Signals to watch for a market peak
A living tracker for the BofA "signpost" framework — sentiment, valuation and macro signals that historically cluster near major market tops — extended with the recession, credit, financial-conditions and valuation gauges that top investment firms watch. The publicly available signals (led by the inverted yield curve) are tracked live from FRED so you can watch them evolve over time.
AI infrastructure stress tracker · Credit + GPU supply
Data pendingFor free, this can be tracked pretty well with one limitation: actual AI data-center private-credit/project-finance spreads are not fully observable for free in real time. The practical setup is triangulation: live FRED credit OAS, issuer-level FINRA TRACE bond checks, credit ETF proxies and GPU rental prices from public marketplaces.
FRED OAS series are daily at the source but shown here as monthly averages to keep the public endpoint reliable, so the ~60-day flags are approximate. Issuer spreads require manual TRACE bond lookup and maturity-matched Treasury subtraction.
AI data-center financing basket
| Issuer | Why track it | What to record |
|---|---|---|
| Oracle / ORCL | Most direct public bond proxy for debt-funded AI cloud and data-center stress. | Track liquid 5Y and 10Y TRACE bonds; compare spread vs its 20d/60d average. |
| Digital Realty / DLR | Data-center landlord / REIT credit proxy. | Watch issuer spread widening vs REIT peers and the BBB OAS index. |
| Equinix / EQIX | Higher-quality data-center REIT proxy. | Use as the cleaner data-center credit benchmark against weaker issuers. |
| CoreWeave / CRWV bonds | Neocloud / AI infrastructure credit proxy, if available in TRACE. | Prioritize newest benchmark issues and any weak new-issue concessions. |
| Nebius / NBIS debt | Neocloud proxy, if public debt becomes observable. | Treat availability as intermittent; use equity and funding news as context. |
| Data-center-linked utilities | Secondary signal for power-grid financing pressure. | Watch spreads and new issuance where data-center load growth is explicit. |
Mega-cap buyer basket
| Issuer | Why track it | What to compare |
|---|---|---|
| Microsoft / MSFT | AI cloud buyer and OpenAI-linked capacity demand. | Compare matched-maturity spread to ORCL/DLR/EQIX basket. |
| Amazon / AMZN | AWS AI infrastructure buyer. | Stable AA/AAA-tier spreads are the control group for AI demand. |
| Alphabet / GOOGL | Google Cloud, TPU and AI infrastructure buyer. | Watch whether top-tier buyer spreads stay calm while weaker borrowers widen. |
| Meta / META | AI capex funded by advertising cash flow. | Useful buyer-spread comparison even when exact bond liquidity varies. |
GPU rental-price dashboard
| Metric | Track | Warning threshold |
|---|---|---|
| H100 SXM 80GB | P10 / median / P90 hourly price plus available count. | Yellow: median price down 15% over 4-8 weeks. Red: down 30%+. |
| H200 | Median price and offer count for memory-heavy training/inference capacity. | Same thresholds as H100, with extra weight on availability rising. |
| B200 / B300 | P10 / median / P90 hourly price and available offers. | Red if newest-gen pricing falls 25-30% while credit spreads widen. |
| A100 80GB | Median hourly price. | Older-generation oversupply signal when price falls without demand rotation. |
| Availability | Number of offers and available GPUs for H100/B200 class supply. | Yellow: +30-50% with falling prices. Red: +75-100% with falling prices. |
| Spot discount | Spot or interruptible price vs on-demand price. | Yellow above 50%; red above 70%. |
| Hyperscaler premium | AWS/Azure/GCP posted price divided by neocloud median. | Compression means price pressure is moving up-market. |
| B200 premium to H100 | B200 hourly price divided by H100 hourly price. | Fast shrinkage says newest capacity is becoming commodity supply. |
Combined interpretation matrix
| Credit spreads | GPU rental prices | Meaning |
|---|---|---|
| Stable | Rising | Bullish AI demand / supply shortage. |
| Stable | Falling | Better GPU supply; not necessarily a bubble crack. |
| Widening | Rising | Demand still strong, but financing risk is rising. |
| Widening | Falling | Most dangerous: overcapacity plus higher funding cost. |
Hyperscaler IG credit spreads · Macro
Spreads containedICE BofA option-adjusted spreads (OAS) for investment-grade corporates, split by rating. The mega-cap hyperscalers split across the credit stack: Microsoft, Alphabet and Amazon sit in the AAA/AA bucket, while Oracle is the BBB exception. Watching the BBB OAS widen relative to the A/AA series captures the lower-rated-hyperscaler stress directly, at the sector level. Spreads are quoted in percentage points over the Treasury curve — wider = more compensation demanded for credit risk.
