“Every day, we’re hearing multi-billion dollar partnerships and deals that are happening within the AI complex.” – 03:35

Michael Reinking, Senior Market Strategist at NYSE, joins Remy Blaire to discuss the current state of the U.S. stock market as November begins. The segment opens with a focus on the recent decline in U.S. stock futures, alongside warnings from CEOs of Goldman Sachs and Morgan Stanley about potential market drawdowns in the next 12 to 24 months.

Remy and Michael analyze the market’s pullback, attributing it to a broader trend of weakness observed over the past week. Michael highlights the deterioration in market breadth and the impact of comments from Federal Reserve Chair Jerome Powell, which have raised questions about the future direction of monetary policy. They also touch on the concerning price action in the cryptocurrency market, noting that speculative investments are beginning to unwind.

As they look ahead to the December Federal Reserve meeting, the conversation shifts to the mixed signals coming from Fed members. Some are advocating for rate cuts, while others express concerns about inflation, creating uncertainty in the economic landscape. Michael emphasizes the importance of upcoming economic data releases as they prepare for the Fed’s decisions.

The discussion then transitions to the ongoing earnings season, particularly focusing on the performance of major tech companies. Despite strong earnings reports, the market reaction has been mixed, with stocks like Palantir and Uber experiencing declines. Michael shares his bullish outlook on the industrial sector, driven by trends in reshoring and on-shoring, as well as the potential impact of tax cuts on consumer spending.

“Technology tends to exhibit upside leadership in strong tapes and during bull market cycles that have that good steep slope to them.” – 02:40

Remy Blaire welcomes Katie Stockton, the Founder and Managing Partner at Fairlead Strategies, to discuss the latest developments in the financial markets. The episode opens with a significant announcement: the Federal Reserve has cut interest rates by a quarter percentage point during its October meeting, marking the second reduction of the year and bringing the benchmark rate to a range of 3.75% to 4%. This decision comes as the 10-year Treasury yield rises back above 4%, despite a notable decline over the past month.

Remy and Katie begin their conversation by analyzing the S&P 500 index, which is currently hovering around the 6876 level. Katie explains that this level is crucial, as it represents an objective from the June breakout of the index. While this point may serve as a natural pause for the market, she emphasizes that the long-term momentum for the S&P remains strong, even though short-term momentum has slightly waned. Katie notes that recent gaps higher in the index may indicate a potential for a pullback, but she does not foresee a major decline at this time.

The discussion then shifts to a sector breakdown within the S&P 500, particularly in light of recent earnings reports and geopolitical developments. Katie highlights the technology sector’s continued dominance, noting its strong relative performance and leadership during bull market cycles. However, she also points out an interesting rotation occurring, with sectors such as healthcare and energy gaining relative momentum, suggesting a shift in market dynamics.

As the conversation progresses, Remy and Katie delve into the recent earnings reports from mega-cap tech companies, including Amazon and Apple. Katie provides a technical analysis of these “MAG 7” names, noting the dispersion in performance among them. While Amazon has experienced a breakout following its earnings, other companies like Microsoft and Meta are facing pullbacks. Katie stresses the importance of scrutinizing the fundamentals of these companies as investors navigate the evolving landscape.

“It’s really scary how overweighted the S&P is right now in the top 10 companies.” – 02:48

Patrick Mueller, President of Bella Advisors, joins Remy Blaire to discuss the mixed performance of major U.S. stock averages, with the S&P 500 and Nasdaq continuing their gains from October. We highlight the recent easing of U.S.-China trade tensions and the Federal Reserve’s ongoing rate cuts, with Chair Powell indicating that a December rate cut is not guaranteed.

Patrick shares his insights on tariffs and their long-term benefits for U.S. manufacturing, despite short-term pain for consumers. We also examined the concentration of the S&P 500, noting that the top 10% of stocks account for a significant portion of the index’s market cap, raising concerns about market vulnerability.

The pair discussed the current state of the 10-year yield and its implications for bonds and interest rates, particularly for those looking to refinance or secure mortgages. Patrick emphasized the importance of being cautious with investments, especially in the tech sector, given the potential for market corrections.

Lastly, Remy and Patrick touched on Warren Buffett’s recent decision to offload over $6 billion in stock, highlighting the significance of his cash reserves and the potential for future investment opportunities. Patrick advised listeners to consider taking profits and repositioning their investments to mitigate risks in a volatile market.