The Monday Morning Playbook: Week of September 23, 2024

Good morning,

This month, Brown Technical Insights is celebrating its second anniversary and this past week, the first batch of annual subscriptions began rolling over for their third year.

From the bottom of my heart, thank you to each and every one of you who have made this possible and continue to trust me to deliver market insights and analysis week in and week out.

Now in this business, we all know nobody is right all the time or even close. But over the past two years, one of the things I’m most proud of is getting the major lows right, and importantly adding equity exposure just after the low rather than before.

That includes adding stocks and bonds in late October 2022 and increasing equity exposure on November 6 following last year’s fall correction.

Last week’s breakout to new highs means we can put one more on the list, after increasing equity exposure in the Balanced portfolio on August 6 and staying the course in early September, when many were calling for a double-top.

But as always, it’s onto the next one and the call going forward is what matters now. That call remains that more new highs are likely for the index.

A quick list of indexes and sectors that hit a new all-time high with the S&P 500 last week:

• The equal-weight S&P 500

• The Dow Jones Industrial Average

• The Russell MidCap Indexes (blend, growth, and value)

• Communication services sector

• Utilities sector

• Industrials sector

• Materials sector

• Consumer staples sector

• The NYSE Composite

• and the advance-decline lines for the S&P 500, NYSE Composite, and many more

And while that list is far from exhaustive, hopefully you’re getting the picture here:

It was and remains a bull market.

This is a time to be fully invested, to put new cash to work immediately, and to overweight stocks relative to bonds in balanced portfolios.

If you’ve been underinvested or missed the bottom, does that change the advice? Absolutely not. If you feel that it should, you’re succumbing to the sunk cost fallacy.

It doesn’t matter what has happened in the past, what you’ve done, or how much you’ve participated in the bull market so far. Your portfolio should reflect the outlook today and if it doesn’t:

Fix it.

This week’s report will review:

• Last week’s action and what happens after a new high for SPX

• What has (and hasn’t) broken out

• Breadth and defensive relative strength

• The bull and bear case for energy stocks

• Bond market reaction to the Fed’s 50 basis point cut

• and more!