U.S. Futures & World Markets

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Intel's beat-and-raise earnings last night are giving a needed jolt to tech stocks as the market tries to recover from yesterday's selloff. The S&P 500 finished down 1.2%, but the real damage was concentrated in consumer discretionary and communication services. Google helped lead the decline, with both sectors falling more than 5%.

Crude is trading lower after hitting $100 per barrel yesterday — up almost 20% in the last five trading days and at its highest level since March. While the TACO trade (Trump Always Chickens Out) is still the consensus view, if oil starts living above $100 instead of just visiting it, stocks and the broader economy are likely to feel some real pain.

Next week will be action-packed. A Fed meeting with rate hike odds by year-end above 90%. Big Tech earnings from Apple, Amazon, Microsoft, and Meta. Boeing, UPS, Visa, Starbucks, Qualcomm, Chipotle, Robinhood, P&G, Exxon, and Chevron. Between the Fed, earnings, and oil, there will be plenty for the market to digest.

S&P Futures vs. Fair Value: +22.00  |  10-Year Yield: 4.68%

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Charts & Data

BTFD returns losing steam. @bluekurtic via Daily Chartbook: "The buy the dip strategy in the S&P 500 is losing steam in 2026. Average 5-day return following a dip is running noticeably lower than what we saw over the prior two years."

New business applications with high propensity to create jobs are improving notably. Variant Perception via Daily Chartbook: a positive leading indicator for the labor market even as broader hiring remains muted.

Initial jobless claims dropped by 22k to 187k — the lowest level in almost 60 years. Daily Chartbook: "This series continues to point to a low-hire, low-fire labor market."

OBBBA tax gains could be mostly offset by higher energy costs. UBS via Daily Chartbook: the fiscal tailwind from tax cuts may be largely neutralized by oil-driven inflation hitting consumers.

Inflation volatility approaching levels seen at the pandemic price surge — driving higher bond market volatility. Bloomberg via Daily Chartbook: under-the-surface component volatility is alarming even as headline CPI looks contained.

Demand for corporate debt remains robust — AI buildout is not crowding out private sector financing. RSM via Daily Chartbook: "Despite a large increase in private sector paper linked to the AI buildout, public issuance of debt does not appear to be crowding out private sector financial needs."

Hedge fund net allocations to semis pulled back from a record 14% of US Prime books to ~11% — still in the 96th percentile over 5 years. Goldman Sachs via Daily Chartbook: historically elevated positioning even after the drawdown.

Asset manager long positioning in VIX futures at the 1st percentile — nobody is hedging. Nomura via Daily Chartbook: complacency in the protection market at an extreme reading.

Only 7 times in 20 years have SPY and QQQ gapped down over 1% while oil gapped up over 5%. Six of those came right before big drawdowns. @bluekurtic via Daily Chartbook: a cautionary historical data point for bulls heading into the long weekend.

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