HSBC, the British universal bank, indicates the US stock market has likely found its floor. Max Kettner, the bank's chief multi-asset strategist, suggests the S&P 500's recent low of 6,343 may represent the near-term bottom.
Kettner notes that contrarian bias signals are now strong, indicating a widespread exit from the market. This sentiment, observed across hedging, skews, put-call ratios, surveys, and systematic positioning, points towards a likely market low.
Consumer sentiment and positioning indicators are flashing bullish signs for equities. Kettner highlights that both systematic and discretionary positioning, particularly on the hedging front, have triggered a significant buy signal for broad risk assets. This includes momentum signals and survey data, suggesting investors are over-hedged but not bearish.