Index-level series are free and daily from FRED (ICE BofA OAS). For true issuer-level spreads (individual Microsoft / Oracle / Meta / Alphabet / Amazon bonds) look up the CUSIPs on FINRA TRACE and subtract the matched-maturity Treasury — these index aggregates are market-cap weighted and not single issuers. LQD is a quick-and-dirty IG proxy but won't isolate the hyperscalers.
How to read this curve — in plain English
Each line shows the extra interest, in percentage points, that companies of a given credit quality must pay to borrow compared with the ultra-safe U.S. government. Think of it as the market's "fear gauge" for corporate debt. When lenders feel safe they ask for very little extra; when they get nervous they demand a lot more. So:
- Low and flat lines = calm, confident markets. Lenders aren't worried about getting paid back. This is normal in a healthy or booming market.
- Lines rising = fear creeping in. Investors are demanding more to take credit risk — the early smoke before the fire.
- Lines spiking sharply = stress / panic. This is what happens going into a recession or bear market (it happened in 2008 and in early 2020).
The key trick — watch the gap, not just the level. The safest tech giants (Microsoft, Alphabet, Amazon) sit on the top lines (AAA/AA). The more indebted name (Oracle) sits on the bottom BBB line. The "BBB − A" chart above measures how far apart those two groups are pulling. When the weaker borrowers start paying a lot more than the strong ones, the market is quietly flagging trouble in the riskier corner of Big Tech first.
Using it to spot a possible bear market
- Direction beats level. A spread that is rising steadily, week after week, matters more than whether today's number is "high" or "low". The turn is the warning.
- Watch the gap widen. If the BBB − A line climbs above roughly 0.5 ppt (the dashed "watch" line) while the top-rated lines stay calm, money is fleeing the riskier borrowers — a classic early crack.
- Look for everything flashing at once. Credit spreads rarely call a top alone. The strongest bear-market warning is when these spreads widen and the other signals on this page light up together — the inverted yield curve, the Sahm recession rule, tightening bank lending. One signal is noise; several at once is a signal.
- Spreads lead, not lag. Credit markets usually sense trouble before the stock market does, so a sustained widening here is an early heads-up, often months ahead of a downturn.
Bottom line: calm, low lines = skies clear. Rising lines and a widening BBB − A gap = storm clouds gathering — tighten your risk. This is a weather forecast, not a guarantee — for education, not investment advice.
Inverted yield curve · Macro
Not invertedThe yield curve is "inverted" when long-term rates fall below short-term rates — the spread drops below zero (the dashed line). Inversions have preceded every U.S. recession since the 1970s. Below 0 = inverted.
Recession & growth
Credit & financial conditions
Valuation & inflation
Volatility & sentiment
How the signals cluster at peaks
Share of the 10 BofA signposts triggered at each prior market peak versus the last three months. A high reading means many signals are flashing at once — the average prior peak saw roughly 70% triggered.
Indigo bars = last three months (Mar–May 2026); grey bars = prior market peaks. Values from BofA Exhibit 11.
The 10 BofA signposts
| Signpost | Category | Trigger condition | Data |
|---|---|---|---|
| Conf. Board Consumer Confidence > 110 (prior 6m) | Sentiment | Index level above 110 in the prior 6 months | Proprietary The Conference Board (proprietary). Proxy chart below: U. Michigan sentiment. |
| Conf. Board: Net % Expecting Stocks Higher > 20 (prior 6m) | Sentiment | Net % expecting higher stock prices above 20 | Proprietary The Conference Board (proprietary). |
| Sell Side Indicator: "Sell" signal triggered (prior 6m) | Sentiment | BofA Sell Side Indicator reaches a "Sell" reading | Proprietary BofA US Equity & Quant Strategy (proprietary). |
| S&P 500 LT growth expectations (LTG): 5yr Z-score > 1 | Sentiment | Long-term growth expectations 5yr Z-score above 1 | Proprietary IBES / BofA (proprietary). |
| 10yr Z-score of # of M&A deals (3m sum) > 1 (prior 6m) | Sentiment | Rolling M&A deal count 10yr Z-score above 1 | Proprietary BofA / deal databases (proprietary). |
| 10yr Z-score of (trailing S&P 500 PE + YoY CPI) > 1 | Valuation | "Rule of 20" style Z-score above 1 | Partly live CPI YoY tracked live (FRED); trailing PE component proprietary. |
| Low PE underperforms High PE by 2.5ppt over last 6m | Valuation | Value (low PE) trails growth (high PE) by ≥ 2.5ppt | Proprietary BofA quant factor returns (proprietary). |
| Inverted yield curve (prior 6m) ● Not inverted now | Macro | 10Y–2Y or 10Y–3M Treasury spread falls below 0 | Live · FRED FRED: T10Y2Y, T10Y3M. |
| Credit Stress Indicator drops below 0.25 (prior 6m) | Macro | BofA Credit Stress Indicator below 0.25 | Proprietary BofA Credit Strategy (proprietary). |
| Tightening credit conditions (SLOOS) ● Net easing now | Macro | Net % of banks tightening C&I standards turns positive | Live · FRED FRED: DRTSCILM (Fed Senior Loan Officer Survey). |
Additional signals top firms watch
Beyond the BofA list — recession, credit, financial-conditions and valuation gauges widely used across the Street, each tracked live above from a free public source.
