In this episode:

• The S&P 500 keeps climbing, up more than 30% in just five months, driven by the AI boom and “mechanical” flows such as buybacks and systematic funds. Oracle shocked markets with a +36% move in a single day, while AI-related companies now account for 40% of the index’s market cap.
• On the macro side, U.S. labor data is showing cracks, with downward payroll revisions and rising unemployment, even as the Fed continues cutting rates.
• In Europe, the picture remains fragile: inflation is proving stickier than expected, France faces political turmoil, and spreads are widening to multi-year highs. Meanwhile, geopolitical tensions are intensifying with Russia, while China, Russia and India are strengthening ties.

More than chasing the rally, the key now is to understand whether market strength rests on solid foundations or on extraordinary factors. The motto still applies: don’t fight AI and the Fed — but caution is warranted in such a one-sided consensus. For more insights, listen to the new episode of the podcast hosted by Alberto Tocchio, Head of Global Equity and Thematics.