In an analysis on July 27, Bloomberg macro strategist Simon White noted that U.S. stock markets face the risk of a chain reaction of forced liquidations triggered by high leverage and long positions. Although expectations of a Federal Reserve rate hike continue to exert pressure (interest rate futures indicate a probability of about 30% to 35%), speculators’ net long positions in U.S. stock indices have risen rather than fallen, and the sensitivity of hedge fund positions to S&P 500 returns even hit a five-year high at one point. At the same time, the amount of equity leverage provided by banks to the market is approaching historic peaks. White warned that against a backdrop of tightening liquidity and rising interest rates, a single risk trigger in the market could spark a VaR shock, forcing banks and leveraged funds to rapidly liquidate their risk positions. He viewed SpaceX’s stock price falling below its IPO price as a microcosm of the market’s reassessment of highly valued tech assets.