The Morning Call
7/28/26
The
Market
Technical
Monday in the
charts.
Monday in the technical
stats.
https://www.barchart.com/stocks/momentum
https://www.barchart.com/stocks/market-performance
https://www.barchart.com/stocks/sectors/rankings
https://www.barchart.com/stocks/signals/new-recommendations
Still a long way
to go in AI correction.
Goldman desk points to level equities will
struggle.
Gold
isn’t returning….confidence is leaving.
https://www.zerohedge.com/precious-metals/gold-isnt-returning-confidence-leaving
Tuesday morning
setup: Futures extend Monday's losses as the Tech tape continues to unravel;
global Semis were hit yesterday and again overnight (despite the best attempts
of Goldman and JPM to force retail to buy the falling knives) with Asian stocks
and especially Korea (-10%) bearing the brunt with fears of Chinese competition
accelerating the sell-off and then spilling back over into the US. As of 7:00am
ET, S&P futures are down 0.2% with tech slammed pushing the Nasdaq
0.9% lower and leaving the index set for a five-day run of losses for only the
second time this year. Semis are again lower pre-market led by
weakness in Nvidia, Intel and Micron, while Mag7 names are mostly bid and
outperforming. While Defensives are leading Cyclicals, there are bids to
Discretionary and Financials as both sectors look to outperform. As JPM writes
in its Market Intel post this morning (available to pro subs),
the market is swept in a risk-off tone (where
all the news continues to be sold) that is continuing both the
broadening in the US and a rotation ex-US where EU may continue to outperform
as investors tilt towards Value; the $64 trillion question remains when
do Semis / AI find a bottom. There is some good news as expectations
(because they certainly are not taking place) of US, Iran
negotiations are reducing commodity prices. As such yields are down 3bps, the
USD is flat, and commodities are weaker led by Energy and Precious with Base
and Softs the outperformers. Today’s macro data focus is on the weekly ADP
print, Housing price indices, Consumer Confidence, Import / Export data,
Inventories, and regional Fed activity indicators. n premarket trading,
chip producers and other AI-related firms are extending their selloff as
worries about China’s progress in advanced chipmaking weighs down sentiment.
This is also exasperating concerns over the sustainability of the AI spending
boom that has propelled the sector in recent years.
Fundamental
Headlines
The
Economy
US
The
July Dallas Fed manufacturing index came in at 1.3 versus estimates of -1.0.
International
Other
Shipping upheaval suggests oil price decline
won’t last.
The
latest Q2 GDP nowcast.
https://www.capitalspectator.com/resilient-q2-gdp-nowcast-masks-for-the-rest-of-the-year/
The distorting impact of inflation on durable
goods orders.
https://bonddad.blogspot.com/2026/07/two-cheers-for-increasing-manufacturers.html
Monetary
Policy
How important is
the Fed? (I agree with most of this
article. My one point of disagreement is
that ‘money supply is a function of production’. My counter is ask Germany and Argentina.)
Fiscal
Policy
State capitalism is back in fashion.
Summary:
Politicians worldwide are showing renewed enthusiasm for public ownership of
private companies, with methods ranging from modest government stakes to
outright nationalization.
History
shows that public ownership is almost always a mistake, and market-friendly,
arms-length regulation is a more reliable way of achieving stated goals.
Public
ownership can lead to capture, where producers' interests are prioritized over
those of customers and the wider public, resulting in inefficiency and
underperformance.
AI
Should you be worried?
https://www.riskhedge.com/outplacement/are-you-worried
The
AI capex depreciation risk is the catch to record earnings.
AI’s moment of truth.
The mess is your moat.
https://www.apollo.com/wealth/insights-news/insights/daily-spark/the-mess-is-your-moat
The AI bubble’s canary.
Tariffs
Saying the quiet part out loud.
https://www.realclearmarkets.com/blog/2026/07/24/saying_the_quiet_part_out_loud_1196528.html
What do the latest tariffs mean for the US economy.
Investing
Bond market gets edgier about inflation and
the massive (growing) federal debt.
Confidence is back (?) but earnings show that
the consumer is being picky.
Risk events are everywhere.
News on Stocks in Our Portfolios
What
I am reading today
Five
truths about retirement.
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