Category: Daily Instagraph

As we have repeated many times, US equity market valuations remain stretched — both compared to their own history and versus the rest of the world. For now, investors seem comfortable with this premium as earnings growth of US companies, particularly in technology, continues to deliver. US exceptionalism and the AI revolution remain the driving … Continued

Time to revisit equity market valuations. At ECP, we recognize that valuations may not dictate short-term market moves, but they remain a key driver of long-term investment returns. The picture is clear: the U.S. market, fueled by U.S. exceptionalism, is trading at the highest valuation levels and well above its historical range. Other regions also … Continued

Long-term interest rates are rising across the globe. In principle, higher yields simply reflect the time value of money and stable inflation expectations. But today, they are telling a different story. Bond vigilantes are increasingly questioning the ability of governments in France, Japan, the UK, and the US to manage ballooning budget deficits and refinance … Continued

Time to take stock after the summer break. US equity markets have staged a remarkable comeback following the uncertainty triggered by Trump’s tariff announcement on “Liberation Day.” For market historians, the rally in the S&P 500 ranks among the strongest of the past two decades – surpassed only by the rebounds after the Global Financial … Continued

As Peter Lynch, legendary Fidelity Magellan Fund manager, once said: “Far more money has been lost by investors preparing for corrections, or trying to anticipate corrections, than has been lost in the corrections themselves.” Historically, for the U.S. stock market, the data is clear: the longer you stay invested, the lower the probability of loss. … Continued

In his book Irrational Exuberance, Professor Robert Shiller introduced the Shiller Price-to-Earnings ratio, a valuation metric that smooths market earnings over ten years and adjusts them for inflation. The goal is to provide a more normalized view of how expensive the stock market truly is. Today, this measure stands at 38.8 times earnings—its second-highest level … Continued

For a long time, the euro exchange rate was seen as one of the main levers for European equities. That link is breaking down. Bloomberg data show that the historically tight correlation between the EUR/USD and the Euro Stoxx 50 has faded and is now close to zero. This marks a shift. While equities in … Continued

Today’s chart shows the S&P 500 trading at 5.3x price-to-book value — the highest multiple on record, surpassing even the dot-com bubble. While this highlights how stretched US equity valuations appear, two caveats are important: 1) book value is an imperfect yardstick, especially in an economy driven by intangible assets and technological innovation, and 2) … Continued

NVIDIA now holds the largest weight in the S&P 500 ever achieved by a U.S. company. This is what happens when a technology leader combines a genuine edge in innovation with dominant market share in a rapidly expanding AI sector — and consistently delivers on earnings. The trailing P/E of 58 looks steep, particularly for … Continued

The latest BofA Global Fund Manager Survey shows a clear portfolio shift going into the second half of the year. Global managers have cut exposure to healthcare, European equities, and REITs, while adding to emerging markets, Japanese stocks — and notably, the U.S. The “great rotation” into Europe, which gained traction earlier this year as … Continued