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The Fear & Greed Index swung deep into “fear” yesterday, which shouldn’t surprise anyone given the market's mounting carnage.  The numbers are devastating.

There were 1,013 new lows on NYSE & NASDAQ Composite against 88 new highs.

Recession Shift?

Health Care (XLV) and Consumer Staples (XLP) are traditional safe havens in rough market times, and it’s a rough time.  This summer, and earlier this year, broad weakness sent investors into Technology (XLK), especially mega-cap names. Now investors are rotating into traditional foxholes.

But is there more to the story?

When I see dollar store stocks moving higher, it gives me pause, especially at this moment.

Wage Growth is Slowing as the Fed Erects More Speedbumps

The last jobs report came in below consensus, but average hourly earnings didn't keep up with inflation.  We’ve seen pay rise for lower and middle income households this year, but that’s fading.

Killing the Golden Goose

As the midterms near, and the chances of Democrats winning both chambers of Congress gains credibility, one has to imagine it will further fuel the anti-data center movement.

This would be a self-inflicted disaster of monumental proportions. I mentioned wage increases for regular folks, and much of that is for carpenters and electricians, the construction workers building data centers.  Many municipalities are already seeing huge increases in their tax revenue.  If data centers are killed, we might as well build more dollar stores.

Maybe it’s a pause that refreshes and simply consolidates after a strong spurt, but bond yields are easing a bit.

Time for the Turn?

Yesterday marked the spot when the market historically turns higher and begins the year-end rally.  That could happen soon, though I’m not sure of a catalyst beyond the main driver: short-term oversold.

At this point, we start sharpening the buy list and holding names under severe pressure without any signs that the value proposition has changed.  It's too soon to buy new long ideas and too early to add, but it's time to get opportunistic.

After the Close

Numbers are out from Anthropic’s closed-door meeting with investors yesterday.  Revenue is up 45% from the second quarter, and the company continues to dominate enterprise share.

I’m sure cynics will pounce, but I was bracing for a lower number, so I’m pleasantly surprised.

Today’s Session

Another overnight bloodbath in the South Korean stock market (KOSPI) sets the stage for big-tech selling out of the gate this morning.

Fundamentals are completely detached at this point, as narrative-driven emotions are steering the bus. In other words, “selling begets selling.”

The Kospi failed to hold its 200-day moving average, meaning it could quickly retest the July swoon low point (which must hold) or find the next technical support around 5,000. The names in focus start reporting next week and could spark oversold rebounds.

PPI came in at 1.3% against consensus of 0.6%. The components that go into PCE (below) suggest a bigger number next time it’s posted.

Comments

In markets like this, let's remember that sellers can't sell without buyers. David G. on 10/15/2026 10:20:22 AM

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