One market strategist tossed a bone to the bulls as the bears look to wrestle away control of a red-hot market.
The analysis: A new poll of institutional investors from Evercore ISI strategist Julian Emanuel suggests that extreme fear of missing out (FOMO) remains off in the distance, despite views to the contrary. “Healthy skepticism around the SpaceX IPO rather than ‘wild eyed froth’ continues to ground investors as only 53% of respondents see the next 10% in S&P 500 as up (70%+ has been a contrarian indicator in the past); and only 48% say the Philadelphia Semiconductor Index is a buy here,” Emanuel wrote
Emanuel shared three charts to illustrate his findings: The market, at a glance: A perfect storm of macroeconomic anxiety and tech stock exhaustion has slammed into bullish Wall Street in the early days of June. It began last Friday amid a market plunge that erased more than $1 trillion in semiconductor stock value alone. The selling has extended into overseas markets, including the KOSPI today, with moderate gains in the S&P 500 (^GSPC) and Nasdaq Composite (^IXIC).
The primary catalyst was a hot May nonfarm payrolls report showing 172,000 new jobs added — roughly double Wall Street expectations. It instantly shattered hopes of near-term Federal Reserve rate cuts and reignited fears of another interest rate hike. Compounding this was a bucket of cold water tossed over the AI trade, sparked by a disappointing quarterly outlook from Broadcom (AVGO) that failed to raise full-year custom AI chip targets.