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The global stocks rally takes a breather even as China and Goldman Sachs score big beats

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This is the web version of the Bull Sheet, Fortune’s no-BS daily newsletter on the markets. Sign up to receive it in your inbox here.

Good morning, Bull Sheeters. We’re awash in red this morning. From Shanghai to the U.S. futures, shares are down. That’s despite impressive data out of China today and Goldman’s big earnings beat yesterday.

Let’s check in on the action.

Markets update

Asia

  • The major Asia indexes are down in afternoon trade with the Shanghai Composite off 4.5%. SHCOMP has slumped nearly 7% in the past five days.
  • Chinese stocks are sinking even as China’s GDP grew 3.2% last quarter, defying a global downturn. Exports of laptops and medical equipment was particularly strong.
  • There’s a big exception to today’s slump: China’s biggest chipmaker, Semiconductor Manufacturing International Corporation, made its market debut on Thursday and shares promptly soared 245%. It was the country’s biggest IPO in a decade.

Europe

  • The European bourses fell at the start with the benchmark Stoxx Europe 600 down 0.6%.
  • The ECB meets today, but don’t expect any fireworks from central bank president Christine Lagarde. No change is expected in the emergency bond-buying program even as the economy remains sluggish.
  • The big brewers are having a bad pandemic. Heineken shares are down 4% after the Dutch brewer reported dismal first-half results. Sales sank 53% as the impact of shuttered bars, restaurants and pubs continues to soak the business.

U.S.

  • U.S. futures point to a weak open. On Wednesday, the major averages finished higher—including the Dow, up for a fourth-straight day—boosted by Goldman Sachs‘ knockout earnings and the Moderna vaccine trial news.
  • Twitter shares were down more than 3% in pre-market trading after the social media platform suffered a massive hack attack.
  • It’s another packed earnings day. Among the big names reporting is stay-at-home darling Netflix. The streaming service is forecasting another big jump in subs. Here’s how big.

Elsewhere

  • Gold is down.
  • The dollar is up.
  • Crude is down ahead of an OPEC committee meeting in which producers are expected to open the taps a bit wider beginning next month.

***

The most crowded trade in history

Gold? Corporate bonds? Nope, it’s tech stocks. Some 74% of fund managers said U.S. tech stocks are the most “crowded trade” out there these days. That’s according to Bank of America’s latest fund manager survey. (I covered part of the findings of that packed report here yesterday.)

In fact, BofA says that as “longs” go, U.S. tech stocks are “the longest long of all-time.” Which is a long way of saying it’s the highest reading in the survey’s history. And it’s not even close (as this BofA graphic shows).

COVID is forcing investors to throw out the crisis-investing rule book. That, during a health crisis, a batch of equities—FANG stocks, mainly, but also stay-at-home wonders like Spotify—are viewed as a safer investment than gold, cash or Treasurys must be making veteran fund managers gasp.

Not surprisingly, the overwhelming majority now think stocks are way too expensive—(nearly) historically so.

The price sensitivity could impact this long-trade in the months to come. Sentiment is extremely cautious, and BofA fund managers report they’ve increasingly moved into cash. Cash holdings are now above the 10-year average.

That is what the pros are saying.

Meanwhile, in Robinhood land, they’re riding out the pandemic by piling into Tesla. The higher the price of TSLA goes, the more they pile in.

I’m sure they’re both right.

***

Have a nice day, everyone. I’ll see you here tomorrow. 

Bernhard Warner
@BernhardWarner
Bernhard.Warner@Fortune.com

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Lyron Foster is a Hawaii based African American Musician, Author, Actor, Blogger, Filmmaker, Philanthropist and Multinational Serial Tech Entrepreneur.

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