A Seeking Alpha analysis argues the S&P 500 is tracing the same path as the dot-com bubble, pointing to a near-term pullback before a final push higher. The chart anticipates an 8-10% correction by late August and a September peak near 7,800, followed by a multi-year decline toward 4,400 by 2029.
Analyst Eugenio Catone maps the S&P 500's current run onto the dot-com bubble's trajectory, and the comparison points to one more leg up before a multi-year decline. The index closely mirrors that pattern, which suggests a near-term correction followed by a final melt-up.
The chart anticipates an 8-10% correction by late August, then a September peak near 7,800. After that, Catone sees a gradual multi-year decline, with the index sliding toward 4,400 by 2029.
The S&P 500 traded at 7,546.48, up 0.85%, against a 52-week high of 7,620.90 and a 52-week low of 6,201.00.
Behind the parallel sits the AI trade. The analysis says AI sector enthusiasm is peaking, with hyperscaler CapEx overspending and cracks emerging in returns on investment and the pace of technology progress.
Two catalysts could set off the near-term move. Catone points to upcoming Q2 results from US hyperscalers and potential Middle East tensions as events that may trigger a short-term correction before the final AI-driven rally.
Source: Seeking Alpha (snippet-based)
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