HSBC strategists said that due to strong performance in the second quarter earnings season and lower valuations, the stock market showed resilience during the Middle East conflict, and they still overmatched this asset class. “This slight correction over the past week and a half was enough to eliminate the selling signals in our mood and position framework,” the team led by Max Kettner wrote in the report; bond yields were already at historically high levels, while stock valuation multiples had been lowered, and investors underestimated the strength of second-quarter earnings.

HSBC strategists said that due to strong performance in the second quarter earnings season and lower valuations, the stock market showed resilience during the Middle East conflict, and they still overmatched this asset class. “This slight correction over the past week and a half was enough to eliminate the selling signals in our mood and position framework,” the team led by Max Kettner wrote in the report; bond yields were already at historically high levels, while stock valuation multiples had been lowered, and investors underestimated the strength of second-quarter earnings.