“Things are getting extremely crowded on one side of the boat — the bullish side,” said Matt Maley at Miller Tabak + Co. “Valuation levels are a lousy timing tool. However, sentiment and positioning are better tools. So it’s not out of the question that today’s extreme readings on these issues could create a surprising pick up in volatility before year-end.”
A rally that drove stocks to a series of all-time highs showed signs of exhaustion, with investors awaiting this week’s key jobs report and Jerome Powell’s remarks for clues on whether Federal Reserve officials will cut interest rates in December.
Equities struggled to make much headway, following an over US$11 trillion surge in the US equity benchmark this year that sent the gauge near overbought levels. With a negligible gain on Tuesday, the index notched its 55th record in 2024. Positioning in S&P 500 futures is “completely one-sided,” according to Citigroup Inc.’s Chris Montagu.
