In case you missed it: Tuesday's rally was not driven solely by the Magnificent 7
Russell 2000 index of small-cap stocks soared a staggering 5.4%, as investors bet the Fed is done raising rates and could be cutting interest rates much sooner than expected. Source: HolgerZ, Bloomberg
"Mag 7" darling Nvidia $NVDA finished the day with its highest closing price in history
And the stock has now traded green for 10 consecutive trading days, its longest winning streak since December 2016. Source: Barchart
Yesterday was the best market breadth day in the US since the Covid-19 stress exit...
Source: Lawrence McDonald, Bloomberg
JUST IN: Futures now show a 0% chance of additional rate hikes with rate cuts beginning in May 2024
Prior to today's CPI report, there was a 30% chance of at least one more rate hike ahead. Rate cuts were expected to begin in June 2024. Now, markets are pricing-in at least 4 rate CUTS in 2024. Markets are betting that the Fed is done. Source: The Kobeissi Letter
What kills bull markets
Nice visual by @safalniveshak thru Brian Feroldi
Has there been a better pairs trade than long US, short world... ever?
This relationship has generated steady alpha for a decade and a half now. Growth over value and large over small have also been excellent long / short pairs. Source: Steven Strazza
When the book on 2023 closes, extreme sector divergence will surely be considered one of the major plot points
Technology and Communication Services are each up more than 40% YTD, while five of eleven sectors are in the red on the year. Source: Bespoke
Tech relative to small caps JUST hit the highest level EVER seen This ratio is higher than even the peak of the Dot Com bubble
Source: Game of Trades
