00:00It's still a bit of a stock picker's market.
00:01I mean, we've seen that earnings breadth come through
00:03and the love for the MAG7 stocks has dissipated
00:07and people are seeing a more sort of universal earnings breadth
00:10and that's, I mean, a stock price, a stock picker's market.
00:13And we see that through realized correlation,
00:15one-month correlation in the S&P is at, what, 6%,
00:17so it's rock-bottom levels.
00:19And so you are seeing that ability to find growth
00:23and opportunity outside of the MAG7 complex
00:27and the AI complex as well.
00:29But that's also on a geographical basis as well.
00:31We've seen big outperformance for a while now
00:33from Europe and Japan and Cosby and those factors as well.
00:36But, yeah, the S&P at the moment is trading a range, 7,600, 6,800.
00:40And, yeah, we expect it to probably continue to trade that range
00:43in the short term at an index level with pockets of opportunity
00:46at a stock level with increased diversification
00:49and opportunity coming through from that earnings breadth playing through.
00:52So, yeah, I think a range in the short term,
00:54but within under the hood, correlations are very low.
00:58And, you know, you are seeing some decent moves
01:00and some decent opportunities playing through.
01:04And what are the decent opportunities that you're seeing in particular?
01:09Well, it depends on your time frame.
01:10I think short term, obviously, we're very much focused on the energy trade
01:13given that the unfolding situations that are taking place in Iran
01:17and the mobilization of troops over to that situation.
01:21I think the market, obviously, got very wrong-footed on that situation,
01:24thinking that some sort of deal was going to come through.
01:26And, obviously, the news flow has changed quite radically overnight.
01:28And, obviously, we're seeing potential for some outperformance coming from energy.
01:33I still like, from a bigger picture situation, I still think the US underperforms.
01:37I think we're still going to see European equity markets,
01:40which are mostly trading at all-time highs at an index level,
01:43continue to outperform.
01:44I think Japan outperforms.
01:45Even the ASX today, I remember the last time I checked,
01:47we were about two points from an all-time high
01:49because banks are reporting pretty good numbers
01:51and, obviously, material stocks continue to find love
01:54and energy stocks are finding buyers as well as well.
01:56But I think, yeah, obviously, when you come back to the US,
01:58a lot's going to ride on the numbers from NVIDIA next week.
02:01But it's interesting to see, yeah,
02:03there's just probably one of the lowest amount of attentions
02:06we've seen to NVIDIA's results that I remember in many, many quarters,
02:09the implied volatility in the stocks expecting a move up and down 5.3%,
02:14which is one of the lowest implied moves for a long time.
02:16And I think that just speaks to people expecting them to meet earnings,
02:20to meet revenue and margins.
02:22But, you know, what is the catalyst to see them break out?
02:26And I think what you're seeing in NVIDIA trading at 194, 169 range
02:31is very thematic of the overall index,
02:33which is, as I say, trading 7,000 to 6,800 at the moment.
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