November 11, 2025 • 15 mins
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Welcome to the Deep Dive. Today we're really digging into
Tuesday, November 11th, 2025. What a day in the markets wasn't
just volatile, it felt fundamentally fractured.
Fractured is a good word, maybe even split personality.
It was definitely one of the most divergent trading sessions
we've seen all year, right? And that divergent is the key.
If you look at the afternoon wrap up sources, the market
(00:21):
literally seemed to tear into you.
Had this massive rally in old economy stocks.
Just pure euphoria driven by relief.
And on the other side. Real pain, genuine contagion,
hitting those big tech names, especially the AI stocks that
have been, you know, leading everything for two years.
So our mission today is to unpack that schism, right, get
(00:42):
into the causes, look at the market internals and try to make
sense of it for. You exactly translate the noise
into something actionable. And the central conflict?
It's almost hard to believe the Dow Jones surging, what, 600
points at its peak? Is this huge risk on move?
Yeah, fueled by this collective sigh of relief, which we'll get
into. But at the same time, the NASDAQ
(01:02):
gets hit with actual fear, like proper risk off selling,
specifically hammering artificial intelligence.
It signals a really powerful rotation happening under the
surface. Could be painful for some it.
Felt like a real tug of war. Definitely, and the strength of
that robo, that tells you a lot about what might come next.
OK, let's start with the headline numbers, the closing
(01:23):
figures, because just looking atthose, you might miss the drama
underneath. How did the indexes capture this
tale of two tapes? Well, the S&P 500, you know, the
broad market benchmark, it kind of showed that middle ground.
It eked out just a tiny gain of 26 points.
So plus basic sheet .38%. Fairly positive.
Right. And it spent the whole morning
in the red. It was clearly caught right in
(01:44):
the middle of these two opposingforces.
So what about the extremes then?The Dow.
The Dow was the undisputed star of the show, Rallied huge 530, 9
points up. That's one point, 1% getting
close to a new record high actually.
And that was broad based. Very broad cyclicals, value
stocks, the whole sort of old economy complex was celebrating.
(02:06):
And the flip side, the NASDAQ. That's where the pain was.
The NASDAQ Composite closed down.4%.
It led the losses for the day, really confirming where that
selling pressure was concentrated.
OK. So that kind of divergent
doesn't just happen. There have got to be two really
strong opposing stories driving this.
Let's tackle the good news first.
(02:27):
What was this Washington tailwind lifting the Dow?
It was basically a massive sigh of relief from Washington DC.
The main driver was news that the government shut down.
The longest ever 42 days is finally ending.
Finally. Yeah.
The Senate approved the deal late Monday.
The House vote is expected any minute now, and the president's
indicated he'll sign it. So it's pretty much a done deal.
(02:49):
OK, That removes a huge cloud ofuncertainty, stops the economic
leading from things like, you know, flight delays and whatnot.
But is the market maybe getting ahead of itself here, betting on
cyclicals before the data actually confirms things are OK?
That's a really sharp point. Yes, the market is
forward-looking. The relief isn't just about the
immediate disruptions ending, although that helps confidence.
(03:10):
The crucial bit for investors and the Fed is that the data
blackout ends. Key inflation reports,
employment numbers, We haven't had them.
The Feds been, as the source material puts it, flying blind.
OK, so getting that data back means the Fed can actually make
informed decisions, especially heading into that critical
December meeting. Exactly.
It restores some predictability.So the market's basically
(03:33):
betting that the US economy avoids this self afflicted wound
and that momentum is coming back.
So that sparks this big rotationinto the economically sensitive
stuff. Cyclicals value names you
mentioned healthcare industrialslit up.
Precisely. That's the resolution story in a
nutshell. OK, Now for the dark side, the
NASDAQ. Why did AI stocks get hit so
(03:54):
hard? You mentioned NVIDIA
specifically. What turned selling into actual
contagion? It was a nasty double whammy.
Really shook confidence in that whole AI valuation narrative.
First catalyst. Kind of a bolosha ring moment.
NVIDIA, the absolute poster child of the AI boom, dropped
3%. Why?
Because the Japanese tech giant SoftBank revealed they'd sold
(04:17):
their entire stake last month, We're talking $5.83 billion
worth. Wow, their entire stake from a
major player like SoftBank. Yeah, that signals massive
profit taking from someone very sophisticated.
