Yesterday, 69% of the S&P 500 (SPX) finished higher, but the Technology (XLK) selloff continued, and there was nowhere to hide; meanwhile, new 52-week lows on the NASDAQ climbed to 402.

S.O.S. for SOX – the Semiconductor Index tumbled below the 200-day moving average. The next major support point comes at 7,000.

Software (IGV) has some support here; after that, support comes at the 200-day moving average.

Data Center

Data center measures are on at least 50 local ballots in 13 states: Arkansas, California, Florida, Illinois, Kansas, Maine, Michigan, Nevada, New Hampshire, New Jersey, North Dakota, Ohio, and Wisconsin. Data centers have been huge economic drivers, but messaging matters.

Today could be the election calm before the storm. The market has rallied in the six and twelve months after midterm elections 100% of the time – keep that in mind should things get rocky.

Earnings Update

After the close, most stocks edged higher after posting results. Such moves have had the lifespan of a housefly, but it's good to know which names, under ordinary circumstances, delivered the goods and wanted to trade higher.

Today’s Session

You may hear a lot about Paul Singer and his acronym, FOGO, today.  There is no doubt fear is dominant in the market right now – so much so that it's drowning out fundamentals. The irony of fearing getting obliterated is that it leads to panic selling and losses.

Singer lays out his reasoning for comparing the current market to the boom before the Great Depression, writing that “nearly every major bear market alarm is now ringing.” His $80 billion fund has shifted to defensive posturing, prioritizing capital preservation. 

The fund returned less than 2% in the first nine months of the year, while the S&P 500 was up 13%.

This isn’t the first of Paul Singer's warnings during the ChatGPT bull market.  In the early stages of the February 2023 rally, Singer cautioned that a 20% drop wouldn’t be enough.

Current Reasons for a Crash

• US Fiscal Deficit
• Sticky Inflation
• Private Credit Risks

AI Investment Bubble

Every year, there have been reasons for a crash since this leg of the secular rally began.

Tweet

 

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