Inside Markets — Consolidation
The SPX has extended into technical channel resistance in the 6725-6805 zone and will likely consolidate gains in the information vacuum preceding Q3 earnings season.
Inside Markets — AI Bubble Watch
Reports about a potential AI bubble aren’t surprising, given that high private company valuations and performance concentration in public markets were also present in late ’99-early 2000.
Inside Markets — Fed Discourse
Some discourse has emerged over whether it is appropriate for the Fed to begin cutting rates while equity markets make new highs.
Inside Markets — Seasonal Weakness and Proverbs
The three main factors that contribute to September-early October seasonal weakness are fund flows, earnings estimate revisions and October fiscal year-end for active mutual funds.
Inside Markets — Easing Cycle
The RTY should outperform in a declining rate environment as small cap companies tend to utilize floating rate debt.
Inside Markets — Near-Term Caution
The SPX keeps its bullish shape above ~6350, which means the primary trend is still higher despite seasonal headwinds, increased supply and fading fund flows in the back half of September.
Inside Markets — CPI Preview
Core CPI will be the focus for Thursday’s print, where we look for a +0.3% MoM increase, which equates to a 3.1% on a YoY basis.
Inside Markets — Rally Exhaustion
The SPX is showing clear evidence of rally exhaustion, but the bullish trend remains intact above ~6350.
Inside Markets — Software Recovery
Software has meaningfully lagged the broader S&P 500 and semiconductor industry YTD leading to a very low level of sentiment and positioning in the space.
Inside Markets — Transitory
Tariff-related price adjustments will result in higher observable inflation over the next few months.