Inside Markets

Listen to our Managing Partner and CFA, Andrew Graham, answer questions we've been receiving from clients at Jackson Square Capital. We're answering questions regarding bond yields, high unrealized gains, and AI. Would you like to learn more about Jackson Square Capital or receive our daily market newsletter? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Listen to Jackson Square Capital's CFA and Managing Partner, Andrew Graham, answer questions relating to his market outlook for the year. Would you like to learn more about Jackson Square Capital or receive our daily market newsletter? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Monetary easing and disinflation remain as the dominant bullish equity themes. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

We expect earnings to be the main driver behind this week's price action. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Many earnings driver outperformers and downside reports were released yesterday and today. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The logic behind pricing in a March rate cut originally came from Fed officials' repeated emphasis on the annualized 6-month run rate core PCE. That measure should fall below the Fed's 2% inflation target prior to the March meeting. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Real yields will likely decline from current levels but remain at highly restrictive levels unless something breaks. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Ten-year Treasury yields look like they'll top out near 4.25% as markets price for Fed policy normalization to begin this summer. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

January is a volatile month for inflation data as many labor and supplier contracts are rest at the new year. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

March rate cut expectations are repricing to lower levels which is putting upside pressure on short-dated bond yields.   Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Pricing of a March rate cut will likely be challenged in coming weeks. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The SPX and RTY could signal an imminent cyclical recovery. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Consensus is looking for December headline CPI to come in at +0.2% MoM, up from +0.1% in November as the recent decline in energy prices is now behind us. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Consensus is looking for a headline reading of +0.2% MoM or +3.2% YoY, but what are the results in other prints? Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

A pullback in rate cut expectations remains the single biggest risk to equity markets.   Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The SPX is currently trading below levels that signal a short-term reversal. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Tomorrow's Jobs Report has the potential to be an important near-term macro catalyst for markets given the recent back up in yields.   Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The three-day pullback in the S&P 500 (SPX) and Russell 2000 (RTY) comes as both benchmarks approach broad range resistance.   Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The SPX is approaching technical range resistance where we expect the index to decelerate and possible bearishly reverse. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Tomorrow brings November core PCE and final Michigan consumer confidence with inflation expectations. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com. The cyclically-sensitive Russell 2000 (RTY) is trading to the upper end of range resistance near 2015.

November core PCE inflation due Friday is the only catalyst with enough weight to shift the current narrative. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Major US equity indices are overbought and due for a period of consolidation. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Yesterday's updated Summary of Economic Projections clearly supports market expectations for a soft landing, especially when compared to the SEP from last December. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The updated dot plot will likely attract the most attention when the Fed releases its Summary of Economic Projections today. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The bond market is telling us that hawkish rhetoric should be ignored given the Fed's dual mandate of price stability and maximum employment. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The SPX is technically overbought, positioning is no longer a tailwind and bullish sentiment is now elevated. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Higher bond yields by themselves shouldn't create a near-term headwind for equity markets, but higher bond volatility would.

Labor market dad should become a bigger input for Fed policy expectations going forward. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

A dominant recession narrative is unlikely to have equity-friendly implications. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Market based probability for rate cuts to begin in March is inconsistent with the prevailing soft-landing narrative.

The rotation out of mega-cap Tech and into YTD underperformers will likely continue for the next couple of weeks. In index terms, this would favor the Russell 2000 (RTY) over the Nasdaq 100 (NDX).

Momentum reversal at year-end, known as the January Effect, is one of the most consistent patterns in Equity Markets. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Without preemptive rate cuts, the Fed's commitment to higher for longer rates will eventually lead to large scale layoffs. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Yesterday's dovish Fed comments, small uptick in consumer confidence and better-than-feared early holiday shopping trends has started early rotation into cyclical equity groups like banks, REITS, autos and housing.

The prevailing soft landing narrative includes expectations for 100bp of rate cuts in '24. The presumed rate cuts have been driving recent dollar weakness and gold strength.

A US soft-landing in 2024 is the prevailing narrative with risks skewed toward a potential recession.

Inside Markets will not be published for the rest of the week. The next edition will be published Monday, November 27. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

This afternoon's earnings report from NVDA will have near-term implications for semis, mega-cap Tech and the broader market.

The SPX advanced +2.2% last week, while the NDX gained 2.0% and Russell 2000 (RTY) +5.4%. The cooler inflation print increased conviction that the Fed is done with its hiking cycle.

Equity markets are in the middle of a strong seasonal period when upside often results in performance chasing into year-end. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The 'bad news is good' phase likely remains intact as disappointing data drives bond yields lower and should drive stock prices higher. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Yesterday's cooler CPI combined with the October Jobs report give reason to conclude the hiking cycle is now done. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The 4% YoY core CPI rate remains 2x higher than the Fed's target. Today's dip in the core rate likely means that rate hikes are over, but policy could remain restrictive until the 2% target is within range or until something breaks.   Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The Fed will likely wait for three consecutive months of lower YOY headline CPI prints before officially calling an end to the hiking cycle. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

We expect 10-year yields to remain above our 4.48% bullish inflection target for the remainder of Q4. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

The market has entered a brief catalyst vacuum ahead of next week's CPI and retail sales reports. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

A confirmed peak in bonds yields should be an equity friendly development. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Last week, the S&P 500 (SPX) gained +5.9% as a lower-than expected Treasury refunding announcement, dovish Fed and disappointing data triggered a pullback in bond yields. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

Disappointing macro data and a coincident decline in bond yields has driven equity upside this week, but investors will eventually need to consider the growth implications. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.

AAPL results this afternoon could also have macro implications given the setup. Would you like to learn more about Jackson Square Capital or receive Inside Markets as a daily email? Join the Jackson Square Capital community by sending an email to hello@jacksonsquarecap.com.