Market sentiment hinges on Fed's message tomorrow for Santa Claus rally.
Sam
Nathan Peterson
Market shifted from September's everything rally to selective, yield-focused environment heading into Q1.
Nathan Peterson
Expects 25bp Fed cut but sees risk of hawkish guidance, surprised by high cut probabilities.
Nathan Peterson
BOJ meeting next week important; JGB yield rise pulling US yields higher.
Nathan Peterson
Market stalled within 1% of highs, waiting on Fed; bullish seasonality present but not guaranteed.
Highlights BOJ/Fed policy divergence risk (carry trade unwind) and its potential impact on AI stocks.
Sam
Nathan Peterson
Technicals show recovery above 50-day SMA, resistance at prior highs (~2% away), support at 50-day SMA.
Nathan Peterson
Technically needs new high for Santa Claus rally; hawkish Fed causing yields to rise could reverse markets.
Nathan Peterson
Yields critical for equity risk premium (S&P forward PE ~23) and for scrutinizing mega-cap tech capex spend.