Consumer: The Inverse

Goldman Sachs notes a strong inverse correlation between Semiconductors and Consumer Discretionary sectors, as investors rotate out of consumer names to fund near-record high Technology allocations.

Key Takeaways

• 1.Consumer Discretionary stocks are currently trading as an inverse to Semiconductor stocks, with a sharp reversal observed at 1PM on the previous trading day.
• 2.Information Technology allocations in US Prime Brokerage accounts are at extreme highs, reaching the 100th percentile for gross and 99th for net allocations.
• 3.While recent weak earnings from consumer names (MCD, PLNT, SHAK) have raised concerns, the Consumer Discretionary group has been under pressure for two months prior to these specific prints.

Table of Contents

• Consumer Fade & Importantly, When?
• So, What Does it Mean?
• Yesterday: Semis vs Consumer From 1PM Onwards...
• Notice to Australian Investors
• Additional Disclaimers

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