Congratulations to the Seattle Seahawks and their fans on extracting revenge with a dominant defensive performance in their Super Bowl victory last night. There was a little bit of the Super Bowl flu going around my train station this morning, but not quite an epidemic. Definitely a little lighter than normal though.

On Friday the Dow Jones Industrial Average closed above 50k for the first time. Hats were passed around on the Trading Floor. The S&P 400/600 also hit new all-time highs, ending the week up ~4% with a mix of cyclical and defensive sectors outperforming. However, the S&P 500 ended the week slightly lower with mega-cap tech, software and the crypto complex under pressure before a broad snap-back rally on Friday as the potential of AI-displacing software remains an overhang across the group.

Coming off the Super Bowl hangover and Friday’s rally, the S&P 500 opened slightly lower and moved back down to its 50d ma before bouncing to its highs of the day, where we are now. The Russell is actually outperforming while the 600 is about unchanged as is the equal-weight. High-beta groups are seeing sold gains- neo datacenters, nuclear/uranium, etc. Mega Cap Growth is strong with Semis/Tech pushing higher, but software is the standout as the IGV ETF adds 3% to Friday’s 3.5% gain. Defensive sectors are lagging with the counter-rotation/relief rally continuing. On the downside are Staples and Healthcare, with the latter seeing some sharp moves lower on earnings and pharma weakness.

Chinese regulators reportedly told financial institutions to pare holdings of US Treasuries. 10/30 yr yields were up 3-4bps but are now around flat. Rates pulled back as Senior Economic Adviser Kevin Hassett spoke to the media and seemed to be lowering the bar for upcoming labor data. The Dollar is weaker on the major crosses, including the yen despite the election results. The USD index is back below 97.