Focus flagged late-stage equity exuberance in Q2 2026, citing AI-driven valuations it views as inconsistent with sustainable returns.
The S&P 500 rebounded about 17% after a 9% March selloff; the TSX Composite rose about 7% on banks and commodities.
The report said about half of S&P 500 market cap trades near 10x price-to-sales, raising payback risk even with strong earnings.
US growth was described as increasingly dependent on AI capital spending, with up to three-quarters of Q1 2026 growth tied to it.
Strategy tilt: selective equities outside AI, more caution in credit with tight spreads, higher-quality shorter-duration bonds, and a larger role for alternatives.
SPY•
