Quick market thoughts:Today was a dead cat bounce?Background context: Hedge funds still seem heavily underweight tech re…
Quick market thoughts:
Today was a dead cat bounce?Background context: Hedge funds still seem heavily underweight tech relative to consensus Q3 earnings growth. The recent unwind has flushed out crowded positioning, cut concentration and brought multiples back towards more "normal" levels across Tech/Semis. So while recent weeks have been painful for many people, I think this ultimately leaves positioning in much healthier spot to rebuild longer-term.Moving onto today specifically: Today's flows still show Tech being sold and overall very low activity levels across the board (GS). This is highly typical for the past ~month where bounces higher are mainly due to less fast/urgent selling (i.e. HFs de-grossing) rather than buyers buying....There's nothing to suggest that risk has been added yet.That said...I do feel like we're getting close to the end of this unwind now especially with hyperscalers sticking to capex plans & Q3 semis earnings likely to be positive.The copyright of this article belongs to the original author/organization.
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