Detrick: Expect potential turbulence—August often brings surprise events

Market Overview & Outlook - The AI trade is seen as justifying the current market rally and bull market [1] - The market is considered a strong bull market with record earnings and new cycle highs in profit margins [1] - The dual tailwinds of record earnings and new cycle highs in profit margins are supporting the bull market [1] - The industry suggests remaining overweight equities with a diversified portfolio [5] - The industry favors large-cap stocks over small-cap stocks [5] August Historical Trends & Potential Risks - Historically, August has been negative in post-election years under a second-term president, with the last six occurrences being down [2] - August is associated with unexpected turbulence and random events [3][6] - A potential 4% pullback is possible but considered part of the process [6] Investment Opportunities - Cyclical areas within the US market, such as industrials, financials, and technology, are favored [5] - Opportunities exist globally [5]