Friday Investment Talk: ESG, Corporate Debt, and Fundamental Weakness

This Friday we follow up on our ESG webinar from Wednesday. ESG ETFs have witnessed explosive growth in terms of AUM and number of listings. ESG outperfomance vis-a-vis SPX and even the NDX is evident lately. Certain institutional investors have pushed this stretched trend recently.

Many market indicators (both fundamental and technical) are very overbought. We highlight many graphs available on our telegram channel. We also expose how current corporate debt issuances and Central Bank intervention have resuscitated many companies to zombie status. Unemployment remains elevated and official economic forecasts are for far slower revival rates than markets seem to be pricing in.

But markets are still bullish, recovering from last Thursday’s sell off. Some overbought conditions on Put/Call Ratio indicators and June’s seasonal weak period could provide a reprise for the bears this week.