The S&P 500 (SPX) has witnessed a historic 30% rally from the April lows induced by President Trump’s ‘Liberation Day,’ although slowing demand from buyers threatens the momentum, according to RBC Capital Markets. The firm explains that flows into U.S. equity funds have weakened compared to earlier this year and that demand from American and European investors into U.S.- and non-U.S.-domiciled equity funds has experienced a similar effect.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
“When we zoom out, we think this is evidence of buyers’ fatigue,” wrote RBC head of U.S. Equity Strategy Research Lori Calvasina in a note to clients.
Retail Hesitates amid High Valuations, Seasonality
Calvasina added that the flow of passive investments from retail investors has begun to turn negative. She noted that elevated valuations and September, historically the market’s weakest month, are also risks.
That echoes a warning from JPMorgan Global Head of Market Intelligence Andrew Tyler, who said that the market could face pressure from “potentially stretched positioning” and waning retail investor participation.
Stay ahead of macro events with our up-to-the-minute Economic Calendar — filter by impact, country, and more.