| Signal | What it flags | Who watches it | Now |
|---|---|---|---|
| Sahm Rule recession indicator | Triggers when the 3m-avg unemployment rate rises ≥ 0.50ppt above its prior-12m low — has flagged every recession since 1950. | Federal Reserve economists, Claudia Sahm; cited across sell-side macro desks. | — |
| Credit spreads (Baa over 10Y Treasury) | Compensation demanded to hold risky corporate debt. Tight spreads = complacency near peaks; spreads blow out into stress. | Oaktree (Howard Marks), PIMCO, DoubleLine and every credit desk. | — |
| Financial Conditions Index (Chicago Fed NFCI) | Broad gauge of money, credit and risk in markets. Above 0 = tighter-than-average conditions — a headwind for risk assets. | Goldman Sachs (own FCI), the Fed, and macro allocators. | — |
| VIX (equity volatility) | Options-implied 30-day S&P 500 volatility. Very low VIX often marks complacency near tops; spikes mark stress. | Volatility desks, risk-parity funds, tactical allocators. | — |
| Buffett Indicator (market cap ÷ GDP) | Total US equity value relative to the economy — Buffett’s "best single measure" of valuation. Extreme readings = rich market. | Warren Buffett / Berkshire; widely tracked valuation gauge. | — |
Sources
- BofA Global Research — "Exhibit 11: List of signals to watch for a market peak"BofA US Equity & Quant Strategy. A "bear market" is typically defined as a 20% drop in the S&P 500; 1990, 2018 and 2025 (19%+ drops) are included to enlarge the sample. See the report appendix for per-signal methodology.
- ICE Data Indices via FRED, daily (shown as monthly average). Series: BAMLC0A0CM (Master), BAMLC0A1CAAA (AAA), BAMLC0A2CAA (AA), BAMLC0A3CA (A), BAMLC0A4CBBB (BBB). Option-adjusted spreads to the Treasury curve; index aggregates, not single issuers. For issuer-level spreads use FINRA TRACE bond data.
- ICE Data Indices via FRED, daily (shown as monthly average). Broad high-yield credit stress gauge.
- Free issuer-level corporate bond trade lookup. Use liquid benchmark bonds and subtract matched-maturity Treasury yields to estimate issuer spreads.
- Daily Treasury curve used to estimate maturity-matched risk-free yields for issuer-bond spread calculations.
- Live GPU marketplace pricing and API/CLI-queryable offer data for H100/B200-style rental tracking.
- Free comparison dashboard for cloud GPU offers across providers.
- Public neocloud GPU pricing benchmark for H100/H200/B200-class instances.
- Public hyperscaler posted-price references for GPU compute pricing.
- Federal Reserve Bank of St. Louis (FRED).
- Federal Reserve Bank of St. Louis (FRED).
- Moody’s / FRED — credit-risk gauge.
- Federal Reserve Bank of Chicago via FRED, weekly.
- Federal Reserve Bank of St. Louis via FRED, monthly.
- Cboe via FRED, daily (shown as monthly average).
- Federal Reserve / BEA via FRED, quarterly. Market value of corporate equities as a % of GDP.
- Fed Senior Loan Officer Opinion Survey via FRED, quarterly.
- University of Michigan via FRED, monthly. Public proxy for consumer confidence.
- U.S. Bureau of Labor Statistics via FRED, monthly.
For informational and educational purposes only — not investment advice. The signpost framework is attributed to BofA Global Research; additional indicators are widely used across the industry. Finance Halo independently tracks the publicly available components via FRED and does not reproduce any firm's proprietary indicators.