Citi Strategists Warn of Risk in Overleveraged U.S. Tech Stocks

Citi strategists have raised concerns about the risks associated with excessive bullish positions in U.S. tech stocks. According to Odaily, the team, including David Chave, noted that ongoing enthusiasm for artificial intelligence themes has pushed bullish market bets to their limits, making the Nasdaq 100 index particularly vulnerable to shocks. Concentrated long investments in the index could increase the likelihood of profit-taking and long-term position closures due to any negative factors, heightening market downside risks. Since bottoming out in late March, the S&P 500 index has risen by 20%, while the Nasdaq 100 index has surged by 33%. Momentum indicators show that the Nasdaq 100 index has been in an overbought state for nearly six weeks.