An historic surge in US stocks has pushed equities to fresh highs, yet signs of overheating sentiment suggest that the rally may be entering a slower phase.

The rebound from the March lows, fueled in part by hopes of easing tensions between the US and Iran and a surge in corporate earnings, has lifted investor sentiment toward what a quantitative model from Bloomberg Intelligence strategists suggests is “manic” territory. The model tracks six components, and three of them have driven it toward that level: high-yield corporate bond spreads, low volatility, and pairwise correlations.