Category: Daily Instagraph

Robert Shiller coined the famous expression “irrational exuberance” to describe periods where financial markets become increasingly disconnected from underlying fundamentals. The explosion of leveraged single-stock ETFs visible in today’s Goldman Sachs chart is another reminder that parts of the market are again entering a phase where speculation, momentum and short-term positioning dominate rational valuation analysis. … Continued

Markets continue to recover at a speed that would have seemed almost impossible during previous crises. According to JPMorgan, the recent correction linked to the Iran conflict recovered in only 11 trading sessions, making it the fastest recovery after a near 10% decline in modern market history. This says a lot about today’s market structure. … Continued

US markets continue to reach new all-time highs, which naturally creates the impression that “everything is already too expensive.” Yet history suggests a more nuanced reality. As highlighted by this study from J.P. Morgan Asset Management, investing when markets are making new highs has historically not led to weaker long-term returns. On the contrary, over … Continued

Semiconductors now represent almost 18% of the total market capitalization of the S&P 500, up from only 5% four years ago. This extraordinary rise reflects the massive global AI infrastructure race currently dominating financial markets. Hyperscalers are expected to spend close to $1 trillion next year on AI-related CAPEX, mainly in semiconductors, data centers and … Continued

US equities are again trading close to the highest valuation levels of the past 125 years, alongside 1929, 1965 and the late 1990s technology bubble. What is remarkable is that markets remain near all-time highs despite rising long-term interest rates and a difficult geopolitical environment linked to the Iran conflict. At the same time, market … Continued

Nvidia’s Q1 results published yesterday evening were extraordinary. Revenue grew 85% year-on-year to more than $81 billion, data center revenues surged 92%, and gross margins remained around 75%. Very few companies in market history have managed to combine this level of growth with such profitability and pricing power at this scale. And yet the stock … Continued

Bank of America’s latest Global Fund Manager Survey shows the largest monthly increase in equity allocation ever recorded. Investors are rushing back into equities despite rising long-term bond yields, geopolitical uncertainty and growing stagflation fears. History rarely repeats perfectly, but periods of extreme optimism are usually moments where discipline matters most. It is in this … Continued

Bond markets are sending a signal. Long-term yields are rising sharply across almost all developed economies at the same time. US 30-year Treasuries are again above 5%, UK Gilts are close to levels last seen during the Truss crisis, German long-term yields continue to move higher, and even Japan — after decades of ultra-low rates … Continued

European equities are getting cheaper again. The Stoxx Europe 600 now trades at roughly a 30% valuation discount to the S&P 500, well above the historical average. But this gap increasingly reflects a structural divergence rather than a temporary anomaly. The US continues to benefit from the AI CAPEX cycle led by hyperscalers and semiconductors, … Continued

The Shiller P/E ratio on the US market has now moved above 42x, one of the highest valuation readings in more than 150 years of history. The Shiller P/E, also called the CAPE ratio, compares today’s market valuation with the average inflation-adjusted earnings of the past 10 years in order to smooth economic cycles. Only … Continued