On Friday, a jolt of lightning ran across the market on the news that Constellation Energy (CEG) reached a deal to reopen Three Mile Island to power Microsoft’s (MSFT) data centers. There hasn’t been this much excitement since The Electric Company TV show gave Sesame Street a run for the money.

Market Factors

Considering Thursday’s session, market internals weren’t pretty, but nobody seemed worried.

Greed is Back!

A week ago, the Fear & Greed Index was in the ‘fear’ zone. Now, it's racing toward ‘extreme greed.’

Fear & Greed Components

I like sharing this indicator, which has contrarian elements but also speaks to the human nature of momentum. These are the components:

Upside Bias

Coming into the week, momentum is clearly on the side of the rally, which should find buyers if it holds above the prior all-time high point.

Follow the Money

Cash is cascading into the market after a summer of indecision. Although earnings estimates are surging, the newfound desire to be in the market is primarily a vote of confidence in Jay Powell not to execute a soft landing but to become accommodative enough to bolster bottom lines.

Fed Speakers Hit the Streets

There was only one dissenter among Federal Open Market Committee (FOMC) voters last week, but none sounded like they were on board with a 50-basis points (bps) cut into the meeting. Now, these FOMC and Federal Reserve members must articulate support for the decision and play the delicate game of exuding confidence after a move customarily associated with panic.

There will be lots of data that will also move the needle – big time!

Today’s Session

The first fall session of 2024 gets off to a sleepy start ahead of a slew of economic data that have decisive impact on the markets.

The bottom line for the stock market is whether Jay Powell & Co have been able to steer the economy from recession and stick the so-called soft landing.

Tweet

 

Home | Products & Services | Education | In The Media | Help | About Us | Disclaimer | Privacy Policy | Terms of Use | All Rights Reserved.