Is the bull market running on fumes? Warning signals mount

Warning Signals for the Bull Market

The bull market may be running on fumes, with two key developments sounding warning signals: Jerome Powell's indication of an end to quantitative tightening (QT) and surging U.S. subprime auto loan delinquencies.

Liquidity support may become more targeted, leading to banks tightening lending, and equity valuations could face pressure.

Now is a prudent time for investors to rebalance: rotating profits from high-growth names into defensives, holding some cash for volatility, and perhaps exploring adding uncorrelated assets like private credit or arbitrage funds to their portfolios.

Investors should consider rebalancing their portfolios to mitigate potential risks.

Author's summary: Bull market shows warning signs.

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Roger Montgomery Roger Montgomery — 2025-10-28

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