The Morning Call---I give up.

 

The Morning Call

 

2/4/26

 

The Market

         

    Technical

 

            Tuesday in the charts.

            https://www.zerohedge.com/markets/tech-wrecks-crypto-crashes-bullion-bond-yields-bounce

 

Note: how often do I note ‘follow through’? Yesterday’s pin action put a cloud over the S&P’s slightly positive performance last week. The bad news is that it closed below the ever present former all-time high; the good news is that it bounced off its 50 DMA. Bottom line, with all the back and forth around that former all-time high, I am going to give up trying to call a breakout or a failed breakout. Buyers and sellers are in a pitched battle. I am in my foxhole until it’s over. As always, follow through.

 

            Tuesday in the technical stats.

            https://www.barchart.com/stocks/momentum

            https://www.barchart.com/stocks/sectors/rankings

            https://www.barchart.com/stocks/signals/new-recommendations

           

            As goes January, so goes the year.

            https://www.carsongroup.com/insights/blog/so-goes-january-so-goes-the-year/

 

            In the meantime, downside convexity builds.

            https://www.zerohedge.com/the-market-ear/software-cracks-credit-blinks-spx-still-pretends-downside-convexity-builds

 

            Why do equities tend to correct in February?

            https://www.zerohedge.com/markets/why-does-equity-market-tend-correct-february

 

    Fundamental

 

       Headlines

 

              The Economy

 

                        US

 

Weekly mortgage applications fell 8.9% while purchase applications were down 14.0%.

 

The January ADP private payrolls report showed job increases of 22,000 versus expectations of 35,000.

 

The February economic optimism index was reported at 48.8 versus forecasts of 47.0.

 

                        International

 

January EU flash CPI came in at -0.5% versus projections of -0.4%; January PPI was down 0.3% versus +0.2%.

 

The January Japanese services PMI was 53.7 versus estimates of 53.4; the composite PMI was 53.1 versus 52.8; the January Chinese services PMI was 52.3 versus 51.5; the composite PMI was 51.5 versus 50.9; the January German services PMI was 52.4 versus 53.2; the composite PMI was 52.1 versus 52.5; the January EU services PMI was 51.6 versus 51.9; the composite PMI was 51.3 versus 51.5; the January UK services PMI was 53.7 versus 53.9; the composite PMI was 54.0 versus 54.3.

 

                        Other

 

                          Update on the state of freight.

                          https://bonddad.blogspot.com/2026/02/the-state-of-freight-is-mainly.html

 

                          The consumer sentiment puzzle.

                          https://www.ft.com/content/f3edc83f-1fd0-4d65-b773-89bec9043987

                       

            Fiscal Policy

 

              On the national debt, the left and right have become one.

              https://www.realclearmarkets.com/articles/2026/02/03/on_the_national_debt_left_and_right_have_become_one_1162306.html

 

              Crony socialism.

              https://www.wsj.com/opinion/usa-rare-earth-commerce-department-trump-administration-china-cd010507?mod=opinion_lead_pos3

 

            Kevin Warsh

 

              What Warsh learned from Druckenmiller.

                          https://www.wsj.com/economy/central-banking/what-kevin-warsh-learned-working-for-stanley-druckenmiller-7fc07efe?mod=economy_lead_pos2

 

 

              Will Warsh fix the Fed?

              https://www.advisorperspectives.com/commentaries/2026/02/03/will-kevin-warsh-fix-fed

 

     Investing

 

            What is your risk tolerance?

            https://alhambrapartners.com/weekly-market-pulse-whats-your-risk-tolerance/?src=news

 

            Why the selloff in gold likely isn’t over.

                        https://www.marketwatch.com/story/heres-the-real-reason-gold-prices-plunged-and-why-the-selloff-likely-isnt-over-yet-d6141fd1?st=NieUVE

 

            January dividends by the numbers.

            https://politicalcalculations.blogspot.com/2026/02/dividends-by-numbers-in-january-2026.html

 

            Update on valuations.

            https://www.advisorperspectives.com/dshort/updates/2026/02/03/market-valuation-is-the-market-still-overvalued

 

            A warning to gold investors.

            https://www.zerohedge.com/precious-metals/gold-investors-remember-1933

 

    News on Stocks in Our Portfolios

 

 

 

What I am reading today

 

           

 

 

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