It definitely spooked market, made people wonder if, you know,
maybe the peak is in or close. What?
Was the big signal. What was the second hit?
You said it was maybe more fundamental.
(04:39):
It came from a company called Core Weave, ticker CRWV.
They're an AI focused cloud provider and importantly, a huge
customer. Invidious chips, right?
They plunged over 14% today. They reported a delay in
building out a data center, which means they're going to
miss their Q4 earnings expectations.
Ouch. So that's the Canary in the coal
mine. Pretty much it's the first
(04:59):
really hard evidence that this spend it all costs frenzy on AI
infrastructure might be hitting,I don't know, logistical
hurdles, maybe financial limits.So you have one big investor
cashing out question to the valuation, and then a key
customer stumbling, questioning the actual pace of spending.
Why did that ripple out so widely?
Because the whole AI sector has been trading on this promise,
(05:21):
this assumption of just relentless spending growth.
The SoftBank news hit the valuation story, the core Weave
news hit the execution story, got her put them together, and
it sent shock waves right through the AI supply chain.
We saw other key AI infrastructure stocks, think
Micron, Oracle, Palantir, they all fell more than 2% just in
sympathy. That's your contagion.
(05:42):
OK, this tale of two tapes idea seems solid.
To really prove it though, we need to dig into the market
internals. Let's start with the VIX, the
fear gauge. Now wait a second.
Dow soaring, S&P slightly green.Surely the VIX went down.
You'd think so, wouldn't you? But no, the VIX actually closed
up .37 on the day, finishing at 17.97.
(06:04):
On a day like today. Exactly.
That's a major bearish divergent.
It's a huge red flag. What does that tell you?
It tells you that even though most of the market was feeling
pretty good, investors were actively, maybe even
frantically, buying downside protection.
Put options specifically on those big, heavily weighted tech
stocks. So the fear in NVIDIA and its
peers just overwhelmed the calm everywhere else.
(06:26):
Pretty much the demand for protection in that narrow
leadership group was intense enough to lift the whole VIX
index. It's statistically quite
significant when you see that kind of.
Split, OK, so VIX up is bearish divergent, what about market
breadth, the advanced decline line, did the average stock have
a better? Day.
Oh, absolutely. Breadth was incredibly strong.
(06:46):
Actually. Depending on the exact count,
somewhere between 72% and 75% ofall stocks in the S&P 500
finished positive. That's around 360 companies
gaining ground. Wow.
OK, so that confirms the theory perfectly.
The average stock did great, butthe S&P 500 index itself barely
moved because those few losing stocks, the big AI names, carry
(07:07):
such enormous weight. Textbook example of strong
breath being masked by weak leadership at the very top in
terms of market cap. But there's always a but, isn't
there? There's a wrinkle in that nice
breath story when we look deeper, right?
Talk about the new 52 week highsversus lows.
Yeah, this is where you see the underlying fragility.
Despite the Dow rally and the decent breath, we actually saw
(07:29):
172 stocks hit a new 52 week lowtoday.
A. 172 lows How many highs? Only 110 hitting a new 52 week
high. Oh, that's not good.
More lows than highs on a day the Dow surged over 500 points.
It's a major internal divergent and a really healthy broad
rally. You want to see new highs
(07:51):
swamping new lows. The fact that more stocks are
still breaking down suggests themarket's foundation isn't as
solid as the Dow might make you think.
The rally isn't lifting all boats.
Still some damage underneath. OK, let's follow.
The money sector performance should really paint the picture
of this rotation. Where do the cash actually flow
today? It's almost a perfect mirror
image of the Divergent 10 out ofthe 11 S&P sectors finished in
(08:13):
the green. Guess which one was red?
Has to be technology XLK. Bingo.
Technology was the only loser dragged down by that AI
contagion we talked about. The money flowed pretty much
everywhere else, specifically into old economy and what you
might call defensive value. So who are the big winners
sector wise? Healthcare really stood out.
(08:33):
It's kind of a defensive play, but also has value
characteristics right now. We saw strong moves in Merck up
4%, Amgen up over 3%, Johnson and Johnson up over 2%.
A defensive value? What?
