TechFlow, August 29 — According to Jinshi Data, analysts say investors who are already concerned that the U.S. stock market bull run has reached unsustainable levels will soon face fresh worries.
Next week, the calendar turns to September, historically the weakest month for U.S. equities. Investors will also receive the latest nonfarm payrolls and two inflation reports before the Federal Reserve delivers its closely watched policy decision. Meanwhile, Trump continues attacking the Fed's independence and calling for aggressive rate cuts.
Given that the S&P 500 has risen 17% since early May, bulls enter September in a particularly vulnerable position. Current valuations stand at 22 times expected earnings—levels comparable to the end of the dot-com bubble.
According to Barclays strategists, programmatic traders who rely on momentum rather than fundamentals hold near-record long positions in U.S. stocks, while hedge fund equity exposure is already crowded. Bank of America analyst Paul Ciana notes that since 1927, the S&P 500 has declined in September with a 56% probability, averaging a 1.17% drop. In the first year of a presidential term, the likelihood of a September decline rises to 58%, with an average fall of 1.62%.
