Naughty Flicks

Skip NavigationMarketsBusinessInvestingTechPolitics & PolicyVideoWatchlistInvesting ClubPROLivestreamMenuStocks have gone too long without a proper shakeup, worries Bank of America. Strategist Savita Subramanian pointed out that the S & P 500 has only suffered one 5% pullback in 2026. Usually, three take place every year, she said. On top of that, a correction — a 10% move down from a 52-week high — hasn’t happened since the spring of 2025, during the tariff tantrum. “Pullbacks are normal,” wrote Subramanian. “In our view [we] are overdue for a pullback.” “Near-term seasonality is also weak,” she added, noting that the S & P 500 averages a 0.6% decline in the September-October period, based on data going back to 1928. That’s the weakest average performance of any two-month period for the stock market benchmark. .SPX YTD mountain S & P 500 year to date That seasonality is already starting to show up. The major averages are coming off a losing week and are down in September. Stocks were also headed for a lower open Monday, as worries around the safety of artificial intelligence pressured chip names and other parts of the AI trade. On top of that, Treasury yields remain near multiyear highs, with recent inflation data raising expectations that the Federal Reserve will hike interest rates this week. To be sure, Subramanian noted the long-term bull market “is intact,” adding: “The consumer is okay, as are jobs.” However, she doesn’t see much near-term upside. Subramanian set a 12-month S & P 500 target of 7,800, which implies further appreciation of less than 2% from Friday’s close. The strategist also hiked her year-end 2026 S & P 500 forecast to 7,400 from 7,100. That signals a decline of 3.4% ahead. “50% of our bear market signposts are triggered – not as bad as 70% seen in May-June, but still elevated,” Subramanian said.Read More