Else, industrial surged. That's your pure cyclical bet on
the shutdown ending and economicactivity picking up.
And interestingly, even consumerstaples saw inflows.
(08:54):
Staples like soap and cereal companies, They've been dogs for
years. Exactly.
But today, investors were fleeing the high flying, high
risk tech names and looking for safety and just bare necessity
stocks. A real flight to perceived
safety, even into sectors that have underperformed for ages.
Fascinating rotation. OK, let's drill down to some
specific stock movers that were driven by News Today.
(09:15):
Paramount Skydance PSKY rocketedup 8.4% but didn't they miss on
earnings? They did their first report
since the merger. Missed on revenue, missed on
profit, but the market completely looked past the
rearview mirror. So why the huge jump?
It was all about the future. New management came out with a
really aggressive plan to cut costs.
(09:36):
They jacked up their synergy target to $3 billion.
So investors basically said OK, we ignore the past.
We're betting on this turn around story.
A pure forward-looking bet. Got it, Turn around play.
Then there was FedEx FDX, up 6%.That sounds like a macro story.
Absolutely. FedEx is a classic economic
bellwether, right? They actually increase their
(09:56):
profit forecast for the holiday season.
Oh. Really.
Despite everything. Yep, and that was seen as a huge
vote of confidence in the US consumer, in the economy
bouncing back, tying directly into that optimism about the
shutdown ending. Perfect link.
And on the losing side, we have to mention NVIDIA again down 3%.
Just to recap that SoftBank exit, the core weave contagion,
(10:16):
it really hit the narrative hard.
It really did. I think for the first time,
investors are seriously asking questions about just how
sustainable that breakneck pace of AI infrastructure spending
really is. Is there a limit?
Are we hitting it? Big questions.
Now we need to zoom out. Today was veteran's day, which
had a massive impact on the broader market context, didn't
(10:38):
it? What happened across other
assets? Yeah, this is maybe the most
critical piece of context for today's equity move because it
was Veteran's Day, the US bond market was completely closed.
Right, no bond trading at all. None, which means this entire
violent rotation we just described, Dow up, NASDAQ down,
value over growth. It all happened in what you
could call a ghost market. Yeah, it happened without the
(11:01):
bond market getting its vote. The bond markets vote on
inflation, on growth expectations.
Exactly. So tomorrow when the cash bond
market reopens, that is going tobe the real test of whether
today's equity rally, especiallyin cyclicals, has legs.
Huge point. OK, so bonds closed.
What about the US dollar? The dollar index, the DXY, it
actually pulled back about 1/4 percent, down to around 99.38.
(11:25):
Which makes sense. If it's risk on the shutdown,
resolution removed one key reason to hold the dollar as a
safe haven, so investors felt comfortable selling the dollar
and moving into riskier cyclicalassets elsewhere.
Classic risk on move. OK, but then gold was also up
close around $4138.00 an ounce. That seems a bit contradictory.
(11:46):
Selling the safe haven dollar but buying safe haven gold.
It perfectly highlights the split personality of the day.
Yes, gold got a mechanical lift from the weaker dollar.
That's part of it, sure. But more importantly, I think
investors were buying gold as a hedge.
A hedge against what? Against a potential tech LED
market correction given those cracks we just saw in NVIDIA and
the AI leaders. So they're participating in the
(12:08):
cyclical rally, but hedging their bets with gold in case
tech really rolls over. Hedging the euphoria makes
sense. And finally, crude oil WTI was
up nicely. Yeah, WTI crude surged about
1.6% back over $61.00 a barrel. This is probably the purest
shutdown ending trade you could find today.
Well, crude prices have been weak on worries about
oversupply. Today's jump basically reverses
(12:29):
that. It's a direct bet that with the
US government back online, economic activity will pick up
and demand for energy will rebound.
Pure growth optimism. OK, so today really sets the
stage for a critical next 24 hours.
What do we need to watch tonightand tomorrow to see if this
rotation sticks? Tonight after the bell, the big
one for tech traders is the AMD Financial Analyst Day.
(12:51):
Talk about timing. Right after NVIDIA gets
hammered. Exactly.
All eyes will be on AMD, Nvidia's chief competitor.
Can they steal the narrative? What do they say about AI
spending? Their commentary is going to set
the tone for tech tomorrow, no question.
