S&P 500 Near Highs, but Market Breadth Signals Strain
Morgan Stanley’s Mike Wilson points to weakening participation and widespread pullbacks as two signs that market confidence may be fragile.
The S&P 500 is near record highs, but Yahoo Finance’s Brian Sozzi highlighted two signs of strain beneath the surface. Morgan Stanley strategist Mike Wilson and his team point to falling market breadth and widespread stock pullbacks.
Market breadth measures how many stocks participate in a move. The share of S&P 500 stocks above their 200-day moving average fell to 49%, from roughly 75% over the summer.
Wilson said breadth kept expanding while crude prices and Treasury yields moved higher. The sharper decline came after Jackson Hole, which he said suggests investors are pricing in additional tightening.
A second warning: about 51% of Russell 3000 stocks have fallen at least 20% since June. The article describes that level of decline as technically bear market territory.
The contrast is between the S&P 500’s near-record level and the number of its component stocks holding up.
This article was produced with the help of AI technology.
Source: Yahoo Finance
