Is the Nasdaq preparing to correct?
The Nasdaq 100 index seems to be taking a breather around the 7,000 level, and is testing the 200-day simple moving average. Is the post-January 4 rally showing signs of old age?
Head of Equity Strategy
Summary: Last month was brutal for equities with leading indices suffering big losses. But while a gentle recovery now beckons, major risks are looming on the horizon.
The market clearly went on a hunt for Red October last month with equities down 7.3% having been down by as much as 9.5% on October 29. This makes it the worst month for global equities since May 2012. Risk parity funds also had an ugly October with AQR's risk parity fund down 4.9% as fixed income did not provide shelter for the havoc in equities; the fund is down 6% year-to-date which will end up making 2018 one of the worst asset allocation years since WWII. What can we expect from here? Is this the beginning of a major decline in global equities?