S&P 500

European stocks declined for first session in five ahead of Wednesday's Dutch elections, debt ceiling expiration and the conclusion of the Fed's 2-day meeting where it is expected to raise rates by 25 bps. Tightening concerns emerged, also dragging down Asian shares and S&P futures, while the dollar continued its rise for a second day. Crude oil has ended its six-day drop. The pound tumbled 0.8% to the lowest since mid-January in a delayed reaction after Theresa May won permission to trigger the country’s departure from the EU.

Complacency about U.S. stocks has become so widespread that losses may lie ahead, according to Brian Belski, chief investment strategist at BMO Capital Markets. In a report Friday, Belski cited the ratio of the S&P 500 Index’s price-earnings ratio to the VIX Index, "which essentially shows how much investors are willing 'to pay' for a given level of market risk."

As Bloomberg notes, the ratio rose this month to its highest reading since 1994.

Authored by Lance Roberts via RealInvestmentAdvice.com,

Last week, I discussed the “World’s Most Deceptive Chart” which explored the deception of “percentage” versus actual “point” losses which has a much greater effect on both the real, and psychological, damage which occurs during a bear market. To wit:

European bourses advance and Asian share rose led by a surge in Hong Kong stocks which rose the most in three months as Japan hit 15 month highs. U.S. futures are little changed along while the dollar rebounded from session lows after Friday's selloff. Crude oil has continued its retreat, down 0.2% and sliding for a 6th straight day after breifly dropping below $48 in overnight trading.

Looking at the most recent CFTC Commitment of Traders report, BofA makes two notable observations ahead of what may be a volatile week between the Fed's 25bps rate hike announcement on Wednesday, just hours after the Dutch General Election, and on the same day as the US debt ceiling expiration hits.