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Samantha’s Live Trading Room Summary - 1/24/25
Consensus: Risk assets rally harder. I will detail the bullish arguments in a weekend market thoughts. I reviewed a few themes premarket from the Goldman Tactical Flow-of-Funds: February Preview h/t Rubner. But point is, market continues to point higher while the breadth destruction from early December gets repaired. Believe it or not, the price action is WAY AHEAD of the fundamentals. You are shocked, I’m sure ;-)
BOJ hiked! As expected. And only 25bp, which was priced in, which is why nothing happened - even thought they talked hawkish (no 50bp ceiling). For now, risk assets were safe with the dovish hike. And yet… falling US dollar, yields and oil was not enough to bid up markets even more. The buyers are exhausted on this low-volume Friday - ahead of next week’s PCE, FOMC and some fave MAG7 earnings.
RSP:SPY is a graphical depiction of the concentration risk in cap-weighted SPX MAG7 versus ‘value’ or equal-weight. So given this is well below covid-lows, the question is whether market will melt-up BECAUSE of a catch-up trade or in spite of it.
