Moving with the Crowds

Fund managers are most optimistic about international markets heading into 2026, a shift from the US exceptionalism theme at the start of this year, which ultimately did not materialize. (BofA)

Private credit remains the greatest credit risk for the second consecutive month. Despite some emerging issues, the lack of leverage and mark-to-market risk mitigates the likelihood of a major credit event in my view. Consumer credit is the emerging risk to watch. (BofA)

The Mag 7 continues to be viewed as the most crowded trade, stealing the show from gold after the recent pullback. (BofA)

Almost half of respondents see an AI bubble as the biggest tail risk to markets. (BofA)

Managers are split on whether it is a bubble or not. (BofA)

For the first time, AI capital expenditures are causing concerns about corporate overinvestment. (BofA)

That’s because companies like Meta and Microsoft are spending almost 40% of annual sales on capex. (BofA)

The knife cuts both ways though, managers think the most bullish development for markets would be AI productivity gains. (BofA)

30% of managers believe gold is overvalued, a sentiment not seen in 15 years. (BofA)

Trump is over 250 days in and his approval rating has only fallen. The Republicans can’t afford to lose midterms. (Stifel)

The US government has less room to maneuver than European peers. (BCA)

Since 2020, Arizona has attracted more than 60 semiconductor projects representing over $210 billion in announced investment and roughly 25,000 anticipated new jobs, according to the Arizona Commerce Authority. (Adam Tooze)

As tariffs settle, Canadian companies are learning how to adapt and trade is recovering. (BCA)