Fresh color regarding large-cap growth is all the rage among analyst chats as relate to dispersion of funds, to limit risks into the Election and thereafter. It is not quite that simple and between value & growth, you’ve had big hardware AI stocks basically suck the money into that sector; while we’re there too; but in more recent times focused on ancillary beneficiaries: ‘application software’.True, that’s stodgy if not occasionally painful to sustain; while investors need to recognize that this time of year not only are more ‘shakeouts’ than we’ve seen likely; but tax-selling and shuffling (rearranging the Titanic deckchairs to some degree) is to be expected, as money managers try to position for 2025.It’s also perverse that Gold is so strong in a ‘bull’ equity market; but partially it is reflection of fears regarding near-term risks rising (over-valuation for S&P), plus foreign money possibly hiding in Gold & Silver; vs. less reliable crypto. We were optimistic for a long-term move up in the ‘metals’ but wouldn’t chase as these could spike and reverse concurrent with a future S&P trough after a prospective shakeout. It’s all tricky; as ‘good news’ may precede ‘bad news’; and on top of all the geopolitics, and debates about victims and beneficiaries of the hurricanes (in terms of reconstruction); there is also the coming ‘Vote’.While this October’s Expiration was stable-to-firm (about as expected), we’re not sanguine about the next couple weeks, based on geopolitics more so than domestic politics.Needless to say we’ll have to see how the ‘tight’ election goes; but we’re in a favorable growth environment, with downside risk more pertinent shorter-term than further out. To wit: dips in areas folks favor will be accumulated, while on occasion you’ll see some ‘tax-gains’ taken in big-caps postponed into 2025 if it is feasible to wait; while these patterns could result in an ‘inversion’ next year of greater proportion than usual; as small-caps revive (some dramatically with business models that conform to where investors want to be…smaller AI and a smattering of basic stocks, perhaps while some big-caps retreat for awhile).All that is ‘pending and variable’; just bringing up the logic as relates to values as well, since the smaller stocks, once bereft of pressures, should get relief. If history is an indication, this could eventually get dangerous for S&P; even for next year, but for anything that dramatic I’m not talking of Q1 dips before rally.Market X-ray: well, Expiration is behind, so the ‘next’ short-term moves might relate to efforts to extend S&P post-Expiration, but then falter, for some sort of short-term decline. Underlying that will be money managers knowing they want to accumulate for 2025.Tech earnings are going to be very important keys to Q4 and next year. Likely helpful, but valuations are ridiculous in the large-caps, or even in some areas that aren’t exact AI / tech, like the Netflix multiple, which is stratospheric. That is just an example, but yes, money has been running around chasing already expensive stocks, and while you can’t identify the spot the music stops; it’s so far mostly been a ‘musical chairs’ game where are the ‘seats’ are in big tech.For next year, true growth comes from Federal policies that support increases in productive investments, the beginning off multi-year reconstruction with big changes in the damaged coastal areas (at least there should be, given ‘flood plain’ risk; coastal surge risk, and everything about rising tides contributing to this situation, as we’ve discussed over the last few years, not just recently. So I find it hard incidentally, to have excessive sympathy for wealthy folks that got into uninsured coastal homes, because it didn’t take rocket science to see this on the horizon.. we did.. and I’m no rocket scientist (so there’s humility haha).Also we have innovation, much of which will related to ‘application software’, mostly involving AI, with continued interest in ‘why’ money managers haven’t significantly moved into the non-hardware stocks; although quietly they may. Obvious beneficiaries of the hurricanes can be steel, cement, home-buildersThat will also involve the efficient allocation of resources; and shifting staffing given that many communities with small businesses that are people-intensive will again have problems from AI both in manufacturing and creativity. For an investor, we should hope for those policies. As citizens, those are the policies we should demand the candidates discuss more about; but generally they are not delving into the weeds of what must actually be done.. or certainly about a post-war (post both wars) environment that changes the military/industrial mix .. not so much funding away from it, but toward sophisticated difficult-to-target weaponry; and not behemoths that the era of drones and hypersonics show, to be not just vulnerable, but sometimes a hindrance to getting the jobs done.Bottom line: no sense of urgency for the S&P; actually turmoil might appear in the days ahead; but again, really depends on events; primarily external and not yet directly influenced by upcoming U.S. Elections…presumably not yet.I still think any weakness in weeks ahead will be used by money managers to sort of ‘spread their wings’ with broader accumulation for 2025 in their minds. A simple extension or post-Expiration retreat ‘probably’ won’t be too dramatic.By the way, Cigna and Humana are resuming ‘merger talks’, interesting given this is the start of the annual ‘Open Enrollment period. And while consumers of course will welcome (to the extent covered) lower caps and drug prices; it’s likely squeezing the margins and perhaps that has a role in their discussions.(I think CVS is dragged-down by all these; and ventured far afield right into a competitive landscape, which now even includes Amazon prescriptions. For me if you combine storm losses, reinsurance headaches, and healthcare, I’m not inclined to be involved in any of these insurance or Rx-related stocks.)More By This Author:Market Briefing For Wednesday, Oct 16Market Briefing For Friday, Oct 11Market Briefing For Wednesday, Oct 9