Bank of America strategist Michael Hartnett said global stock markets risk overheating. The bank's so-called "global breadth rule" shows that about 71% of stock indexes are above the 50-day and 200-day moving averages.

Hartnett pointed out that the index above 88% would trigger a reverse sell signal. The strategist has been more neutral on stocks this year.highlimitvideopoker2021He was generally bearish in 2023, despite a rise in the S & P 500 at the timehighlimitvideopoker202124%.

After stumbling in April, the MSCI World Index hit another record high in May on optimism that the Federal Reserve will start cutting interest rates later this year.

Data shows that about 68% of the index's components are trading above the 200-day moving average. This round of gains is not limited to U.S. technology giants.

But the index fell back this week as strong economic data raised new doubts about the prospects for monetary easing. The global benchmark index is on track to fall in a single week for the first time in five weeks.

Barclays said the stock market rally was beginning to "look a little sluggish." As corporate earnings season ends, tight positions and seasonal trends could stall stocks, the bank wrote in a report.

At the same time, Bank of America's report cited EPFR Global data showing that all major asset classes recorded inflows in the week ended May 22. Global equity funds increased by $10.5 billion and bond funds increased by $12.5 billion.