The S&P 500 Index and its top ETFs like VOO and SPY staged a strong comeback on Friday as investors bought the dip in technology stocks after big companies revealed their AI spending details. ...

Market Overview - U.S. stock futures declined on Monday following a positive close on Friday, with major benchmark indices trading lower [1] - The Dow Jones, S&P 500, and Nasdaq 100 experienced declines of 0.78%, 0.76%, and 1.04% respectively in premarket trading [4] Economic Indicators - Nonfarm payrolls increased by 50,000 in December, slightly below expectations of 60,000 and down from November's revised gain of 56,000 [2] - The 10-year Treasury bond yielded 4.19%, while the two-year bond was at 3.53%, with a 95% likelihood of the Federal Reserve keeping interest rates unchanged in January [3] Company Performance - Vistra Corp. (NYSE:VST) rose 0.69% after signing a 20-year nuclear power deal with Meta Platforms Inc. (NASDAQ:META) [7] - Alibaba Group Holding Ltd. (NYSE:BABA) increased by 4.44% as its Cloud's Qwen series became the most widely used open-source AI system, surpassing 700 million downloads [7] - Tempus AI Inc. (NASDAQ:TEM) jumped 8.12% after reporting a record $1.1 billion in total contract value and approximately 126% net revenue retention for 2025 [7] - Xpeng Inc. (NYSE:XPEV) gained 2.75% after unveiling its global 2026 P7+ flagship and reporting 126% delivery growth in 2025 [14] - Boot Barn Holdings Inc. (NYSE:BOOT) saw a slight decline of 0.37% despite reporting preliminary third-quarter net sales of $705.6 million, a 16.0% increase over the prior year [14] Sector Performance - Materials, utilities, and consumer discretionary stocks posted the largest gains on Friday, while health care and financial shares closed lower [9] - For the week, the S&P 500 rose 1%, with the Dow and Nasdaq increasing by 2.3% and 1.9% respectively [9] Upcoming Economic Data - Key economic data releases include December's NFIB optimism index, CPI data, and U.S. budget deficit, with several Federal Reserve officials scheduled to speak throughout the week [13][16]

When investors buy the S&P 500, they assume they're getting balanced exposure to America's largest companies. ...

Economic Growth - The U.S. economy experienced a significant growth of 4.3% annualized in Q3 2025, surpassing expectations of 3.3% and increasing from 3.8% in Q2 2025, marking the strongest growth since Q3 2023 [2] - Historical trends indicate that strong GDP quarters are often followed by slower growth, as seen after the 4.7% growth in Q3 2023, which dropped to 3.4% in Q4 2023 and further to 0.8% in Q1 2024 [3] Consumer Behavior and Economic Indicators - Consumer spending remains robust, driven by the wealth effect from rising asset prices, while inflation is declining but still elevated, contributing to a "Goldilocks scenario" for the economy [4] - Weak hiring trends in industries reliant on immigrant labor and softening retail sales in border states suggest potential challenges ahead [6] Prediction Markets and Future Growth Expectations - Prediction markets indicate a 20% chance of U.S. growth between 2% and 2.5% in Q4 2025, up from 17%, while the probability of growth below 1% increased to 14% [7] - The likelihood of growth exceeding 3.5% in Q4 2025 has decreased to 10%, down three percentage points, reflecting a fading conviction in another strong quarter [7] Recession and Monetary Policy Outlook - Despite the strong GDP data, the probability of a recession in 2026 remains stable at around 28%, having previously decreased from nearly 35% [8] - Traders anticipate multiple rate cuts from the Federal Reserve, with a 23% probability of three cuts in 2026 and a 22% chance of two cuts, indicating a dovish outlook on monetary policy [9]

Core Insights - The largest stocks in the US market are not only highly regarded globally but also represent the market itself, indicating a shift in the importance of stock-picking strategies [1] Group 1 - The founder of Sungarden Investment Publishing emphasizes a non-traditional approach to income investing, focusing on humility and discipline in navigating the modern investment climate [1] - The investment group aims to teach subscribers how to interpret market signals effectively [1]

Group 1 - The article suggests that 2026 may see a resurgence in bond investments as some investors shift focus away from AI stocks, which have experienced a bubble [1] - The author emphasizes the importance of listening to market narratives to navigate investment opportunities effectively [2] Group 2 - The author has a long position in SPY, indicating a bullish outlook on this investment vehicle [3] - The article does not provide specific investment recommendations but highlights the author's personal investment strategies and experiences [3]

