FNArena’s Weekly Insights – June 05 2023
In This Week’s Weekly Insights:
-Bull, Bear & Bubble; AI Is The New Kingmaker
-No Weekly Insights Next Week
-Undiscovered Jewel – FNArena Windows
By Rudi Filapek-Vandyck, Editor
Bull, Bear & Bubble; AI Is The New Kingmaker
Is it a bull market? A bear? A transition between the two? What’s with the bubble in Megatech and AI companies?
Whatever the definitions used, a market that is as polarised as today’s breeds confusion among investors and market commentators.
Maybe the safest observation to make is that some parts of the markets are enjoying a positive environment whereas many others are not.
The easiest distinction between the two opposites aligns with the US bond market’s signal that economic recession in the world’s largest economy remains on the horizon. This explains why companies believed to be less vulnerable to significant loss in economic momentum are currently the beez neez for cautious investors.
Cheap valuations are only as cheap as determined by the next downgrade in profit forecasts. Economic recessions are virtually never genuinely priced-in before they actually occur, because we have no idea about the how deep and how long. Which is why cautious investor behaviour is creating different momentum characteristics for distinctive parts of the market.
But wait, there’s (a lot) more.
