Bullish case for stocks intact as earnings outweigh geopolitics: HSBC

• Equities were slower than historical averages (5.5-6 weeks vs. 1 month) to recover from recent geopolitical events.
• Market focus is on earnings, especially tech and AI, which account for almost 50% of S&P market cap, with tech earnings up over 3% in March.
• Investor positioning is 'so light,' indicating mechanical selling pressure has flipped to mechanical buying.
• Current market conditions are not comparable to the dot-com bubble due to stronger free cash flow and more reasonable tech valuations.

HSBC's Max Kettner notes that while equities took longer than usual to recover from recent geopolitical events, the market's focus has shifted to strong earnings, particularly in tech and AI. He highlights light investor positioning and robust tech fundamentals, suggesting further upside as markets look past geopolitical risks and valuations remain reasonable compared to past bubbles.