Republic Risk: Beware of Shiny Objects (Higher for Longer)

Equity Storm Watch Is YELLOW on the S&P 500 and YELLOW on the Russell 2000

The jobs report … adding 300,000 new positions is massive.

But where was the job growth?

Leisure and hospitality… GOVERNMENT… and healthcare.

Payroll ran a bit high, but this is another second-job and government jobs report. You’ll hear many people suggesting that the market is “Cheering” on this report. I would say that we’re seeing some short-covering. Interest rates are going up. The 10-year is pushed toward 4.38%. 

I will note that the utility sector is currently negative, typically a barometer of future interest rate movements. Also, Bitcoin is still dropping (a new source of liquidity for funds), oil is rising, and the Russell is DOWN 1% to start the day.

Technology and consumer cyclicals are also under pressure. This doesn’t mean there aren’t things to buy in this environment—and the market could easily see a 1% move higher today from the S&P 500 just because it’s Friday. It should be wild. So, prepare your…