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● **”Peak Pessimism, Market Bottom?”**

Recent U.S. Stock Market Rebound and Yardeni Research’s Contrarian Investment Indicator Analysis

1. Capturing U.S. Stock Market Rebound Signals

The U.S. stock market is showing signs of rebounding, recently breaking through short-term resistance levels.
The S&P 500 index generated a rare thrust signal, and
the Nasdaq rose by more than 2% for three consecutive days, a first since April 2001.
This upward momentum is interpreted as a signal of strengthened buying sentiment among institutional investors.

2. Minervini’s Investment Perspective

Minervini implies that the S&P 500’s signal indicates proximity to the bottom of the bear market.
Although his model has not yet shown a strong buy signal,
he views this signal as a precursor to a positive shift.
In particular, the surge in demand for data centers, primarily driven by tech stocks, and expectations of an early interest rate cut by the Fed are driving the rise.

3. Yardeni Research’s Contrarian Indicator

Yardeni Research believes that the extreme pessimism expressed in mainstream media may coincide with market reversal points.
With the message “Unite, ye contrarian investors of the world,”
he recalls the boom of the 1920s and predicts the re-emergence of a rolling 2020s scenario (technological innovation, productivity improvement, and a strong regulatory market).
He presents positive signs such as the S&P 500 rising more than 7% from Monday’s low and a decline in the volatility index.

4. Correlation with Consumer Sentiment and Interest Rate Outlook

Yardeni assesses the U.S. consumer sector as remaining strong.
The Capital One CEO’s comments on improved delinquency rates, reduced bad debt expenses, and stable consumer debt ceilings also support this view.
Rising credit card company stock prices and strong performance in the employment and leisure sectors suggest improving consumer sentiment.
However, it is emphasized that these positive trends can only continue if trade agreements are completed.

5. Comparison with Bank of America’s Pessimism

Bank of America cited weakening consumer sentiment, a lack of expectations for interest rate cuts, and incomplete trade agreements as major risk factors.
However, according to the analysis of Yardeni and Minervini,
positive changes that compensate for consumer sentiment and interest rate outlook are already occurring.
In other words, since two of the risk factors have been resolved, the stock market is likely to rise moderately.

6. Comprehensive Investment Strategy and Future Market Outlook

Rather than expanding aggressive buy positions in the current market,
a cautious approach and a strategy of expanding positions after confirming additional breakout stocks are recommended.
Amid the diverse opinions of institutional investors and experts,
it is time to make investment decisions with a long-term perspective and a balanced view.
Changes in the Fed’s interest rate policy, growth momentum centered on tech stocks, recovery of consumer sentiment, etc.
It is necessary to pay attention to key words such as the global economy, stock market, interest rates, consumer sentiment, and tech stocks.

The U.S. stock market recently showed short-term rebound signals in the S&P 500 and Nasdaq,
raising expectations for a positive shift among investors.
Minervini analyzes the index’s signals as a precursor to approaching the bottom,
mentioning the rise of tech stocks and expectations for an early interest rate cut by the Fed.
On the other hand, Yardeni Research suggests that the extreme pessimistic sentiment in mainstream media is rather
an opportunity for market reversal, presenting a rolling 2020s scenario similar to the 1920s.
Strong U.S. consumer sentiment, improved credit indicators, and strong performance in the employment and leisure sectors
serve as the basis for overall market strength, but the completion of trade agreements remains a variable.
Therefore, investors should pay attention to the current positive signals, but
consider a cautious approach and a strategy of expanding positions after confirming additional breakout stocks.

[Related Articles…]
Stock Market Outlook Update
Interest Rate Change Outlook

*YouTube Source: [Maeil Business Newspaper]

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