AI hardware bounced and energy stalled, but the bounce has not yet lasted a week
For holders of quality equities, the day brought short-lived relief to battered capital-spending suppliers and lower long yields, but it gave no durable reason to rotate out of cash-generative businesses.
Stocks bounced broadly: 8 of 12 sectors rose, led by Technology at 2.09%, and the biggest gains came in AI hardware such as LITE and CIEN. Most of those gains are graded tape, because the five-session moves are still negative.
Since the last briefing
On Friday we said energy alone was holding up and extended our margin markdowns to AI hardware suppliers whose cash flow depends on capital spending holding up.
What drove the session and how it transmitted, the exposure table by persistence grade, where the committee disagreed, its verdict and weighting, and the falsifiers that would prove it wrong.