BlockBeats News, June 10th, Barclays Global Stock Tactical Strategy Director Alex Altmann stated in a podcast that he has shifted his view on the U.S. stock market to short-term tactical caution. Alex Altmann insisted on a bullish view against the trend in September last year and called for holding positions even when the Iran conflict broke out in March this year, both of which were eventually validated. However, what triggered his current shift was the accumulation of multiple signals in the past two weeks: the significant rise in financing costs has pushed up real yields, compressing stock valuation multiples; retail investors' enthusiasm levels are sometimes even higher than in 2021, when they were in a deep negative real interest rate environment, whereas now it is a positive real interest rate environment; there is almost no short interest on the institutional side. Alex Altmann pointed out: when enthusiasm reaches such a level, the forward-looking return curve of the S&P 500 no longer looks attractive.

Altmann has particular concerns about leveraged ETFs, as these products, through daily rebalancing, may drive disproportionate stock trading volume through underlying channels, creating a self-reinforcing spiral of ups and downs, a phenomenon that has been playing out continuously in the past few weeks. The resurgence of momentum trading makes crowded positions highly vulnerable to sharp pullbacks triggered by minor position adjustments or narrative shifts. Altmann expects the S&P 500 to experience a cumulative pullback of about 6% to 7%, with the recent decline considered to have completed over half of the process. If a re-entry into a bullish position is desired, he hopes to see further stock price declines to squeeze out the euphoria, for large IPOs to be well absorbed by the market, and for real yields to fall. If the new Fed chairman can verbally suppress real yields and provide reassurance, it will also be a tailwind for the market.