HSBC Expects 'American Exceptionalism' Trade to Cool in Q3 as Market Reassesses Risks

According to HSBC's Multi-Asset Strategy Team led by Max Kettner, the 'American exceptionalism' trade that has driven global markets this year is expected to cool in the third quarter. The team reiterated its overweight recommendation on equities, noting that market concerns about excessive AI investment, geopolitical risks, further U.S. rate hikes, and overheated risk appetite have been magnified. The team added that risk sentiment and positioning remain neutral overall as the market enters the second half of the year.
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