DC Lite #543

1. Layoff talk. “One BIG positive economic read from Q1 earnings calls is the lack of layoff mentions.”

2. Short interest. “At 2.7%, short interest for the median S&P 500 stock is on the high side, but the buildup appears tied to portfolio hedging, not a wave of bearish bets”.

3. Crowding. “The long trash trade is getting very, very crowded.”

4. SPX breadth. “52-wk average of market breadth* as of Friday had rebounded to its best levels since 2023. *Market breadth calculated as the difference between the distance of the aggregate S&P 500 Index from its 52-week high and the distance of the median S&P 500 constituent from its 52-week high.”

5. AI vs. SPX. Since the launch of ChatGPT in Nov’22, the weight of “AI companies” in the S&P 500 has grown from ~25% to ~45%.

ICYMI