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Michael Burry maintains bearish outlook on stock market despite S&P 500 reaching record highs

Investor Michael Burry remains skeptical of the current stock market rally, warning that the S&P 500 could be nearing a major top and potentially face a sharp sell-off similar to the 1987 crash. Despite the index reaching new record highs, Burry maintains his bearish wagers, specifically holding short positions in the iShares Semiconductor ETF (SOXX) and individual chipmakers like Nvidia and Micron. Burry noted that the recent 5% surge over four days is a rare occurrence, having happened only three times previously, including during the dot-com bubble. He argued that while new money will likely enter the market due to falling volatility, the underlying momentum in the semiconductor sector remains a key indicator to watch. He also highlighted that the market's advance is creating a self-reinforcing cycle where volatility-targeting funds are forced to leverage up. In addition to his equity bets, Burry is currently working on the fourth installment of his 'Heretic's Guide,' a forensic analysis of the five largest hyperscalers.

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