Capital leaving, dollar melting, weak data, interest rates soaring… and the S&P flying.
- – 📈 The S&P 500 rose again strongly
Since the April bottom, the index has risen more than 1,000 points and is up +20%.
Now operating positive for the year (+0.3 %)
Officially, we are in a bull market.
But the pillars of this increase are fragile and the tariff reliefs were fundamental.
- – 🧠 Smart money is running away from this high
Fund allocation fell to 55%, the lowest since 2020.
Individuals are at 64%, the lowest since the 2022 crash.
Little by little, the money is being put into your pocket.
- – 💸 Hedge funds turned short on the dollar
Net exposure went from +35 to -20 in a few months.
It is the second most pessimistic position in the last 2 years.
A sudden movement that precedes cycle transitions.
- – 🌍 Strong currencies have already started to price in this new cycle
In 2025:
•Euro: +9.7%
•Swiss franc: +9.3%
•Yen: +7.9%
•Pound: +6.3%
The DXY index fell -7.5% for the year.
The US dollar is no longer the darling.
- – 📦 Global trade slowing sharply
The new orders PMI fell to 47.5, its lowest level since 2022.
Expectations of future production also collapsed.
The global economy has lost traction — and fast.
- – 💥 Long-term interest rates have exploded in major markets
Germany, UK, Japan and US: all with 30Y breaking resistance
In the USA:
•10Y at 4.50%
•30Y approaching 5%
•+30 bps in May only
The US curve is already 100 bps above the Fed's last pivot.
This movement is not just technical: it is also macro.
The market has been abandoning the thesis of major cuts.
- – 🇯🇵 Japan has become the spark of global stress
•JGB 30Y: 2.96%, highest level since the 2000s
•JGB 40Y: 3.44%, historic record
The country is emerging from artificial interest rate control after decades.
- – 🏦 And this directly affects the US
The BoJ is reducing its balance sheet.
Japanese insurers are selling Treasuries.
Result?
•Less external demand for US debt
•Increased pressure on US long yields
- – 🗣️ Trump has stepped up his attack on the Fed
“Too Late Powell”, “Not fair to America” 🇺🇸
Trump demands immediate cuts.
Powell resists.
And investors… no longer know what to expect.
- – ❌ The market has stopped believing in interest rate cuts
Kalshi now shows only 2 cuts priced for 2025.
There have already been 5.
The curve has turned.
Reality knocked on the door.
- – 🌐 It is a global repricing movement
Yields rose en masse:
•USA
•Germany
•United Kingdom
•Japan
•Canada
It is the global cost of money that is changing.
- – 🎭 The current bull market is more technical than fundamentalist.
High pulled by:
•Tech
•AI
•Short squeeze
But the baseline data continues to deteriorate.
The surface is beautiful. The subsoil, not so much.
This divergence will not last forever!