The S&P 500 Is Near Record Highs: But Most Stocks Are Already in a Bear Market

The analysts at the Kobeissi Letter argued that Wall Street is in a rare “bull-bear market,” with key indices, such as the S&P 500, hovering near record highs even as most of its components trade well below their peaks. The KL’s analysis believes this divergence could eventually fuel another powerful rally if inflation, energy prices, and interest-rate pressures ease. The Contradiction The apparent discrepancy comes after a dramatic deterioration in the macro backdrop. At the start of the year, markets expected at least three Fed rate cuts. Instead, the central bank hiked rates in September, and current expectations imply another three increases by June 2027. This translates to a 175-basis-point swing in the expected policy path.

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