FedWatch's Ben Emons explains why he is bullish more record highs are in the future

Economic Outlook - The economy is potentially transitioning from a summer slowdown into an acceleration phase, supported by encouraging retail sales data [3][4] - Labor market weakness is contributing to the likelihood of a Federal Reserve rate cut [3] - An improved economic environment could lead to stock market gains [4] Monetary Policy - The market anticipates potential rate cuts, with some speculating up to 50 basis points [6][8] - The Federal Reserve may consider a 50 basis point rate cut as an "insurance" against a weakening labor market [8] - The Federal Reserve's balance sheet runoff, particularly the $35 billion per month in MBS runoff, is exerting subtle tightening pressure on financial conditions [10][11] - Ending the balance sheet runoff could alleviate pressure on the mortgage market [12][13] Investment Opportunities - Materials, staples, and energy sectors, which have underperformed in the recent rally, present attractive investment opportunities [15] - Electric equipment and AI power sectors have outperformed since April 8th [15]