The S&P 500 is up around 10% through late November, which has tended to lead to further gains that build on momentum and seasonality. When the Nasdaq Composite gains 20% or more through this late in the year, it has also tended to keep following through.; Fund managers in a monthly Bank of America survey have turned highly optimistic on the prospect for stocks, but it has been a poor contrary indicator. Likewise, they're betting on small-caps and a steeper yield curve.Signup / Login to read this post
The S&P 500 is up around 10% through late November, which has tended to lead to further gains that build on momentum and seasonality. When the Nasdaq Composite gains 20% or more through this late in the year, it has also tended to keep following through.
Fund managers in a monthly Bank of America survey have turned highly optimistic on the prospect for stocks, but it has been a poor contrary indicator. Likewise, they're betting on small-caps and a steeper yield curve.
The S&P 500 index will soon include Tesla, which will be by far the largest company ever added to the index at the time of inclusion.
U.S. economic conditions continue to improve (this may change depending on how the pandemic plays out). Past-looking data series are still trending upwards.
When Standard & Poor's feels the pressure to add an ultra-large stock to the index, it has typically come after a rally, and forward returns were below average. For the large stocks themselves, once they were actually added to the index, they had a tendency to see lower prices over the next few months.
When Standard & Poor's feels the pressure to add an ultra-large stock to the index, it has typically come after a rally, and forward returns were below average. For the large stocks themselves, once they were actually added to the index, they had a tendency to see lower prices over the next few months.
The 10-day volatility of the average stock in the S&P 500 has jumped, but the 10-day correlation among them has plunged, an extremely unusual setup.
The stock market has mostly only gone in 1 direction since March: up. Since the various pullbacks along the way were very shallow, extremely optimistic sentiment never had a chance to properly wash out. 
Over the past 10 days, the average stock in the S&P 500 has undergone increased volatility. At the same time, the correlation among stocks in the index has declined. This is highly unusual. Likely due to a rotation into smaller stocks, similar behavior has led to further gains in smaller stocks.; The energy sector is trying to change it long-term trend, with the S&P 500 Energy index closing in on its 200-day average for the first time in almost a year, and after suffering its worst-ever spread against that average.
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