by SIACharts.com
Global equity markets are contending with growing uncertainty, driven by a volatile mix of shifting investor sentiment and ongoing trade policy disruptions. Since March, the United States has rolled out a series of aggressive tariffs targeting key trading partners, prompting retaliatory measures from countries such as Canada, the European Union, China, and others. These trade actions have disrupted supply chains, complicated investment planning, and left multinational firms operating in a more fragmented global landscape. While negotiations with several countries are underway, progress has been slow and uneven. Markets are grappling with a lack of clarity, as the current U.S. administration continues to move quickly and often unpredictably on trade policy.
This unpredictability was on full display yesterday, when copper prices pulled back sharply despite what had appeared to be improving macro signals. It was a reminder that markets are sensitive not just to fundamentals but also to political risk and policy tone. With President Trump frequently introducing surprise announcements or policy shifts, investors are being forced to reassess their positioning more frequently and with greater caution. In this kind of environment, traditional trend-following tools can struggle to provide timely signals. This is where Bullish Percent Indexes (BPIs) can offer value. By focusing on market breadth through objective, rules-based signals, BPIs help filter the noise and reveal whether strength or weakness is broadly supported, providing a more stable compass when the macro landscape is in flux.
Decoding Market Breadth Through Bullish Percent Indexes
Bullish Percent Indexes (BPIs) are a valuable tool for understanding the overall health of a market or group of stocks. Based on Point & Figure charting, BPIs show the percentage of stocks in a group such as the S&P 500 or a specific sector that are currently on buy signals. Instead of focusing on price movement or short-term noise, BPIs measure how many stocks are showing clear signs of strength. This makes them especially useful for spotting shifts in market trends.
When a BPI is rising, it means more stocks are moving to buy signals, indicating growing participation in the rally. When it is falling, fewer stocks are holding up, which can be an early warning sign of weakness. In this report, tracking these indexes helps reveal whether strength in the market is broad and healthy or concentrated, in just a few names.
Currently, the BPI has reversed into Os, indicating a shift toward supply and a potential deterioration in market breadth. The reading now stands at 64%, a still-elevated level that has just pulled back from the overbought red zone, typically defined as 70% and above. This suggests that while many stocks are still on buy signals, enough have rolled over to signal rising risk and a need for greater selectivity in positioning.
Diverging Paths: A Deep Dive into Country ETF Performances
Several ETFs show notable divergence between short-term and year-to-date trends. Poland (EPOL), for instance, has the strongest YTD performance at 57.04% yet saw a sharp weekly decline of 3.71%, suggesting a pullback after significant gains. Similarly, Spain (EWP) is up 45.53% year-to-date but fell 1.48% over the past week, and Italy (EWI) has gained 38.99% YTD despite a 1.42% weekly drop. All three suggest a cooling of momentum. Argentina (ARGT) shows the opposite pattern. While YTD performance is modest at 1.40%, it was the strongest performer last week at 2.11%, suggesting a potential recovery from prior weakness. A clear underperformer is Saudi Arabia (FLSA), which is down 8.79% YTD and slipped 0.65% last week, indicating ongoing negative sentiment.
On the consistent end, South Korea (FLKR) shows relative strength with a 43.42% YTD gain and only a mild 0.52% weekly decline, maintaining its uptrend. Germany (FLGR) posted a 31.20% YTD gain, though it dropped 4.03% last week. South Africa (EZA) followed a similar path, up 30.35% YTD but falling 4.05% weekly, suggesting temporary pullbacks within a broader positive trend. Conversely, countries like Turkey (TUR) and Thailand (THD) have struggled consistently. Turkey is down 4.69% YTD and 0.59% weekly, while Thailand has returned 3.66% YTD and 0.26% weekly. Indonesia (EIDO) follows a similar pattern with a 2.33% YTD loss and a 1.29% weekly drop, reflecting persistent underperformance across both timeframes.
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