Asian Stocks Edge Higher as Tech Recovers, U.S. Economic Uncertainty Caps Gains 
Asian Stocks Slide as AI Valuation Fears and BOJ Uncertainty Weigh on Markets 
South Korea Warns Weak Won Could Push Inflation Higher in 2025 
Chinese Robotaxi Stocks Rally as Tesla Boosts Autonomous Driving Optimism 
Korea Zinc to Build $7.4 Billion Critical Minerals Refinery in Tennessee With U.S. Government Backing 
Singapore Growth Outlook Brightens for 2025 as Economists Flag AI and Geopolitical Risks 
Oil Prices Climb on Venezuela Blockade, Russia Sanctions Fears, and Supply Risks 
Asian Fund Managers Turn More Optimistic on Growth but Curb Equity Return Expectations: BofA Survey 
Trump Orders Blockade of Sanctioned Oil Tankers, Raising Venezuela Tensions and Oil Prices 
Gold and Silver Prices Dip as Markets Await Key U.S. Economic Data 
Bank of Japan Poised for Historic Rate Hike as Inflation Pressures Persist 
Japan Exports to U.S. Rebound in November as Tariff Impact Eases, Boosting BOJ Rate Hike Expectations 
BoE Set to Cut Rates as UK Inflation Slows, but Further Easing Likely Limited 
Silver Prices Hit Record High as Safe-Haven Demand Surges Amid U.S. Economic Uncertainty 
Gold and Silver Surge as Safe Haven Demand Rises on U.S. Economic Uncertainty 
Wall Street Futures Slip as Tech Stocks Struggle Ahead of Key US Economic Data 
S&P 500 Positioning at Three-Year High: Market Risks and Global Trends
Positioning in the S&P 500 has reached a three-year high, according to Citi strategists. This extended positioning contrasts with other global markets, where investor conviction remains comparatively low. Historically, when positioning reaches these levels, the S&P 500 often experiences pullbacks of over 10% within two to three months.
Increased Positioning Risks
While Citi does not advise reducing exposure, they emphasize that heightened positioning could pose risks. In the past, profit-taking followed stretched profit and loss (P&L) situations, leading to market corrections. However, current P&L levels are positive but not overly stretched, meaning less capital is at risk, potentially reducing the likelihood of significant sell-offs.
European Markets Show Mixed Sentiment
In Europe, the overall sentiment remains positive, with Euro Stoxx 50 short positions decreasing. European banks, in particular, continue to attract long positions. In contrast, China's market reactions to recent stimulus measures have slowed, with positioning on the FTSE China A50 now neutral and the Hang Seng turning more net long.
Volatility in Chinese Markets
Citi strategists expect further volatility in Chinese markets as more stimulus measures are anticipated. Recent reductions in loan prime rates (LPRs) are likely to impact market positioning, with investors closely monitoring fiscal policy announcements expected later this year.
Asian Markets Remain Neutral
Meanwhile, no significant changes have been observed in the Nikkei and KOSPI 200, both remaining neutral. The S&P/ASX 200 has surged nearly 10% since August, driven by new long positions added last week.
