InterMarket Analysis Update for Monday April 14, 2025

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Link to The SPX Investing Program https://spxinvesting.substack.com/

The Intermarket Analysis Update for April 14, 2025, examines market trends beyond the S&P 500 to gain insights into stock performance during a volatile week. Key points include:
1. Valuation: The S&P 500 remains overvalued on an historical basis with a PE ratio above 20, despite declining from recent highs. The Shiller PE ratio is at 33, far above the median/mean of 16-17. Forward-looking PE ratios show the S&P 500 at 19.3, mega caps at 23.7, while small and mid-caps are fairly valued at 13-13.7.
2. Growth vs. Value: Growth is weakening relative to value, with value outperforming, signaling a defensive market posture. Growth-to-value ratios are nearing critical levels, with potential "death crosses" indicating further weakness, though uptrends persist in some ratios.
3. Inflation: Inflation appears to be under control, for now, with the CRB commodity index declining and inflation expectations dropping since early 2025. However, fears of future inflation linger. Commodities such as corn and copper show mixed trends, while oil and aluminum are in downtrends.
4. Other Markets: Gold hit an all-time high, reflecting market uncertainty, while silver lags but remains in an uptrend. The dollar is weakening, with the euro and yen gaining. Copper’s uptrend suggests economic optimism, while the copper-to-gold ratio is declining.
5. Sectors: Defensive sectors such as staples and utilities are outperforming, while tech and semiconductors are weakening, with downtrends forming. The Financials and industrials show resilience but face pressure. Real estate struggles as interest rates rose this week.
6. Indexes and Ratios: Small caps, mid-caps, and the NASDAQ are underperforming the S&P 500. Mega caps show weakness, and correlations between stocks, bonds, and yields are neutral or weakening. The equal-weight S&P is outperforming the cap-weighted version.
7. Bonds: Bonds have been volatile, with prices falling but showing some recovery. High-yield bonds are holding up better than investment-grade bonds. Bond-to-stock ratios show bonds outperforming stocks recently.
8. Long-Term Trends: The NYSE and S&P 500 are dropping below key moving averages, with momentum weakening. Commodities are continuing to outperform stocks.
9. Positive List: copper, gold, silver, staples, bonds, and the Dow.
10. Negative List: mega caps, semiconductors, mid/small/micro caps, The NASDAQ, and Bitcoin, which saw a death cross.
Highlights suggest a cautious market with defensive shifts, overvaluation concerns, and mixed signals across assets, urging vigilance for potential further declines.

PDF of Charts and Slides used in today's video:
https://drive.google.com/file/d/1qFgzLgDycz1qQ8rt4EER_gvvXASXYaDN/view?usp=sharing

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DISCLAIMER This video is for entertainment purposes only. I am not a financial adviser, and you should do your own research and go through your own thought process before investing in a position. Trading is risky!