Yesterday, the S&P 500 (SPX) closed above 6,500 for the first time, notching another 100-point increase, the fifth this year. The good news is that these 100-point milestones tend to come in bunches (12 in 2021 and 2024).

Move Over Mag Seven

Six sectors finished the session higher, but the most compelling was Technology (XLK), which led the way without “Mag Seven” doing any heavy lifting.

Eight of the top ten advances were Technology names, and one was Communication Services (XLC).

Don’t Bury Me…I’m Not Dead

Monster results after the closing bell. Most of the names that crushed the consensus had been down for the count, in part due to Artificial Intelligence (AI), but also due to missteps. Interestingly, many are using AI to make a comeback.

Autodesk (ADSK) was being called a victim of AI, but the business has never been better.

Cook Goes to Court

Let's chalk up round one to Fed Gov. Lisa Cook, even though the hearing doesn’t begin until 10:00 a.m. today. I’m not being cynical; this is the era of activist judges, and I see no way Judge Jia Cobb would decide anything in favor of President Trump.

In many ways, this underscores the problem at the Federal Reserve. Ideology is becoming a bigger factor in decision-making than data and common sense. I’m no lawyer, but claiming mortgage fraud was an innocent mistake is a challenging defense that may not have been effective for others who faced similar accusations.

Better Part of Valor

Where this thing goes legally remains to be seen, but I still contend the better part of valor is for Cook to step aside.

Everyone has seen the videos – she hates Trump and has pledged to go against his agenda, which means monstrous decisions that could go against Main Street.

Even The Economist, which has become ultra-left in recent years, agrees.

As for the market – I’m pumped. 

But we need to see more names participating. It might be happening right now.

Today's Session

PCE increased 0.2% M/M in July, decelerating from a 0.3% rise in June and in-line with forecasts. Prices for goods were down 0.1% after a 0.4% rise in June, while services accelerated to a 0.3% increase from a 0.2% increase in June.

Core PCE rose by 0.3% in July, the same as the prior month.

Thus far, mentions of PCE finish with the comments that “the market is moving lower.” In fact, equity futures have improved since the release of the PCE.

The inference that there is an adverse reaction to the data is unfortunate.

 

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