A note Monday from JPMorgan Chief Global Markets Strategist Marko Kolanovic's analyst team.
In summary:
- US stock market is seeing its dependence on a handful of megacap names increase at the fastest pace in 60 years, surpassing what was seen during the dot-com bubble, which peaked in March 2000
- additionally, crowding in growth stocks included in the S&P 500 has reached the 97th percentile on a historical basis, the highest since the dot-com bubble
- a selloff catalyst might include an event such as:
- a deep recession
- a sudden resurgence of inflationary pressures
- "The peak in this concentration episode should coincide with a diminishing interest in [the generative AI/large-language model] theme from investors or as more rationalization is applied post the initial AI frenzy"
