Yesterday’s session was against a backdrop of (real) breaking news, rampant speculation, and a loud chorus of doom.

There was an element of spunk early on as major indices reversed higher, but the deck was stacked against the market. Retail investors showed up, and Nvidia (NVDA) climbed off the session lows.  If the stock had gone positive, I think the floodgates of buying would have been flung open.

Be that as it may, it's clear most market participants, from retail to pros, agree the market is oversold, but nobody knows how it turns around.

Too Many

• There are too many unknowns.
• There are too many knowns.

When the dust settled, very few were holding onto the ghost, and the market drifted lower into the close. Only 25% of the S&P 500 (SPX) finished higher, and two sectors were in the green.

Grave Mistakes or Dishonest Actors

The Jensen story keeps sliding deeper into an abyss, and everyone is questioning everyone from the NVDA board to those charged with government oversight.

Internals

I've been writing and talking about “expensive foxholes.” Investors have been loath to get out of the market, so they have been overpaying for perceived safety.

Yesterday, they finally opted for the sidelines, which made the market decline worse, but it is the smart thing to do right now. Let the selling run its course.

The Value Proposition Keeps Improving

After the close, Cerebras Systems, Inc. (CBRS) posted monster earnings results and strong guidance. The stock popped in after-hours trading, but that hasn’t meant much these days. Still, all the good news that’s being steamrolled by the broad market retreat does matter and will count. Take notes, make a list, and be ready.

Today’s Session

The Producer Price Index came in slightly better than consensus, a sigh of relief.  Most of the upward pressure is coming from passenger air transportation.

Big News

This story will be underreported today, but it's huge. Samsung is in talks to buy Modine (MOD) for an undisclosed amount. Modine is considered a pure-play thermal-cooling company for data centers since it spun off its automotive business.

Three Things Stand Out

• Data centers will be built and need to be cooled.
• Samsung wants to diversify from memory but stay in the AI buildout arena.
• Stocks are significantly oversold – MOD is indicating up 27% (something to consider before taking huge losses at this point).

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