Rise and shine everyone.

It’s a quiet morning, after the surge in equities post-Jackson Hole. Small caps continue to lead equity futures in the US this morning, as Fed cuts are confirmed. We would still prefer Small Cap Value (ETF: IWN) to small caps overall though.

The focus this morning is Crude Oil, after escalations in the Middle East. There have also been some reports of increased attacks between Ukraine and Russia. Libya is reported closing some of their oil fields.

The US Dollar index is still below 101 but showing some signs of life against major currency pairs. After hitting an 8-month low on Friday.

The Yield Curve is steepening as traders price in cuts at the short end. However, long-end yields are also rising.

German Ifo Business Climate index came in marginally lower than last month at 86.6 but above consensus. However, the Ifo president expressed serious concerns stating “The German Economy is increasingly entering a crisis.”

The major focus for this week will be NVDA earnings even though we have PCE numbers on Friday. No one is focused on inflation anymore given that the Fed has now shifted focus to the labor market and no longer sees upside risks to inflation.

Over the last few weeks, the pull back in Mega Cap tech still has not reversed completely. If NVDA delivers solid earnings…. and guidance, we could be looking at ATHs yet again for the indices.

Chart of the Day

ETFs are still preferred by retail / individual investors.

Calendars

(news taken from Reuters, FT, Bloomberg; Calendar from Trading Economics)