MAGMA collectively now make up 15.5% of overall US single stock net exposure on the Prime book (vs. 9.7% at the start of 2023), the highest level since Jul '21 and in the 89th percentile vs. the past five years."

Source: Goldman

Lowest in 20 years

The Morgan Stanley QDS team highlights that market breadth is at the lowest levels seen over the last 20 years as index returns have been driven by a handful names. 

How long can AI carry the world?

"While the S&P is up ~10% YTD, it’s been one of the narrowest rallies on recent record with many of the AI beneficiaries up >25% YTD. In fact, without these AI leaders – Microsoft (MSFT), Alphabet (GOOGL), Nvidia (NVDA)*, etc. – the index would actually be down slightly" (MS trading desk)

All CB curves topping out

Central bank assets as a share of GDP.

Source: Haver

The rallies in 2000-2002

35%

12%

25%

41%

45%

That is how much the market rallied while ending up -79% and finally setting a low. Anything is possible....

Not expensive on "next year"

GS has $237 in EPS for SPX 2024. For the ones that are not that good in math, 2024 is only 7 months away....."Less than 18x at the beginning of a new booming AI lead economy...." (our quote, not GS)

Source: Goldman

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