Markets Will Wobble But Not Collapse: 3-Minute MLIV

Market Volatility and Macro Events - NVIDIA earnings, while generally positive, may lead to a sell-off due to high market expectations and global significance [2][3] - The market hasn't shown panic pullbacks, which is comforting, despite VIX spikes potentially driven by high valuations and market narrowness [6][7] - Valuations alone are not a catalyst for sell-offs, but market wobbles are expected given the chaotic US data release schedule [8][9] Sectoral Impact and Correlations - A feed-through from tech sell-offs is expected in sectors like euro stocks (13% tech), tech, and industrials, while defensive stocks like utilities may outperform [4] - The correlation between Bitcoin and the Nasdaq is attributed to retail flows and market linkages, but concerns exist regarding crypto assets due to valuation difficulties and volatility [5][6] Economic Outlook - The fundamental backdrop remains strong, with a trade truce, Washington reopening, and a Fed terminal rate of 3%, all positive for equities [10] - The absence of irrational exuberance, with investors being more bearish than bullish, is a positive sign, suggesting the market is not in a bubble [7][8]