S&P 500 consolidated sharp Thursday‘s gains called, with still bullish bias. Opex premarket dip was bought, concluding a great week of client gains delivered – so what led to it?BoJ blinked and was summoned to the Parliament to explain the rate raising (Nikkei dropped more than S&P 500 that Monday), Iran‘s response didn’t materialize, and all the incoming data turned out favorably – PPI and CPI stepped up the main indices, and it were mainly retail sales and unemployment claims that dialed back the recession now fears. Emergency rate cut calls evaporated, and rate cutting odds were actually dialed back, because Friday‘s consumer confidence outweighed poor housing data earlier in the day.Yet another intraday dip was bought, and we‘re heading to a tighter range week marked by manufacturing and services PMI with Jackson Hole. Let‘s drop a few initial hints as to where we‘re in the risk-on move before I specify sectoral prospects in the premium part – similarly to what I did for clients in the run up to CPI Wednesday, and then again ahead of Thursday fireworks.– it is once again soft landing the mainstream bet. What does that do to corporate profits? With the Fed about to ease, the only question being whether that is to satisfy or disappoint the markets near term? Markets are to face rate cuts realism Friday.
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