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The stock market’s bull run is about to take a pause as economic growth continues to slow, according to Andrew Garthwaite, chief global equity strategist at UBS. The widely followed strategist pointed to implied intra-index volatility, which is close to the bottom end of its range, vulnerable for a reversal. Additionally, the Wall Street firm said it believes the U.S. economic data is poised to continue to deteriorate, threatening the market’s bull run. “When it rises, cyclicals have tended to underperform 84% of the time,” Garthwaite said in a note to clients, referring to implied volatility. “We continue to think August will be a down month as US growth slows but the Fed can’t cut until September.” .SPX YTD mountain S & P 500 year to date The S & P 500 has rebounded more than 30% from its April lows, rallying back to record highs and pushing its 2025 gains to 8%. The market’s resilience has come despite higher tariffs and weak data, especially the labor market . “It is notable that 3-month annualized hours worked has weakened sharply and employment PMIs are implying a slowdown in employment growth,” he said. “The team looks for non-farm payrolls to slow to a monthly average of 48K in Q4 and turn negative in Q4 (-12K).” Garthwaite added that while this month is expected to be down, August and September are seasonally the worst months of the year.
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