We also get earnings from Alcon,Amdocs and Haileen tonight.
OK, AMD is key tonight. What about the docket for
(13:13):
Wednesday? Sounds like it could be massive
now that the shutdown's over. It's huge, sort of a triple
threat. First, as we said, the bond
market reopens, we get a 10 yearnote auction to that's the acid
test for today's rally. Test #1 Bonds.
Test #2 the Fed. We get a whole parade of Fed
speakers. Williams, Waller, Bostic,
Collins It's their first real chance to react publicly to the
(13:35):
shutdown ending and the new fiscal picture.
What do they signal? Test #2 fed reaction.
And test #3 more tech earnings. Crucially, another semiconductor
firm, Global Foundries GFS, reports before the market opens,
along with Transdime TDG. Will GFS confirm the core weave
weakness or push back against it?
(13:56):
You also mentioned oil data. Yeah, the OPEC monthly report
and the usual API a inventory data will tell us if today's
crude rally was just a one off or if there's something more
sustainable. There.
OK. So pulling this all together
after a really turbulent day, what does this mean for you, the
investor looking your portfolio tonight?
Well, I think the main take awayis that this wasn't just noise.
(14:17):
This was a high volume, pretty violent rotation.
It really felt like it could be a passing of the baton from that
magnificent 7 AI driven trade, which let's face it, some
strategist think is looking pretty late stage over to the
more traditional old economy, blue chips, healthcare, maybe
even staples, the stuff that's been left behind.
(14:37):
So the big question everyone needs to ask themselves tonight
is pretty simple, isn't it? I think so.
Was today just a one day head fake, you know, driven by relief
about the shutdown? Or is this the start of the real
great rotation that value investors have been waiting and
waiting for? And the answer depends on.
The answer really lies with those bond traders tomorrow
(14:58):
morning and what that parade of Fed speakers tells us.
Their collective vote is likely going to dictate market
direction for, well, probably the rest of the quarter.
What a fascinating setup. Thanks for walking us through
that incredible market divergenttoday, connecting all those dots
between the headlines, the internals and the class asset
moves. Really appreciate you joining us
for this deep dive.
Welcome to the Deep Dive. Today we're really digging into
Tuesday, November 11th, 2025. What a day in the markets wasn't
just volatile, it felt fundamentally fractured.
Fractured is a good word, maybe even split personality.
It was definitely one of the most divergent trading sessions
we've seen all year, right? And that divergent is the key.
If you look at the afternoon wrap up sources, the market
(00:21):
literally seemed to tear into you.
Had this massive rally in old economy stocks.
Just pure euphoria driven by relief.
And on the other side. Real pain, genuine contagion,
hitting those big tech names, especially the AI stocks that
have been, you know, leading everything for two years.
So our mission today is to unpack that schism, right, get
(00:42):
into the causes, look at the market internals and try to make
sense of it for. You exactly translate the noise
into something actionable. And the central conflict?
It's almost hard to believe the Dow Jones surging, what, 600
points at its peak? Is this huge risk on move?
Yeah, fueled by this collective sigh of relief, which we'll get
into. But at the same time, the NASDAQ
(01:02):
gets hit with actual fear, like proper risk off selling,
specifically hammering artificial intelligence.
It signals a really powerful rotation happening under the
surface. Could be painful for some it.
Felt like a real tug of war. Definitely, and the strength of
that robo, that tells you a lot about what might come next.
OK, let's start with the headline numbers, the closing
(01:23):
figures, because just looking atthose, you might miss the drama
underneath. How did the indexes capture this
tale of two tapes? Well, the S&P 500, you know, the
broad market benchmark, it kind of showed that middle ground.
It eked out just a tiny gain of 26 points.
So plus basic sheet .38%. Fairly positive.
Right. And it spent the whole morning
in the red. It was clearly caught right in
(01:44):
the middle of these two opposingforces.
So what about the extremes then?The Dow.
The Dow was the undisputed star of the show, Rallied huge 530, 9
points up. That's one point, 1% getting
close to a new record high actually.
And that was broad based. Very broad cyclicals, value
stocks, the whole sort of old economy complex was celebrating.
(02:06):
And the flip side, the NASDAQ. That's where the pain was.
