FOMO Fear Of Momentum

30/53. FOMO… Fear of Momentum (II)

Past notes: 29/53. FOMO… Fear of Momentum. 28/53. Barbell over Beta, India. 27/53. Halfway mark, Asia playbook, World Cup last 16.

Key events: Asia Leaders Conference. 31 Aug - 2 Sept, HK. Details. Japan Conference. 30 Nov - 4 Dec, Tokyo. Details.

Global equities closed the week roughly flat, though the headline number masks the underlying volatility.

Markets have largely ignored the ongoing conflict, oil price move, and rate move. They are now jostling for attention at once.

Likewise AI narrative seems to have shifted from hyperscaler $ capex headlines and towards the harder questions namely margins, returns, and ongoing debt issuances. On latter GS estimates $490bn of AI- related supply YTD (40% from hyperscalers), or 1.5x of 2025 full year numbers.

Not to mention tariff headlines are starting to heat up again.

I remain of view that the AI/Tech/momentum positioning is not nearly as clean as we might believe. I continue to see more volatility in 3Q. And happy to pound the table on a 'barbell' approach. Recap in last week's note - click.

I’ll be on block leave the next two weeks. Will leave you with a couple of charts to chew on in the meantime.

Good read: Top of Mind - IPO surge: A red flag for markets?

This year’s volatility has been draining, to say the least.

Despite surging volatility at the stock and factor levels, extremely low implied correlations across SPX stocks add to the argument for owning equity index volatility in coming weeks.