Core Insights - The article provides an update on the performance of the S&P 500 and the Ivy Portfolio, highlighting that all five ETFs in the Ivy Portfolio remain in an "invest" position as of the end of October [5][7][14]. Ivy Portfolio Overview - The Ivy Portfolio is constructed using an asset allocation strategy similar to that of Harvard and Yale endowment funds, consisting of five ETFs that cover various asset classes [2]. - The strategy involves creating a diversified portfolio with equal weight across asset classes, calculating a 10-month moving average for each fund, and making buy/sell decisions based on whether the fund closes above or below this average [3]. Ivy Portfolio Performance - At the end of October, none of the five ETFs in the Ivy Portfolio closed below their 10-month or 12-month simple moving averages, indicating a continued "invest" position [5][7]. - The percentage above or below the moving average for each fund is tracked, with funds within 2% of the signal highlighted for potential position reversals [6]. S&P 500 Performance - The S&P 500 closed October with a monthly gain of 2.3%, marking the sixth consecutive month of gains, and closed 11.0% above its 10-month simple moving average [8][10]. - The index also closed 11.6% above its 12-month simple moving average, maintaining an "invest" position for six straight months [12]. Moving Averages Strategy - Utilizing a moving average strategy can effectively manage risks associated with bear markets, where holding the index is advised when it closes above the moving average and moving to cash when it closes below [9]. - The article illustrates that a 10- or 12-month simple moving average strategy would have allowed participation in most upside movements since 1995 while significantly reducing losses [10][15]. Psychological Factors - The article discusses the psychology behind momentum signals, noting that human behavior often leads to buying during market uptrends and selling during downturns, which can create cycles of buying and selling momentum [16]. Implementation Considerations - The moving average strategy is most effective when applied to specific investments rather than broad indices, as signals may differ due to factors like dividend reinvestment [17]. - The strategy is recommended for use in tax-advantaged accounts with low-cost brokerage services to maximize gains [18].

Core Insights - Multiple Bitcoin mining stocks experienced significant gains despite a market downturn triggered by President Trump's tariff announcement on China [1][2] Company Performance - HIVE (Nasdaq: HIVE) led the week with a 40% return from Monday open to Friday close [2] - BitFarms (Nasdaq: BITF) followed with a 31% return [2] - IREN (Nasdaq: IREN) shares nearly doubled, opening at $30.68 on September 10 and closing just under $60 on October 10 [3] Market Trends - The average one-month return for Bitcoin miners was 73.26% [3] - Despite the gains in Bitcoin mining stocks, broader asset classes faced declines, with BlackRock's IBIT Bitcoin ETF down 3.7%, and SPY and QQQ ETFs down 2.7% and 3.5%, respectively [2][4]

Core Insights - Despite a strong rebound in US stocks since April, overall investor sentiment remains cautious rather than euphoric [1][2] - JPMorgan analysts indicate that the current market rally is driven more by investors "chasing the trend" rather than excessive optimism [1][3] Market Positioning - JPMorgan's unique market sentiment indicator shows that investor positioning has been unexpectedly cautious, even "bearish," since early May [2][3] - This indicator turned negative in early May and peaked negatively by the end of June, indicating that investors found their positions to be more bearish than desired [3][4] Investor Behavior - As of early September, key participants such as hedge funds and speculative investors have not reached high stock exposure levels, reflecting a continued cautious sentiment [5][6] - Macro hedge funds' stock beta remains in a "moderate negative" range, while speculative investors' net long positions in US stock index futures have returned to near long-term median levels [5][6] Multi-Asset Fund Dynamics - The behavior of multi-asset investors shows a complex sentiment, with balanced funds' stock beta falling below average levels in recent weeks [7][8] - Risk parity funds exhibited more volatility, with their stock beta dropping below average in early April, rising above average in early August, and then falling again by the end of September [8]

Core Insights - The S&P 500 Index and its leading ETFs, such as SPY and VOO, have reached all-time highs this year, driven by favorable conditions in the artificial intelligence sector [1] Group 1 - The ongoing tailwinds in the artificial intelligence industry have significantly contributed to the surge in the S&P 500 Index [1]