Friendly reflation and market broadening (with Tom, Lizzy)

Christian Mueller-Glissmann views the KOSPI sell-off as a healthy consolidation driven by earnings, not just momentum. He discusses the potential for market broadening if the Strait of Hormuz reopens, and warns that a strong payrolls number could lead to rates pressure and the market giving up on Fed cuts. He sees 5% on the 10-year as a problematic level for equities.

Yields up , medium term, interviewee explicit

explicit

NDX cautious up , short term, interviewee implicit

implicit

RUT up

Oil volatile , short term, interviewee implicit

implicit

Metals

USD

Goldman Sachs 9.0
Investment Bank $2500.00B
Christian Mueller-Glissmann 9.0

Friendly reflation and market broadening (with Tom, Lizzy)

ndx

He sees the sell-off as a healthy consolidation and is still constructive on tech, but warns about cyclical risks in semiconductors.

rut

He discusses market broadening and a snapback in low volatility stocks (bond proxies), which could include small caps if rates relief occurs.

wti

He discusses the impact of the Strait of Hormuz on oil prices and the potential for a reopening to provide rates relief, implying volatility in oil prices.

yields

If you get into a reflation in the US... I think the upward pressure on long-dated yields will continue.

27 calls

-2

no reliable edge (random outcomes)

5/28/2026 8:01:54 PM	short term cautious up	5 days later	+0.85%	+0.43%
5/6/2026 9:19:41 AM	short term cautious up	5 days later	+1.62%	+0.81%
5/5/2026 1:43:30 AM	short term cautious up	5 days later	+1.24%	+0.62%
4/20/2026 7:09:00 AM	medium term up	20 days later	+2.75%	+2.75%
3/4/2026 2:04:00 PM	short term up	5 days later	-0.24%	-0.24%
2/12/2026 6:36:08 PM	medium term cautious down	20 days later	+2.22%	-1.11%
1/30/2026 6:19:23 AM	medium term cautious down	21 days later	-5.75%	+2.88%
12/9/2025 6:20:53 PM	medium term cautious down	20 days later	-0.82%	+0.41%
11/28/2025 6:04:11 PM	medium term down	21 days later	+1.78%	-1.78%
11/13/2025 8:45:53 PM	short term down	5 days later	-0.36%	+0.36%
11/7/2025 7:28:39 PM	medium term cautious down	21 days later	-0.34%	+0.17%
10/29/2025 5:37:32 PM	medium term cautious down	20 days later	+0.98%	-0.49%
10/28/2025 6:42:40 PM	medium term cautious down	20 days later	+1.60%	-0.80%
10/28/2025 1:59:32 PM	short term cautious down	5 days later	+1.18%	-0.59%
10/24/2025 6:55:30 PM	medium term cautious down	21 days later	+3.40%	-1.70%
10/15/2025 9:58:39 AM	medium term cautious down	20 days later	+4.55%	-2.28%
10/7/2025 1:51:58 PM	short term up	5 days later	-1.89%	-1.89%
9/29/2025 2:12:26 PM	short term cautious down	6 days later	+0.34%	-0.17%
9/16/2025 4:19:00 PM	medium term cautious down	20 days later	+1.25%	-0.63%
9/11/2025 1:30:06 AM	short term cautious down	5 days later	+0.37%	-0.18%
9/9/2025 10:35:22 PM	short term cautious down	5 days later	+0.05%	-0.02%
9/5/2025 6:25:27 PM	medium term cautious down	21 days later	+2.35%	-1.17%
9/3/2025 7:20:32 PM	short term cautious down	5 days later	-2.44%	+1.22%
9/2/2025 1:47:03 PM	short term sharp up	5 days later	-3.92%	-5.88%
8/12/2025 11:12:01 PM	short term cautious down	5 days later	+2.43%	-1.22%
8/6/2025 7:05:41 PM	medium term cautious down	20 days later	-0.14%	+0.07%
8/1/2025 6:12:49 PM	short term down	7 days later	+1.74%	-1.74%

Show all 27 yields results

Asks if the KOSPI sell-off is a healthy consolidation or a structural shift in sentiment.

Tom
Christian Mueller-Glissmann

The KOSPI rally was driven by earnings (320% growth), making it more fundamentally healthy than typical momentum rallies. The sell-off is a healthy consolidation to flush out leverage.

There's a lot of speculative positioning that has built up, leverage ETFs, all kinds of options positioning. Broadcom results made people rethink how to extrapolate those earnings because it's a very cyclical industry.
Asks if semiconductors remain cyclical.

Tom
Christian Mueller-Glissmann

Semiconductors are still a very high operational leverage, cyclical industry, even if the AI capex boom is structural for multiple years.
Asks if the end of the Iran war could knock AI leadership and bring investors back to EM and Europe.

Lizzy
Christian Mueller-Glissmann

A reopening of the Strait of Hormuz would provide rates relief and drive a broadening out of the market. Low volatility stocks (bond proxies) have done the worst and could snap back.

There is a divergence between growth optimism in the US (boosted by AI capex) and rates relief not happening. If you get rates relief, you could get a bit of a broadening out.
Asks if a strong payrolls number is good for equities and bad for rates.

Lizzy
Christian Mueller-Glissmann

A strong payrolls number would create a difficult spot for the Fed, potentially forcing them to talk about hikes. This could lead to rates pressure feeding back into equities. Not too hot, not too cold is best.

The US has looked a bit reflationary, but core inflation has remained anchored, so it looks like a friendly reflation. If payrolls are too strong, the market will completely give up on any Fed cuts.
Asks what level of yields becomes a problem for equities.

Tom
Christian Mueller-Glissmann

Historically, 5% on the 10-year is a difficult level for equities to digest. Speed and source also matter; if driven by inflation, it's problematic; if by a stronger labor market, it's less so.

The real trend growth of the US economy is probably around 2-2.5% plus 2.5% inflation. Above 5%, rates might be too restrictive on the back end.
Asks if a strong labor market is the most likely factor to get us to 5% on the 10-year.

Tom
Christian Mueller-Glissmann

If the US enters a reflation where manufacturing, labor market, and AI capex are strong, upward pressure on long-dated yields will continue. An unfriendly narrative could come from core inflation picking up if the Strait doesn't reopen.

If the Strait of Hormuz doesn't reopen by the summer, it starts to feed into fertilizer prices, impacting farmer planting in October, and food inflation might be higher next year, feeding into wage inflation.
Asks what the bigger risk to equities is: earnings disappointing or a bond sell-off.

Lizzy
Christian Mueller-Glissmann

Earnings disappointing is the bigger risk. The rally has been earnings-driven, so the biggest threat is the market doubting those earnings. Some drivers of earnings are cyclical and could normalize.

Earnings in Asia have been upgraded 50-60%, in the S&P 20%, even in Europe 10% helped by energy. You always need to worry for those earnings to normalize.
Asks about his conviction around European stocks if the Strait reopens.

Tom
Christian Mueller-Glissmann

Europe has been the biggest loser from the Middle East war. A reopening would provide significant relief, especially rates relief, as the ECB is one of the few central banks clearly going towards hikes.

If you take those hikes off the table and open the door for cuts, it would really help the market fade those ECB hikes.

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