Morning Note: Not So Fast On That New Bull Market Call, And Your Weekly Sector, Region and Asset Class Results Update

If you've been tracking our weekly results updates you've noticed, of late, a growing shade of red... As we've maintained since the October '22 bottom, macro dynamics have remained such that a next leg down carries odds too high to ignore.

Now, many on Wall Street have taken the stance that the bear market is over and done, and that a new bull market is just getting underway.

Well, okay, but I struggle with calling a new bull market when, for example, the S&P 500 Equal Weight Index is down 12% from its this-July peak, and sits a mere 8% above the last October low, while still down 17% since the all time high back in January of 2022:

And if you find that uninspiring, the Russell 2000 (typically the way-leader at the beginning of new bull markets [and, make no mistake, we'll be buyers when the time comes]) is still down a whopping 31% since the Jan '22 peak: 

Now, granted, the S&P 500 Cap-Weighted Index still sits at an impressive 18% above the last-October low, but, nevertheless, it's 8% off the this-July high, and still 12% below the Jan '22 all-time-high:

So, suffice to say that, if a new bull market has indeed begun, I suspect that its first year performance is the very worst on record.

I.e., it's every bit as (if not more) likely that what we just experienced (through July), when it's all said and done, turns out to be nothing more than a, albeit long, bear market rally.

So what explains the divergence between the S&P 500 Equal and Cap-Weighted Indexes? Regular readers know the answer, it's the cap-weighted's epic concentration in what they're now calling the Magnificent 7.

Here's Jim Bianco updating the numbers:

Stay tuned...

Here's your weekly sector, region and asset class results update:

Asian stocks got hammered again overnight, with 15 of the16 markets we track closing lower.

Europe's struggling as well so far this morning, with 16 of the 19 bourses we follow trading down as I type.

US equity averages are lower to start the session: Dow by 91 points (0.0.27%), SP500 down 0.21%, SP500 Equal Weight down 0.34%, Nasdaq 100 down 0.10%, Nasdaq Comp down 0.11%, Russell 2000 down 0.28%.

As for Friday’s session, US equity averages traded lower: Dow by 0.9%, SP500 down 1.3%, SP500 Equal Weight down 1.6%, Nasdaq 100 down 1.5%, Nasdaq Comp down 1.5%, Russell 2000 down 1.3%.

This morning the VIX sits at 21.03.

Oil futures are down 0.86%, nat gas futures are down 0.06%, gold's down 0.24%, silver's down 0.90%, copper futures are up 0.22% and the ag complex (DBA) is up 0.25%.

The 10-year treasury is up (yield down) and the dollar is down 0.22%.

Among our 33 core positions (excluding options hedges, cash and money market funds), 9 -- led by TLT (long-term treasuries), FEZ (Eurozone equities), XLC (communication stocks), LEMB (emerging mkt bonds) and DBA (ag futures) -- are in the green so far this morning... The losers are being led lower by Dutch Bros, REMX (rare earth miners), AT&T, XLE (base metals miners) and XLE (energy stocks).

 “American history carefully examined is a story of ups and downs in civic engagement, not just downs—a story of collapse and renewal” (his italics).  --Robert Putnam

Have a great day!
Marty