Core Insights - The earnings season is commencing with major banks reporting, amidst a backdrop of record U.S. indices and a government shutdown [1] - Wall Street analysts have raised earnings estimates for the first time since late 2021, projecting an 8% year-over-year earnings growth for the S&P 500, marking the ninth consecutive quarter of expansion [2] Financial Sector Outlook - Financials are expected to lead this earnings season, with major banks like JPMorgan Chase, Citigroup, and Wells Fargo reporting [3] - M&A activity is showing signs of recovery, with Q3 seeing 111 M&A announcements and global M&A volumes reaching $1.26 trillion, a 40% year-over-year increase [3][4] - The IPO market is also reviving, with 150 IPO announcements in Q3, the best quarter since Q4 2021, indicating a healthier outlook for capital markets [3] Interest Income and Lending - Net Interest Income (NII) is under pressure, with modest growth expected as banks face competition for deposits [4] - Loan growth has been sluggish due to high borrowing costs, but banks are signaling optimism following better-than-expected loan growth in Q2 [5] Credit Quality and Trading - Credit quality remains stable, but any increase in delinquencies will be closely monitored, particularly in commercial real estate and among lower-to-middle income borrowers [6] - Trading is expected to be a strong performer due to market volatility driven by Fed policy changes and geopolitical uncertainty [6] Sector Performance Expectations - The technology sector is projected to outperform, with over 20% earnings growth driven by the AI sector, while consumer staples and discretionary sectors are expected to see declines in earnings [7][11] - AI corporate spending is contributing significantly to U.S. GDP growth, accounting for approximately 40% this year [10] Earnings Season Timeline - The peak of the Q3 earnings season is anticipated between October 27 and November 14, with November 7 expected to be the most active day [12] Market Sentiment - The current earnings season is characterized by a bifurcated market, with optimism in the tech sector contrasted by challenges in other sectors, setting a high bar for companies to meet [13]

Core Viewpoint - The Retail Sector ETF (XRT) has fallen below its 50-day moving average, indicating potential weakness in the retail sector and consumer sentiment, which could signal broader market fatigue [1][4][11] Retail Sector Analysis - The decline below the 50-day moving average is not merely a technical issue but reflects a sentiment shift, suggesting that American consumers may be losing purchasing power [2][5] - If XRT does not recover quickly, it may indicate a transition from a bullish to a cautious market phase, potentially leading to distribution [3][11] - The retail sector is crucial as it represents the pulse of consumer spending, which accounts for 70% of U.S. GDP; a weakening retail sector could precede broader economic challenges [4][5] Economic Indicators - Rising living costs, student loan repayments, and increasing credit card delinquencies are pressuring consumer resilience [9] - The equal-weight construction of XRT reveals that average retailers are struggling, contrasting with the performance of larger cap-weighted companies [9] - Breadth deterioration in the retail sector often foreshadows weakness in small-cap stocks and transportation indices [9] Technical Analysis - The XRT closed below its 50-day moving average after multiple failed attempts to maintain above it, with momentum indicators like RSI showing declining buying pressure [8] - Key levels to watch include $83.11, which must hold to avoid confirming a warning phase, and the need for two consecutive closes above the 50-DMA to restore a bullish bias [7] - The XRT vs. SPY ratio is falling, indicating a defensive rotation in the market [7] Market Implications - If retail stocks continue to weaken, it could narrow the Federal Reserve's path to rate cuts, not due to rising inflation but because of declining growth [6] - The timing of the retail sector's weakness is critical as it may represent the first sign of cracks in the "soft landing" narrative for the economy [5][6] - Monitoring small-cap stocks (IWM) alongside retail performance is essential; simultaneous failures could lead to a rapid unwinding of risk-on trades [10]

Core Viewpoint - Advanced Micro Devices (AMD) has experienced a significant price increase of over 30% following an agreement with OpenAI, indicating strong market interest and bullish sentiment around the stock [1]. Group 1: Price Movement and Technical Analysis - AMD is currently retesting the March 2024 highs, which suggests that the stock may be in the late stages of its recovery phase [2]. - The price action has formed a clear five-wave rise from the lows in April 2025, confirming the bullish structure anticipated earlier [1]. Group 2: Market Sentiment and Risks - Despite the prevailing bullish sentiment, there is a potential risk of a market reversal in the coming weeks, which could lead to the filling of open gaps below the current price levels [2].

Core Insights - U.S. companies are on track to achieve a record $1.1 trillion in share buybacks by the end of 2025, with $1 trillion already announced as of August 20, 2025 [1][4] - Despite the high dollar value of buybacks, the number of companies announcing buybacks has reached an all-time low, with only 34 announcements in Q3 2025 [1][4] - Buybacks among S&P 500 companies fell by 20% in Q2 2025, totaling $235 billion compared to $293 billion in Q1 2025 [2][3] Buyback Trends - The top 20 S&P 500 companies accounted for 51.3% of total buyback authorizations in Q2 2025, significantly above the historical average of 44.5% [3][4] - Major contributors to buybacks include technology giants like Apple and Alphabet, as well as banks such as JPMorgan Chase, Bank of America, and Morgan Stanley [3] Economic Context - Companies are utilizing buybacks as a strategic method to deploy excess capital amidst trade policy uncertainty, which has affected business planning and spending [6] - Robust earnings growth and tax cuts have contributed to increased corporate cash reserves, supporting the stock market rally [5][6] Future Outlook - The Q3 earnings season beginning October 14, 2025, will be crucial for monitoring buyback announcements, which may indicate corporate confidence and willingness to invest in shareholder value [7]

