U.S. Futures & World Markets
Stocks are flat premarket as the market digests 10-year US Treasury yields hitting new post-2020 highs. Lingering concerns on AI development and crude sitting around $100 per barrel have investors hitting the pause button.
On midterms: Polymarket as of Friday put Republicans retaining the House at just 12%. A Democratic sweep has even odds. But changing your stock market exposure based on the likely election outcome is probably a bad idea. The average stock market performance for all six-month periods following midterm elections since 1970 has been good. During Obama's two terms, healthcare had a 14.2% annualized return — despite him campaigning on overhauling it. Despite Biden's green credentials, fossil-fuel companies were the best performers when he was in office. Earnings and interest rates still matter a lot more than Washington headlines.
CORE Headlines
- SoftBank receives loan for OpenAI investment. Masa Son loves himself some leverage! — Bloomberg
- NVIDIA, Palantir, and Booz Allen Hamilton restrict AI model use. — The Information
- OpenAI quietly bought Glass Imaging, a startup developing AI camera technology for smartphones. — WSJ
- Wegovy maker Novo Nordisk rebranding as "Novo." — WSJ
- A Chinese official called AI the "core engine of a new round of technological revolution" and the main battleground of its rivalry with the US. — WSJ
- Treasury identified Russia's VTB Bank as a key financial node for Iran and slapped it with more sanctions. — WSJ
Charts & Data
Aggregate equity positioning at the 58th percentile. Discretionary investors at the 34th percentile (modestly underweight); systematic strategies at the 86th percentile — highest in 11 months. Deutsche Bank via Daily Chartbook.
CTAs sold $16B of global equities last week. At current price and volatility, CTAs are expected to sell another $19.5B this week. Goldman via The Market Ear.
Asset managers and institutional investors remain clearly underexposed to equities. The gap vs. market-weight positioning is the widest since this bull market began in late 2022. Duality Research via Daily Chartbook.
Hedge funds net bought US TMT stocks in 10 of the last 11 sessions — the recent pace of long buying ranks in the 97th percentile on a 5-year lookback. Goldman via Daily Chartbook.
Buyback blackout begins this week on Sep 15 — approximately 40% of S&P 500 corporates enter their quiet periods, tempering one of the market's most consistent demand sources. Goldman via The Market Ear.
SPX 1-month put skew jumped to the 73rd percentile from the 36th percentile just a week ago — hedging demand picked up sharply. Mandy Xu, CBOE via Daily Chartbook.
For the first time since early April 2026, more NYSE stocks are making 52-week lows than 52-week highs. Grant Hawkridge via Daily Chartbook.
S&P 500 has generated an average return of +9% during the 12 months following the first hike. Goldman expects the bull market to continue. Goldman via Daily Chartbook.
S&P 500 forward earnings rising at a faster pace in recent weeks — the underlying trend in actual earnings remains very strongly to the upside. Yardeni Research via Daily Chartbook.
S&P 1500 Software revenue per employee has gone parabolic. If you're looking for evidence that AI is starting to impact the real economy, this is exhibit A. @warrenpies via Daily Chartbook.
Global chip stocks at just 15.8x forward earnings — near the lowest since the 2022 bear market. Standard Chartered via Daily Chartbook.
Interesting Reads
- Will driverless cars increase or reduce urban density? — The Antiplanner
- Who depends most on US-Canada trade? — Visual Capitalist
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