Yesterday was a big day for geopolitical pundits and history buffs, but financial markets didn’t do much in the wake of the Trump-Zelensky-EU meetings. Equities traded in a very tight range, <20 points for the S&P 500, which ended flat. We’re seeing a bit more activity in the markets today, especially as we move past noon, with readily apparent performance divergence. The S&P 500 and the Russell 2000 are down ~0.5% but the S&P equal-weight is up 0.3%. Tech and mega-caps are under pressure- Comm Services, Info Tech sectors and the NYSE FANG+ index are down >1%. Major AI names are trading lower. Growth ETFs are down >1% across market caps as is Momentum. Crypto equities are under significant pressure across-the-board, from Treasury companies to service providers. Rare earth miners are also down sharply. Looking at the Top and Bottom performers across the S&P, there’s definitely a rotation today from YTD winners to laggards. On the positive side, the Dow Transportation Index is outperforming with freight and rail names strong. Relatedly, Real Estate is the best-performing sector helped by warehouse and logistics REIT Prologis catching an upgrade. Consumer Staples is among the leaders as we head into earnings from major retailers this week. Healthcare is outperforming. Most commodities are lower. ICE Brent is down 1%, trying to hold its 100d ma amidst the Ukraine peace talks. US nat gas is down 5%. Gold is modestly lower, clinging to its 50d ma. Copper is down as much of the Ag sector. Bitcoin and Ether are extending losses, now down 3-4%. Treasury yields are down 2-3bp across the curve, at their lowest levels on the day. As we get closer to the Jackson Hole conference and Powell’s speech, Fed rate cut expectations for the September meeting have come in modestly since their recent peak, from ~95% to 85% currently. The US Dollar Index is up slightly.

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