The S&P 500 reached new all-time highs last week, recovering from a July momentum stock bust after churning in a 3% range for nearly three months. The liquidation of hedge fund Situational Awareness following its leveraged AI-hardware positions unwind served as the kind of market ritual that often precedes a low. S&P 500 second-quarter earnings surged 47%, with nearly 20 percentage points coming from unrealized gains totaling $140 billion from Alphabet and Amazon investments in Anthropic and SpaceX. However, analysts David Snyder and Tim Hayes of Ned Davis Research warn that the market is exhibiting topping behaviors, with conditions described as overbought, overowned and overvalued at historical extremes not seen since previous secular market peaks.
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