These chartbooks capture market themes which presently exist in a vacuum from which the oxygen has been sucked out by fears over the sell-off in bonds, its drivers and implications for monetary policy, and the AI story, which continues to capture the attention of bulls and bears alike. These two themes will continue to dominate the main market narrative as speculation intensifies over whether the data are pulling the Fed towards tightening, perhaps as early as this month, or whether it will ride out the storm with no change in rates. In the AI story, meanwhile, the next big test of the bull market’s strength and resilience will be the much-awaited IPOs of the frontier labs—OpenAI and Anthropic—which require significant and ongoing injections of capital to stay alive, even as they remain the principal conduits through which AI is transmitted to the real economy.
Read MoreThe May 2026 edition of the US equity sector chartbook can be found here, with accompanying portfolio statistics here
I have made quite a few changes to the chartbook since the last time I ran it. I have changed my data provider from Investing.com to SheetsFinance, which makes it much easier to update the spreadsheets feeding the Python scripts that generate this, and any other market-data chartbooks, that I am using. The data now reflect one-year trailing total returns with daily observations—approximately 250 trading days per year. I have also added a cross-correlation rotation matrix, which tracks shifts in sector correlations with IVV, along with chart plots of rolling correlation Z-scores.
Read MoreThe February 2026 edition of the S&P 500 equity sector rotation chartbook can be found here You can read more about the methodology and underlying assets here.
The SaaSpocalypse is upon us and with it comes the inevitable soul searching among investors who thought that a concentrated bet on US/global tech was a never-losing source of excess returns relative to the wider market. This looks to me like a long overdue sell-off in search of a narrative rather than the other way round, but it’s a pretty compelling narrative, all the same.
Read MoreEquity investors are currently in the enviable position of having their cake and eating it too. What if I told you that you could outperform the S&P 500 by investing in market-leading U.S. technology firms—and enhance that outperformance further by adding non-U.S. equities? Sounds too good to be true? Well, yes and no.
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