All gatherings generally have a favorable outcome, with the exception of the final assembly.
In the past few months, the stock market today has been on a remarkable rally. The S&P 500, in particular, has gained over 30% since April 8, marking its strongest gain since the post-pandemic recovery in 2020 and the third such gain in 20 years. This surge in market value is estimated to be worth a staggering $16.6 trillion USD.
The rally has been largely driven by a concentration in the S&P 500, with the 'Big Seven' - Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia, and Tesla - now making up 39% of the index. A significant portion of this concentration stems from a massive bet on artificial intelligence.
However, this bullish trend has raised concerns among investors. The current valuations assume continued profit growth for the companies in question. Any deviation from this trajectory could potentially lead to corrective action in the stock market today.
Recent market corrections have shown how brutally investors punish even the slightest disappointment. For instance, to beat the S&P 500 index in this trajectory, one would need to allocate over 40% of their portfolio to just these stocks. This level of concentration could be risky, as it leaves little room for diversification.
Moreover, the dominance of U.S. tech giants in the S&P 500 could be challenged. A slowdown or the emergence of competitors like Chinese firm DeepSeek could bring a cold shower to the prevailing narrative.
The U.S. labour market has also shown signs of instability. The U.S. Bureau of Labor Statistics revised down job numbers by 911,000 for the year ending in March 2025. Additionally, new unemployment claims in the U.S. reached 263,000 at the start of September, their highest level since October 2021.
Despite these concerns, the S&P 500 rally continues to captivate the attention of investors worldwide. However, it is crucial for investors to approach this market with caution and consider the potential risks involved.
Unfortunately, the identity of the author of the article discussing the current stock market situation in the magazine Le Devoir remains unknown, as their name was not found in the provided search results. Regardless, their insights into the market's current state have certainly sparked important discussions among investors.
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