VTI - SPY: Don't Buy The Dip Just Yet
2024-05-03 09:57:29 ET
Summary
- I believe that the growing discrepancy between interest rates and the upward trend of SPDR® S&P 500 ETF Trust poses a significant threat that shouldn't be ignored.
- Based on the economy's strength, I remain skeptical about a rate cut and see a low probability of a cut this year (unlike the consensus says).
- Even if the 10-year yield were to fall to 4.25%, historical analysis still suggests modest downside potential for S&P 500's valuation multiples.
- I maintain my "Hold" rating on the S&P 500 Index and advocate stock selection that favors high-quality names with already stable FCF or clearer growth prospects.
Throughout my coverage of the SPDR® S&P 500 ETF Trust ( SPY , SP500 ) I consistently emphasized that my primary responsibility as an analyst was to continually give my readers fresh food for thought, avoiding direct attempts to time the market. Unlike individual companies within the ETF, which are subject to various idiosyncratic factors, SPY itself is influenced by a wide range of data inputs - therefore, it's not only feasible but essential, in my opinion, to ensure more frequent updates....
SPY: Don't Buy The Dip Just Yet