Good morning,
Stocks were higher last week but you’re forgiven if you didn’t realize it.
Despite futures gapping violently lower last Sunday night, and just two days of gains last week, the S&P 500 climbed 5.7%, its best week since 2023 and just second weekly advance in the past two months.
In fact, last week was only the second time since 1950 that the S&P 500 has opened a week down more than 2% and gone on to close up by more than 5%.
The historic reversal was brought about by a midweek about-face on tariffs, with President Trump instituting a 90-day pause and lower rate for most countries, but increased tariffs on China.
We didn’t see any follow-through on Thursday, so the good news I have to report is mostly “so bad, it’s good” news.
Monday morning saw extreme washout conditions, with more than 80% of the S&P 500 trading to a one-month low and just over 5% of constituents trading above their 50-DMA. And the fact that the knife stopped falling means we now have “a low” to mark on the chart.
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