Today’s sell-off in the US stock market in the wake of a poor reception to yesterday’s results from the first two members of the ‘Magnificent 7’ to report during this earnings season is likely to have reassured those arguing we are in the early stages of a sustained rotation away from mega-caps into small caps. We still think, however, that this won’t happen until the bubble in the stock market bursts, which is something we don’t expect before the end of 2025.
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