The equity market is entering a period of consolidation characterized by "chop" as investors anticipate the upcoming Consumer Price Index (CPI) data. Robust earnings revisions, particularly within the hyperscaler and semiconductor sectors, continue to support market firmness, though these gains are heavily influenced by paper valuations in AI ventures like OpenAI and Anthropic. While the S&P 500 equal-weighted index (RSP) shows encouraging signs of broadening participation by outperforming the standard index, emerging weakness in the labor market presents a growing concern. Recent nonfarm payroll data indicates a disinflationary trend in wages and potential job shedding in tech and government sectors. Despite these labor risks, technical indicators for the QQQ remain bullish, with the index maintaining a position above the 10-week EMA and targeting the 765 level, provided it holds key support at 709.
Sign in to continue reading, translating and more.
Open full episode in Podwise