The NASDAQ Composite closed down.4%.
It led the losses for the day, really confirming where that
selling pressure was concentrated.
OK. So that kind of divergent
doesn't just happen. There have got to be two really
strong opposing stories driving this.
Let's tackle the good news first.
(02:27):
What was this Washington tailwind lifting the Dow?
It was basically a massive sigh of relief from Washington DC.
The main driver was news that the government shut down.
The longest ever 42 days is finally ending.
Finally. Yeah.
The Senate approved the deal late Monday.
The House vote is expected any minute now, and the president's
indicated he'll sign it. So it's pretty much a done deal.
(02:49):
OK, That removes a huge cloud ofuncertainty, stops the economic
leading from things like, you know, flight delays and whatnot.
But is the market maybe getting ahead of itself here, betting on
cyclicals before the data actually confirms things are OK?
That's a really sharp point. Yes, the market is
forward-looking. The relief isn't just about the
immediate disruptions ending, although that helps confidence.
(03:10):
The crucial bit for investors and the Fed is that the data
blackout ends. Key inflation reports,
employment numbers, We haven't had them.
The Feds been, as the source material puts it, flying blind.
OK, so getting that data back means the Fed can actually make
informed decisions, especially heading into that critical
December meeting. Exactly.
It restores some predictability.So the market's basically
(03:33):
betting that the US economy avoids this self afflicted wound
and that momentum is coming back.
So that sparks this big rotationinto the economically sensitive
stuff. Cyclicals value names you
mentioned healthcare industrialslit up.
Precisely. That's the resolution story in a
nutshell. OK, Now for the dark side, the
NASDAQ. Why did AI stocks get hit so
(03:54):
hard? You mentioned NVIDIA
specifically. What turned selling into actual
contagion? It was a nasty double whammy.
Really shook confidence in that whole AI valuation narrative.
First catalyst. Kind of a bolosha ring moment.
NVIDIA, the absolute poster child of the AI boom, dropped
3%. Why?
Because the Japanese tech giant SoftBank revealed they'd sold
(04:17):
their entire stake last month, We're talking $5.83 billion
worth. Wow, their entire stake from a
major player like SoftBank. Yeah, that signals massive
profit taking from someone very sophisticated.
It definitely spooked market, made people wonder if, you know,
maybe the peak is in or close. What?
Was the big signal. What was the second hit?
You said it was maybe more fundamental.
(04:39):
It came from a company called Core Weave, ticker CRWV.
They're an AI focused cloud provider and importantly, a huge
customer. Invidious chips, right?
They plunged over 14% today. They reported a delay in
building out a data center, which means they're going to
miss their Q4 earnings expectations.
Ouch. So that's the Canary in the coal
mine. Pretty much it's the first
(04:59):
really hard evidence that this spend it all costs frenzy on AI
infrastructure might be hitting,I don't know, logistical
hurdles, maybe financial limits.So you have one big investor
cashing out question to the valuation, and then a key
customer stumbling, questioning the actual pace of spending.
Why did that ripple out so widely?
Because the whole AI sector has been trading on this promise,
(05:21):
this assumption of just relentless spending growth.
The SoftBank news hit the valuation story, the core Weave
news hit the execution story, got her put them together, and
it sent shock waves right through the AI supply chain.
We saw other key AI infrastructure stocks, think
Micron, Oracle, Palantir, they all fell more than 2% just in
sympathy. That's your contagion.
(05:42):
OK, this tale of two tapes idea seems solid.
To really prove it though, we need to dig into the market
internals. Let's start with the VIX, the
fear gauge. Now wait a second.
Dow soaring, S&P slightly green.Surely the VIX went down.
You'd think so, wouldn't you? But no, the VIX actually closed
up .37 on the day, finishing at 17.97.
(06:04):
On a day like today. Exactly.
That's a major bearish divergent.
It's a huge red flag. What does that tell you?
It tells you that even though most of the market was feeling
pretty good, investors were actively, maybe even
frantically, buying downside protection.
Put options specifically on those big, heavily weighted tech
stocks. So the fear in NVIDIA and its
peers just overwhelmed the calm everywhere else.
(06:26):
Pretty much the demand for protection in that narrow
leadership group was intense enough to lift the whole VIX
index. It's statistically quite
significant when you see that kind of.
