Everything is outperforming
The global stock market rally has led almost all sectors and countries' stock indices to outperform cash over the past few months. This is no surprise given that the stock market's historic crash in March has been followed by an equally historic rally. Extremes in one direction typically lead to extremes in the other direction.
Our Fidelity Funds Breadth indicator, which tracks how many Fidelity Select mutual funds have outperformed short-term Treasury bills over the past 3 months, has crossed above 94% (i.e. meaning most funds have outperformed):
When this happened in the past, stocks could pullback or rally further in the short term. But on a 1 year basis, such strong and broad rallies usually led to more gains for the S&P:
Using this same concept, we can see that many developed markets have outperformed the 10 year Treasury yield over the past 3 months. Once again, no surprise here given that the strong rally occurred after a major crash:
When this happened in the past, the MSCI World Index could pullback in the short term, but more often than not rallied over the next year:
As for the S&P 500, the rally has been pretty broad based. 10 of the S&P's 11 sectors have outperformed the 3 month Treasury yield over the past 3 months:
Once again, this usually led to more gains for the S&P 500 over the next 6-12 months.