Group 1 - The dollar index (DXY) has recovered from a 1.5-month low, increasing by +0.08% due to higher T-note yields strengthening interest rate differentials and prompting short covering in the dollar [1] - Preliminary benchmark payroll revisions indicated a loss of -911,000 jobs in the US through March 2025, which is a wider loss than the expected -700,000, signaling a weaker labor market [3] - The markets are now pricing in a 10% chance of a 50 basis point rate cut at the upcoming FOMC meeting on September 16-17, a significant shift from previous expectations of zero chance [4] Group 2 - The euro (EUR/USD) fell by -0.21% from a 1.5-month high due to the dollar's rebound, compounded by a significant decline in French manufacturing production [5] - French manufacturing production for July decreased by -1.7% month-over-month, which was worse than the expected decline of -1.2% and marked the largest drop in 14 months [6]

Market Sentiment & Trading Behavior - Concerns about state capitalism and government intervention in private sector companies are unsettling, but short-term market reactions, driven by the "buy the dip" mentality of retail traders, persist [2][3] - The "buy the dip" strategy is evident in the outperformance of meme stocks and heavily shorted stocks, suggesting retail traders are either ignoring concerns or trained to buy on dips [4] Corporate Earnings & Fundamentals - Corporate earnings have been a support for the market, with actual earnings in the second quarter doubling consensus expectations [6][7] - Analysts may not have fully extrapolated the strong first half of the year into future earnings estimates, potentially setting up for another positive surprise in the third quarter [7] - Valuation concerns remain, and corrective phases similar to those seen in mid-February to early April may occur [8] Small Cap Performance & Fed Policy - The Russell 2000 and S&P 600 have outperformed the S&P 500 quarter-to-date, with returns comfortably above 7%, roughly double the S&P's return [10] - Prospects of Fed easing, potentially starting in September, and relative calm in the bond market are supporting small caps [10] - Approximately 40% of the Russell 2000 consists of non-profitable and zombie companies, making small caps vulnerable if the Fed's easing policy changes [11]

Fundstrat head of research and Fundstrat Capital CIO Tom Lee, also a CNBC contributor, joins me here. Tom, good to see you. Great to see you.So, we have this rally that's now extending uh probably beyond what most were positioned for, but it started in a moment of peak uncertainty. Yes. And even when we were in peak uncertainty, a lot of us were saying that's kind of usually forward-looking bullish.But are we now getting to a point where we have finally feasted on all of the uncertainty and now we have a lo ...

Market Outlook - CNBC's Fed survey participants show growing optimism about the outlook for markets, anticipating a bounce back in the economy and stocks in 2026 [1] - The survey projects the S&P 500 to reach 6133 by year-end, a 15% increase, and 6625 in 2026, nearly a 10% increase from yesterday's close [2] - Equity markets are near all-time highs, anticipating certainty on tariffs, extension of the 2017 tax cuts, deregulation, AI productivity, and Fed easing, potentially leading to economic reacceleration in the second half into 2026 [2][3] Interest Rates and Monetary Policy - The survey indicates no expectation for a rate cut next month, with the funds rate remaining above the long run neutral rate into 2026 [4][5] - The survey builds in two rate cuts for this year and one for next year [4][5] Fiscal Policy and Deficit - 82% of respondents believe the tax bill will increase the deficit [3] - Opinions are divided on the tax bill's impact on growth, with 29% more optimistic, 29% less optimistic, and 43% believing it doesn't matter [3][4] Inflation and Tariffs - A 43% to 32% margin believes tariffs will be one-time price increases rather than creating broader inflation [6] - 61% of respondents anticipate tariff inflation is yet to come in the months ahead [6]