By Peter Callahan, Goldman Tech S&T
Sentiment check: the Nasdaq eked out a small gain last week (+25 bps), breaking a 4 week losing streak that had featured consistent 2-3% weekly sell-offs. While risk sentiment remains stuck in a holding pattern given near-term unknowns - quarter-end / preview season, tariffs on 4/2, NFPs on 4/4 - it was healthy to see signs of ‘stabilization’ as positioning (see GS PB data re: cleaner TMT exposures) & valuations (NDX trading at ~10% discount to 5yr avg P/E multiple) are no longer the headwinds they once were.
That’s the ‘good’ news. The ‘bad’ news is that conviction levels feel very low right now – not because of price or positioning – but because of geopolitical & macro uncertainty (and, in turn, thematic uncertainty), which has translated into a lack of conviction to add to longs in recent days [e.g. last Thursday = lowest volume day of the year].
