Major U.S. market indexes may seem to paint the picture that year to date, it's been steady and comfortable—at least when you look at the fact that the S&P 500's maximum drawdown has been -9.1%. Yet, underneath, it's been anything but. There have been deep drawdowns for the average stock, near record-low correlations, whipsawing breadth, and rotating sector leadership.

On the global equity front, we offer four scenarios and key signposts that can help investors assess how the artificial intelligence (AI) cycle may evolve.

And our fixed income insight lays out four key things we suggest investors understand about bond investing, from how bonds work to why today's yields may still offer opportunities.

Read more from our experts:

• Year to date, major equity indexes are sitting on double-digit gains and relatively tame maximum drawdowns, which gives the illusion that the market has been in a relatively calm state.
• Intense churn and rotation under the surface underscore that we are increasingly seeing a market of stocks as opposed to a stock market, which is not without potential opportunity.
• Dispersion is also evident in gross domestic product (GDP) data so far this year, as technology's and net exports' contributions and subtractions, respectively, are near record territory.

• The artificial intelligence (AI) innovation wave is proceeding quite rapidly relative to historical technological breakthroughs. Models are evolving quickly and the amount of capital spending (capex) for the underlying infrastructure has soared, with the potential to become one of the largest in history, based on academic forecasts.
• We remain in the early stages of this innovation wave. How AI evolves remains highly uncertain. In our piece this month, we present four potential scenarios: (1) productivity boom, (2) delayed payoff, (3) inflationary boom, and (4) deflationary bust.
• We're tracking these scenarios across a range of measures (or signposts) that fall into the categories of capex, financing, adoption, and economic payoff/monetization. Currently, capex remains strong but questions about the ability to finance it have risen while adoption and monetization are still in the early stages.
• Across global equities, the U.S. and emerging markets have the largest exposures to AI, while Europe and Japan are more company specific. Individual industries have both opportunities and risks associated with the evolution of AI. Companies may need to evolve with AI, sometimes disrupting existing businesses, or being disrupted themselves. For investors, diversification, selectivity, and flexibility may become increasingly important and market leadership may change over time.
• The U.S. midterm election outcome has added a new source of uncertainty to the AI cycle, with regulation and growing opposition to data center development potentially slowing the pace of investment and adoption. These risks, alongside market weakness in semiconductor and AI supply chain equities (the Bloomberg AI Value Chain Equal Weight Index is down 22% so far this quarter) raise the probability of a delayed payoff and a deflationary bust relative to our other scenarios.

• Many bond yields are still attractive. Despite some wide swings over the last few years, yields on many high-quality bonds remain near the high end of their 20-year ranges. That gives investors an opportunity to earn meaningful income.
• Bonds aren't risk-free, but they can be predictable. Barring a default, an individual bond held to maturity pays back its par value, even if its price bounces around along the way.
• We suggest investors focus on diversification. Different types of bonds have different risk profiles, and some investments, like high-yield bonds and preferred securities, tend to move more with stocks.
• Try not to wait for the "perfect" time to invest, as timing the market is difficult and not something we suggest. Consider starting with high-quality "core" bonds and choosing maturities that match your time horizon. If it fits your risk tolerance, add riskier investments like high-yield bonds or preferred securities in moderation.