The consequence was a sharp drop in oil prices, but also weakening of copper.
The 10Y Interest rates are now back to 3.65%
As a consequence, much money has moved back into defensive sectors (XLU, XLRE, etc.)
More interesting, corporate bond yields comparatively were much weaker. This indicates a value readjustment into yield providing instruments.
The immediate consequence is that now the S&P500 are not overvalued anymore in terms of yield comparison.
The overvaluation level now stands at $4100. Hence there is some upside here.
On the other hand, money is now moving back into the NQ8 sector and we can see that the Nasdaq Futures seem to be weakening here.
Conclusions:
I would not say that the S&P500 is out of the woods here, but it is clearly not overvalued anymore.
