Good morning,
Last week’s Playbook highlighted the risk-on leadership we had seen in the week prior, but cautioned that the conditions that preceded it (tech oversold, defensives overbought) made it more likely that defensive leadership would resume.
Unfortunately, that’s exactly what happened. Aided by a poor reaction to Nvidia’s earnings, defensives, staples, and low vol bounced back, while risk-on areas dragged the S&P 500 lower for the week.
The bearish case continues to build, and while the S&P’s trading range continues, my base case is that it resolves lower.
Today’s report will review:
Risk basket performance last week
Key levels to watch on Nvidia and financials
March seasonality
Why flows represent a risk to the late-cycle cyclicals
How investors' fixed-income portfolios should be positioned
and more!
