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 winning and there is misery.” – Bill Parcells
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Futures are modestly higher heading into the last session of the week as the S&P 500 looks to end a five-day losing streak. There’s no economic data on the calendar, so whether we can end this streak will likely depend entirely on Powell’s 10 AM Jackson Hole speech.
In Europe, stocks are modestly higher on little in the way of news besides German GDP for Q2 being revised down more than expected to a decline of 0.3% versus forecasts for a decline of 0.1%.
In Asia, equities finished off a mixed week with a mixed session. Japan’s Nikkei finished slightly higher but down over 1% for the week. Chinese stocks were up over 1%, taking the weekly gain to more than 3%, while India traded down 0.9% on Friday but still managed to finish the week up nearly 1%. The main story out of the region was in China where Nvidia (NVDA) has reportedly stopped sales of its H20 chip to Chinese customers after that country’s government told local tech companies not to buy the chips citing security concerns. In response to the news, Chinese semiconductor names traded sharply higher.
It’s only been a week, but the general market tone heading into this Friday’s session is different than last Friday. For starters, we’re not sure where you are, but in the New York area, last Friday’s morning temperature was around 80 degrees, but this morning, we’re looking at a fall-like temperature of 58 degrees as we type this. In the equity market, last Friday, the S&P 500 was coming off its 3rd record closing high in a row and its 13th record high of the quarter. A rate cut at the next Fed meeting in September was pretty much a done deal.
Today, things look a lot less certain, the market is now pricing in just a 70% chance of a cut at the September meeting, and ahead of his Jackson Hole speech at 10 AM this morning, he probably won’t rule it out, but it doesn’t feel like Powell will make a forceful case to cut rates. With all the increased uncertainty, we’ve gone from a market closing at record highs to a 5-day losing streak that is tied for the longest since April 2024.
The last time the S&P 500 closed at a record high and then fell for five straight days was in January 2022 right at the start of the last bear market. There was also an occurrence right around the pre-Covid peak, and another near the dot-com peak in 2000. Any time you can make a connection between the current market and those three periods, it’s an ominous signal. Don’t they say that tops are a process? These all sound like pretty quick reversals!
Looking at ALL the occurrences where the S&P 500 hit a new high and then immediately went into a five-day losing streak, though, shows that there were plenty of occurrences within much longer-term bull markets.
