Dead Cat Bounce

The market is no longer reacting positively to signs of slowing growth—bad news is simply bad news. Last Friday, a weaker-than-expected employment report led to a significant market correction, while the following week, a stronger-than-expected service sector report and weaker than expected jobless claims sparked a strong rally. However, unless the Fed signals rate cuts for September, this rally may be short-lived.

The 4 key events to watch

1. Inflation report on Wednesday (Aug 14th)
2. The Jackson Hole symposium (Aug 21)
3. Nvidia's earnings (Aug 23)
4. GDP (Aug 29th)

A full market recovery will require a cooling inflation report, strong guidance from Nvidia, and clear communication from Fed members about a potential rate cut in September. If all three align, the market could work its way back to the upper range, though it may face some challenges from the uncertainty surrounding the election and geopolitics.

Seasonally, October is the bear market killer.

Recession Trade - $TLT

Stocks will face challenges if economic growth continues to weaken, but this situation is ideal for long-term bonds. These bonds have already gained momentum and serve as a strong hedge against a recession.

There's a Bull Market somewhere

look for individual stocks within these sectors.

• Utilities are being fueled by data center spending from the hyperscalers.
• Financials, real estate and industrials are being fueled by much lower borrowing rates. Lower rates are fueling mortgage demand, industrial production and construction spending.
• Healthcare is defensive and under owned