What the Fed Decision Means
By John Lau August 1, 2024 – The Fed met dovish expectations yesterday and reinforced one of the key supports for the 2024 rally: the idea of looming rate cuts. Powell all but said a September rate cut was coming and also (and importantly) floated the idea that the Fed could cut “several” times in […]
Back To Normal?
August 1, 2024 Good morning, Markets got back to “normal” yesterday if we define normal as the way they’ve been acting for about 2yrs up until July. Mega caps reestablished their dominance yesterday (and this morning) at the expense of 290-ish other S&P stocks and the entire Russell 2000. Rotation was yesterday and Fed rate cuts […]
It Only Matters When It Spikes Higher
July 29, 2024 Good morning, From a market analysis point of view, last week’s spike in volatility might have been the most significant development of the week. Yes, the S&P 500 Index (SPX) saw its first 2% down day in nearly a year, and the NASDAQ Composite Index saw its biggest one-day decline since 2022 […]
What Does Yesterday’s Pain For All Consensus Trades Mean
July 25, 2024 Good morning, Over the past few months, I’ve expressed concerns about the long-term health of the equity market related to a possible recession late this year or early next year. Long-term is measured in months/quarters, and it is outside the usual discounting mechanism of the market. That mechanism carries the “discount” label […]
It’s Earnings, Earnings, Earnings, Now
July 22, 2024 By the looks of the way equity futures are trading this morning (+.50% to +1.0%, broadly speaking), last week’s stock-market gyrations suddenly seem all but forgotten. On the week last week, the CBOE Volatility Index (VIX) moved up to a three-month high as stocks sold off, driven by overbought technicals, a global IT outage, […]
It’s About Market Cap – Or Lack Thereof
July 18, 2024 The Big Rotation, as it was labeled last week, has been less of a pivot from rally-leading equity sectors (like mega-caps) and more of a mad-dash into rally-lagging sectors (like small caps). I use the term mad-dash to underscore what seemed to be an emotionally charged scramble by traders rather than a […]