Core Insights - The article discusses the "trifecta of inflation," which includes the weakening U.S. dollar, rising prices of hard assets like gold and silver, and the dynamics of food staples like sugar and oil as indicators of inflationary pressures [1][2][4][11]. Group 1: Inflation Indicators - The U.S. dollar has declined approximately 10% in 2025, contributing to import inflation and asset-price inflation in dollar terms [2]. - Gold prices are reaching new highs, and silver has outperformed gold in returns so far in 2025, indicating rising inflation pressure [3][6]. - The strength of the ratio between silver and gold supports inflation expectations, especially in conjunction with dollar weakness [4]. Group 2: Types of Inflation - Demand-Pull Inflation occurs when demand outpaces supply, often due to a booming economy and strong consumer spending [5]. - Cost-Push Inflation arises when production costs increase, influenced by factors such as energy prices, commodities, and wages [5]. - Built-In/Wage-Price Inflation is a self-reinforcing cycle where higher wages lead to higher prices, which in turn leads to more wage demands [5]. Group 3: Commodity Analysis - Sugar prices have fallen approximately 16.99% year-over-year as of September 2025, which does not confirm the inflation signal but may reverse due to its volatility [8]. - Oil prices are volatile and influenced by OPEC+ supply decisions and geopolitical risks, acting as a shadow driver in the inflation narrative [9][10]. - Sustained oil prices above $90–100 per barrel could reignite broad inflation fears, reinforcing the inflationary cycle [11]. Group 4: Market Implications - The combination of two strong inflation indicators (weak dollar and rising silver/gold prices) alongside oil's influence suggests elevated inflation risks, even without sugar's confirmation [11]. - If sugar joins the rally with oil, it could lead to a more persistent inflation cycle, challenging the Federal Reserve's easing narrative [11].

Last week I wrote a market update speculating on whether the Russell 2000 (IWM) had put in a technical pattern called triple tops, or if IWM will clear the highs of 2021, 2024 and now 2025 and keep screaming higher.And, if we look at the lows of the last 3 weeks, in sequence the prices are 235.42, 236.75, and this week 237.55. So far.I will get more concerned if we close this week under 237.55 as that breaks the pattern of consistent higher lows. Sign up for our FREE newsletter and receive our best tra ...

Group 1: Russell 2000 ETF (IWM) Analysis - The Russell 2000 ETF (IWM) is currently facing a potential triple top pattern, indicating a bearish reversal from an uptrend to a downtrend [1][2] - The support level for IWM is identified around 210-215, with recent price rejections at higher levels [3] - Recent lows for IWM over the last three weeks are 235.42, 236.75, and 237.55, with a concern for a potential breakdown if the price closes below 237.55 [4] Group 2: Retail Sector ETF (XRT) Insights - The Retail Sector ETF (XRT) reached a peak high last week, but overall performance is underwhelming compared to the all-time highs of 2021 at 104 [6] - A potential reversal top is forming for XRT, with a critical level at 86.46; closing below this could signal a larger correction [7][8] - If a correction occurs, a decline to the 80 area is anticipated, with current performance on par with the benchmark [9]

The TSX (Canadian stock index) is now up 22% so far in 2025, one of the leading markets globally. And much of this performance is thanks to the TSX having a healthy amount of gold miners in the index.The gold miners’ weight in the TSX has obviously been climbing, starting the year at 7.2% and now about 9.4%.  This subcategory of the Materials sector is responsible for about one third of the TSX’s advance. The golds contributed 6.7% — without them the TSX would be a more average +15%.Gold bullion prices ...

Company payouts are stronger compared to previous years, despite brewing macro risksA weaker dollar and resilient consumer spending support record earnings and stock prices, even amid cautious CEO sentimentWe spot key events as the calendar flips to October, along with happenings at the biggest U.S. bankDividend-increase announcements are on the rise. According to the Wall Street Horizon research team, 71.9% of all dividend changes have been positive so far in 2025. That tops the comparable year-to-date f ...

Core Insights - The performance of oil and gas stocks and ETFs has been underwhelming compared to other energy sectors like nuclear, coal, solar, and hydrogen [1] - There is potential for a change in this trend, as oil and gas prices are currently low on futures exchanges [2] Price Movement Analysis - The US Oil ETF (NYSEARCA: USO) has not had two consecutive closes above the 50-day moving average (50-DMA) since the end of August, indicating a lack of sustained upward momentum [4][10] - A close above the 50-DMA is seen as a confirmation of buyer commitment, with two consecutive closes being a stronger indicator of a trend shift [5][6][11] Trading Strategy - Traders are advised to wait for two consecutive closes above the 50-DMA to confirm a bullish trend in oil [12] - Similarly, for natural gas, two consecutive closes above the 50-DMA are necessary to determine if it has bottomed out [13]