The Lagnificent 7
Strength is broadening out
Calendar
Earnings
Big stuff this week ahead. Highlights will be NVIDIA, Home Depot, OKLO Full list here. Nvidia will of course be a hot one. Lets see how it shakes across the broader market but not expecting anything bad here at all, however market sentiment is heavy to the downside from Friday. Be mindful that markets tend to not bottom on Fridays given weekend risk.
Macro
At the very start of the year, in my first report '2025' that it was too early to make any assumptions, calls, or indeed hold views about what was coming. Are we all still alive given the past several weeks? Things are only now starting to take some form and shape.
‘‘It's not what we don't know that gets us in trouble. It's what we know for sure that just ain't so’’ Mark Twain. Josh Billings
FYI- Twain never said or wrote the above. Either way, you get the gist. Just when you think you know what's what, the world flips. Welcome to Trump town.
Selling: Friday past, US Services came out MISS 49.7 slipping under the 50 marker- the expansion/ contraction level. Risk asset’s had a sharply negative reaction to the downside, adding to a day where United health UNH 0.00%↑ was already weighing heavy (-12.5% on pre-market trade) on the DOW Jones performance. The catalyst -the Department of Justice was putting them under investigation for medicare billing.
$UNH constitutes 6.98% of the index, forcing the DOW well under average pricing on the Quarter and back into the auction area of the prior quarter (QPVAH to QPVAL). In the back half of the session, selling had re-accelerated and started to affect oil. The Daily mail published an article on a new COVID variant HKU5 with a mortality rate of approx 34%. The reason that this is not being laughed out of the press is the Moderna and Pfizer stock accelerated on the back of the article and oil saw some selling-through range supports. I would like to laugh at this as much as you, however, when you see something get priced in, it tends to straighten you up.
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