Split, OK, so VIX up is bearish divergent, what about market
breadth, the advanced decline line, did the average stock have
a better? Day.
Oh, absolutely. Breadth was incredibly strong.
(06:46):
Actually. Depending on the exact count,
somewhere between 72% and 75% ofall stocks in the S&P 500
finished positive. That's around 360 companies
gaining ground. Wow.
OK, so that confirms the theory perfectly.
The average stock did great, butthe S&P 500 index itself barely
moved because those few losing stocks, the big AI names, carry
(07:07):
such enormous weight. Textbook example of strong
breath being masked by weak leadership at the very top in
terms of market cap. But there's always a but, isn't
there? There's a wrinkle in that nice
breath story when we look deeper, right?
Talk about the new 52 week highsversus lows.
Yeah, this is where you see the underlying fragility.
Despite the Dow rally and the decent breath, we actually saw
(07:29):
172 stocks hit a new 52 week lowtoday.
A. 172 lows How many highs? Only 110 hitting a new 52 week
high. Oh, that's not good.
More lows than highs on a day the Dow surged over 500 points.
It's a major internal divergent and a really healthy broad
rally. You want to see new highs
(07:51):
swamping new lows. The fact that more stocks are
still breaking down suggests themarket's foundation isn't as
solid as the Dow might make you think.
The rally isn't lifting all boats.
Still some damage underneath. OK, let's follow.
The money sector performance should really paint the picture
of this rotation. Where do the cash actually flow
today? It's almost a perfect mirror
image of the Divergent 10 out ofthe 11 S&P sectors finished in
(08:13):
the green. Guess which one was red?
Has to be technology XLK. Bingo.
Technology was the only loser dragged down by that AI
contagion we talked about. The money flowed pretty much
everywhere else, specifically into old economy and what you
might call defensive value. So who are the big winners
sector wise? Healthcare really stood out.
(08:33):
It's kind of a defensive play, but also has value
characteristics right now. We saw strong moves in Merck up
4%, Amgen up over 3%, Johnson and Johnson up over 2%.
A defensive value? What?
Else, industrial surged. That's your pure cyclical bet on
the shutdown ending and economicactivity picking up.
And interestingly, even consumerstaples saw inflows.
(08:54):
Staples like soap and cereal companies, They've been dogs for
years. Exactly.
But today, investors were fleeing the high flying, high
risk tech names and looking for safety and just bare necessity
stocks. A real flight to perceived
safety, even into sectors that have underperformed for ages.
Fascinating rotation. OK, let's drill down to some
specific stock movers that were driven by News Today.
(09:15):
Paramount Skydance PSKY rocketedup 8.4% but didn't they miss on
earnings? They did their first report
since the merger. Missed on revenue, missed on
profit, but the market completely looked past the
rearview mirror. So why the huge jump?
It was all about the future. New management came out with a
really aggressive plan to cut costs.
(09:36):
They jacked up their synergy target to $3 billion.
So investors basically said OK, we ignore the past.
We're betting on this turn around story.
A pure forward-looking bet. Got it, Turn around play.
Then there was FedEx FDX, up 6%.That sounds like a macro story.
Absolutely. FedEx is a classic economic
bellwether, right? They actually increase their
(09:56):
profit forecast for the holiday season.
Oh. Really.
Despite everything. Yep, and that was seen as a huge
vote of confidence in the US consumer, in the economy
bouncing back, tying directly into that optimism about the
shutdown ending. Perfect link.
And on the losing side, we have to mention NVIDIA again down 3%.
Just to recap that SoftBank exit, the core weave contagion,
(10:16):
it really hit the narrative hard.
It really did. I think for the first time,
investors are seriously asking questions about just how
sustainable that breakneck pace of AI infrastructure spending
really is. Is there a limit?
Are we hitting it? Big questions.
Now we need to zoom out. Today was veteran's day, which
had a massive impact on the broader market context, didn't
(10:38):
it? What happened across other
assets? Yeah, this is maybe the most
critical piece of context for today's equity move because it
was Veteran's Day, the US bond market was completely closed.
Right, no bond trading at all. None, which means this entire
violent rotation we just described, Dow up, NASDAQ down,
value over growth. It all happened in what you
could call a ghost market. Yeah, it happened without the
(11:01):
bond market getting its vote. The bond markets vote on
inflation, on growth expectations.
