Given how much oil and yields have spiked over the past month, the equities market has been remarkably resilient. There is a lot of rotation under the hood, from Semis to Software, alongside a broader commodities and crypto rally.
The overall picture may appear confusing at first - something must give, right?
My read is that the market is willing to do the uphill push, climbing a wall of worries.
That doesn’t mean there won’t be bumps on the way. We can still get an index correction going into October due to the above issues, but I’m optimistic about the year-end. The S&P is in a firm structural uptrend, with valuations no longer extreme.
Come 2027, if the hyperscalers realise the ROI on their insane CapEx doesn’t justify all the spending, it could then be the start of the domino effect.
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Disclaimer
This newsletter is intended for educational purposes only. Any information or analysis in this note does not constitute an offer to sell or a solicitation of an offer to buy any securities.
Nothing in this note is intended to be investment advice, nor should it be relied upon to make investment decisions. Any opinions, analyses, or probabilities expressed in this note are those of the author as of the note's date of publication and are subject to change without notice.