See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium.  CLICK HERE to learn more and start your trial.

“There is a crack in everything, that’s how the light gets in.” – Leonard Cohen

Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.  

While the S&P 500’s price remains above its 50-day moving average (for now at least), its 10-day advance/decline line has moved into oversold territory for the first time since the April tariff tantrum.  This is indicative of an oversold market in the short-term, even though price looks neutral on the surface.

Futures are trading lower once again this morning as the bears have taken control.  So far this month, the year’s biggest winners have been hit the hardest, but those are also the names with the most lofty valuations.  Below are decile charts showing the performance of Russell 1,000 stocks month-to-date based on price-to-sales and price-to-earnings ratios.  Decile 10 in each chart contains the stocks with the highest of these two valuation metrics.  Stocks in the decile that contains the highest price-to-sales ratios are down an average of 3.6% this month, while stocks in the decile that includes the highest P/E ratios are down 4.8%.  Other deciles aren’t down nearly as much.

See what’s driving market performance around the world in today’s Morning Lineup. Bespoke’s Morning Lineup is the best way to start your trading day. Read it now by starting a two-week trial to Bespoke Premium.  CLICK HERE to learn more and start your trial.

“The problem with socialism is that you eventually run out of other peoples’ money.” – Margaret Thatcher

Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.  

We’re now in the back half of the Q3 earnings season, and probably the most consequential data point we’re seeing coming out of this season is continued strength in forward guidance.

Last earnings season was the first one following the tariff tantrum of the spring, and investors were pleasantly surprised that more companies raised guidance than lowered guidance.  That trend has continued in a big way this season, and with more than 1,000 companies reporting Q3 numbers thus far, we’ve seen 14% raise guidance compared to just 6% that have lowered guidance.  As shown below, our guidance spread chart, which shows the percentage of companies raising minus lowering guidance on a rolling three-month basis, has spiked to a level we’ve only seen once before, which was the period coming out of the COVID Crash in 2020.  These big spikes in guidance have historically happened in the early part of periods following max uncertainty.