Exactly. So tomorrow when the cash bond
market reopens, that is going tobe the real test of whether
today's equity rally, especiallyin cyclicals, has legs.
Huge point. OK, so bonds closed.
What about the US dollar? The dollar index, the DXY, it
actually pulled back about 1/4 percent, down to around 99.38.
(11:25):
Which makes sense. If it's risk on the shutdown,
resolution removed one key reason to hold the dollar as a
safe haven, so investors felt comfortable selling the dollar
and moving into riskier cyclicalassets elsewhere.
Classic risk on move. OK, but then gold was also up
close around $4138.00 an ounce. That seems a bit contradictory.
(11:46):
Selling the safe haven dollar but buying safe haven gold.
It perfectly highlights the split personality of the day.
Yes, gold got a mechanical lift from the weaker dollar.
That's part of it, sure. But more importantly, I think
investors were buying gold as a hedge.
A hedge against what? Against a potential tech LED
market correction given those cracks we just saw in NVIDIA and
the AI leaders. So they're participating in the
(12:08):
cyclical rally, but hedging their bets with gold in case
tech really rolls over. Hedging the euphoria makes
sense. And finally, crude oil WTI was
up nicely. Yeah, WTI crude surged about
1.6% back over $61.00 a barrel. This is probably the purest
shutdown ending trade you could find today.
Well, crude prices have been weak on worries about
oversupply. Today's jump basically reverses
(12:29):
that. It's a direct bet that with the
US government back online, economic activity will pick up
and demand for energy will rebound.
Pure growth optimism. OK, so today really sets the
stage for a critical next 24 hours.
What do we need to watch tonightand tomorrow to see if this
rotation sticks? Tonight after the bell, the big
one for tech traders is the AMD Financial Analyst Day.
(12:51):
Talk about timing. Right after NVIDIA gets
hammered. Exactly.
All eyes will be on AMD, Nvidia's chief competitor.
Can they steal the narrative? What do they say about AI
spending? Their commentary is going to set
the tone for tech tomorrow, no question.
We also get earnings from Alcon,Amdocs and Haileen tonight.
OK, AMD is key tonight. What about the docket for
(13:13):
Wednesday? Sounds like it could be massive
now that the shutdown's over. It's huge, sort of a triple
threat. First, as we said, the bond
market reopens, we get a 10 yearnote auction to that's the acid
test for today's rally. Test #1 Bonds.
Test #2 the Fed. We get a whole parade of Fed
speakers. Williams, Waller, Bostic,
Collins It's their first real chance to react publicly to the
(13:35):
shutdown ending and the new fiscal picture.
What do they signal? Test #2 fed reaction.
And test #3 more tech earnings. Crucially, another semiconductor
firm, Global Foundries GFS, reports before the market opens,
along with Transdime TDG. Will GFS confirm the core weave
weakness or push back against it?
(13:56):
You also mentioned oil data. Yeah, the OPEC monthly report
and the usual API a inventory data will tell us if today's
crude rally was just a one off or if there's something more
sustainable. There.
OK. So pulling this all together
after a really turbulent day, what does this mean for you, the
investor looking your portfolio tonight?
Well, I think the main take awayis that this wasn't just noise.
(14:17):
This was a high volume, pretty violent rotation.
It really felt like it could be a passing of the baton from that
magnificent 7 AI driven trade, which let's face it, some
strategist think is looking pretty late stage over to the
more traditional old economy, blue chips, healthcare, maybe
even staples, the stuff that's been left behind.
(14:37):
So the big question everyone needs to ask themselves tonight
is pretty simple, isn't it? I think so.
Was today just a one day head fake, you know, driven by relief
about the shutdown? Or is this the start of the real
great rotation that value investors have been waiting and
waiting for? And the answer depends on.
The answer really lies with those bond traders tomorrow
(14:58):
morning and what that parade of Fed speakers tells us.
Their collective vote is likely going to dictate market
direction for, well, probably the rest of the quarter.
What a fascinating setup. Thanks for walking us through
that incredible market divergenttoday, connecting all those dots
between the headlines, the internals and the class asset
moves. Really appreciate you joining us
for this deep dive.
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