Sell-side indicator points to increasing bullishness - BofA
- Three major US indexes down more than 1% each
- Energy leads S&P 500 sector declines; consumer staples up the most
- STOXX 600 down 0.9%
- Dollar edges up; bitcoin, gold down; oil sinks
- US 10-yr Treasury yield eases to 3.84%
SELL-SIDE INDICATOR POINTS TO INCREASING BULLISHNESS - BOFA
BofA strategies are out with a note Tuesday saying their Sell Side Indicator (SSI), which they say is a contrarian sentiment signal that tracks sell side strategists' average recommended allocation to equities in a balanced fund, rose in August, improving for a second consecutive month and hitting its highest level in nearly two and a half years.
Equity allocations may have been encouraged by signs of improving market breadth and Federal Reserve Chair Jerome Powell's dovish comments at Jackson Hole, Wyoming, recently.
"The SSI has been a reliable contrarian indicator. In other words, it has been bullish when Wall Street was extremely bearish and vice versa. The indicator is still in 'Neutral' territory but inching closer to a contrarian 'Sell' signal. Following last month's increase, the SSI is the closest it has been to 'Sell' since January 2022," they wrote.
They added that although the sell side has grown increasingly bullish on stocks, positioning data shows funds are bracing for a slowdown.
(Caroline Valetkevitch)
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FOR TUESDAY'S OTHER LIVE MARKETS POSTS
EQUITY INDEX FUTURES EASE AFTER US HOLIDAY WEEKEND - CLICK HERE
WEAK DOLLAR COULD PRESSURE EUROPE'S MEDIA COMPANIES - CLICK HERE
JOBS HURDLE - CLICK HERE
FRENCH EQUITIES LACKING LONG-TERM VISIBILITY - CLICK HERE
GERMAN STOCKS AT ALL-TIME HIGHS, ROLLS-ROYCE REBOUNDS - CLICK HERE
EUROPEAN STOCKS SET TO CREEP HIGHER - CLICK HERE
ISM KICKS OFF THE DOLLAR'S BIG WEEK - CLICK HERE
