Stock market bulls should show a little more caution, given how past oil price shocks have impacted the economy.

Every US recession, excluding the COVID-19 pandemic, was preceded by an oil price shock, BCA Research chief global strategist Peter Berezin said in a new note (see chart below).

“The current macro environment is a toxic brew of many of the same vulnerabilities that haunted the global economy in the lead-up to past recessions: Rising oil prices, an unsustainable tech capex boom, elevated equity valuations, excessively high homes prices, and brewing stresses in private credit and other parts of the financial system,” Berezin wrote.

He added, “Stocks look increasingly oversold in the very near term but will still finish…