Putting the Stock Market Sell-Off Into Perspective

Jeff Buchbinder (00:00):

<Silence> Hello everyone and welcome to LPL Market Signals. Jeff Buchbinder here with my friend and colleague, Kristian Kerr. Kristian, I started the week recovering from taking my teenage daughter to the Sabrina Carpenter Concert, okay. in New York City. I recovered from that, then I got sick, and then the market started selling off. So now I am continuing my recovery. It's been a very long week. How are you <laugh>?

Kristin Kerr (00:31):

Better than you it sounds. I have not. I did not go to the Sabrina Carpenter concert, so I'm in better health than you are right now.

Jeff Buchbinder (00:41):

You started the week strong and you had enough in the tank to get through this market volatility this week. I was not so fortunate. Yeah. So I got a little bit of a cold, but I'll fight through it. The certainly main topic, I think really for the whole week but definitely here over the last couple of days is the sell-off in tech. So we'll get Kristian's thoughts on that. It's not just tech though, because you had some layoff announcements that I think caused the market to question whether the job market's going to hold up or not. So you layer that on top of the government shutdown, on top of the credit fears that we've talked about over the past several weeks, and it looks like it was just a little too much for the market to handle.

Jeff Buchbinder (01:33):

So getting a little bit of a sell-off here that we will dissect and then also preview the Weekly Market Commentary done by our chief economist, Jeffrey Roach, and he attempts to put the AI investment in context in the context of the overall economy. We'll just show you one chart from that commentary. It's it isn't out yet as we're recording this anyway, it's Friday November 7, 2025. We are recording early because I will be out on vacation early next week, continuing my recovery from this past week, <laugh>. So anyway, we'll give you some quick highlights on the WMC which you can find on the lpl.com website under Research. And then we'll close, like we have the last few times with a week ahead that has uncertainty in the calendar, right? We don't know if we're going to get government data or not next week. Probably not.

Jeff Buchbinder (02:31):

Alright, so market recap. I mean, you could argue that I didn't put enough on here, but AI valuation reset and layoffs, I think is probably enough to describe most of the decline. This is a five day look that includes the previous Friday and does not include this past Friday. So as we're recording this, we're down about two and a half on the S&P. The overall pullback is not even 3.5% right now, so pretty mild, although it's still the biggest pullback we've had in five months. I believe it was June when we last saw a pullback of even three. And you've got to go back farther Kristian to get a pullback of more than five. So just put the week in perspective here. What do you think are the main drivers and what do you look at that might give you some confidence that we'll be able to get our footing here soon?

Kristin Kerr (03:34):

Yeah, I mean, I think the clear thing is there hasn't been necessarily one thing you can point at to say that's what's driving this correction. So I think it's a mix of different factors, you know, some of the things you highlighted. I mean, honestly, I think the Fed last week, you know, the market started to get a little bit you know, more defensive post the Fed, right? Where they kind of, you know, threw a little bit of cold water on there being a cut next month, you know, still probably think there will be one, but just the chances of that. But I think since then we've kind of seen this kind of more negative price action in the markets. I think that's definitely part of the story. But then to your point, you know, we got those challenge or layoff numbers yesterday and clearly had a little bit of an impact on the market as well.

Kristin Kerr (04:20):

So I think we're kind of, you know, we've got a lot of this macro, minor macro headwind I think is really what's driving things here and the fact that, you know, we were just quite frankly, very overbought. And you know, I think that was a fairly decent recipe to kind of get the pullback that we've seen. You know, I think we're at a pretty, you know, in the broad index, you know, at certain levels, I guess in the broad index that, you know, where you would expect the market to try to turn back up, you know, starting to see it maybe happen here this afternoon. But you know, that's kind of the way I'm seeing it. Just not really any one thing I can put the blame on for this other than just over a little bit of an overbought market with, you know, a few negative headlines between the Fed and some other things that have put a little of pressure on the indexes.

Jeff Buchbinder (05:12):

Yeah, I mean, we've expected a pullback as many have for a couple of months now. It just didn't come when we would've expected it to. The seasonally weak period of September and October was a logical time for it to come, and it did not. So I guess it's coming now. It's coming in, it's coming in November, but it's you know, a little bit later I think, than we thought. So the other thing to keep in mind is if you're trying to sidestep a pullback, in most cases, you know, you'll probably end up buying higher than you sold, because you might predict a five percenter and get it but by the time you get it, you might go up five, down five and you end up no better than if you had just held. So it's really tricky, really difficult to sidestep these minor pullbacks.

Jeff Buchbinder (06:04):

What we try to spend our time doing is figuring out if we're going to get down 10 or 20 and right now we don't see that. So turning to the bond market I mean, I guess you could say it's a silver lining that the bond market has behaved actually better than behaved. It's been strong certainly for the past few months. And the slowdown in the job market, Kristian, actually helps the bond market, right? And it helps inflation, even though we're not getting inflation data, I don't think people are worried about inflation anymore. I think people are just worried about the growth picture.

Kristin Kerr (06:36):

Yeah, I mean, listen, I look at the bond market right now, and it just, you know, you have to squint to see anything really going on, right? I mean, it hasn't, it's been in this protracted range for a long time. So we, you know, if you look at it from a technical lens, yes, we did kind of challenge the 50-day moving average to the upside this week. That kind of failed. But we're really not going anywhere. We've been kind of in the lower end of a range for the last, you know, few months. So, you know, it's tough to really kind of say anything significant is happening in there. I mean, I think the bond market probably took what happened with the Fed last week and is saying, okay, you know, we'll price that out a little bit, but we're still baking in a cut, right?

Kristin Kerr (07:17):

So we're not really seeing any real you know, material price action in bonds, which I think, you know, ultimately is helping kind of stocks not really sell-off too aggressively. You know, if you were to see kind of a bigger move, higher in rates that might have been kind of putting a little bit more cold water on kind of this equity narrative. You know, I think also too, you know, the government shutdown is probably playing another role in kind of what's going on, at least in kind of in the funding markets. And we've talked a little about that, but just this idea that you've got a look, you've got kind of liquidity diminishing system wide. You know, we've kind of seen some odd things going on in kind of the repo markets.

Kristin Kerr (08:00):

You know, and I think if we were to get kind of a headline saying, you know, the shutdown's over you know, that's going to reintroduce liquidity, might even be a catalyst for pro risk. You know, obviously like the shutdown hasn't been a big market driver. It's been kind of happening in the margins, kind of in these funding markets where you could say there's been an impact. But generally speaking, when you get kind of liquidity diminishing, you know, it's, you know, rising tide lifts all ships. It kind of, you know, it doesn't help the equity story when you have that happening. So I think that's kind of the big takeaway for me is if we do kind of see any headlines, which I think we probably will, because I don't think either side wants to be going into Thanksgiving with the government still shut down just given the travel issues that could cause you know, you got to assume they're going to come to the table at some point. So that's a potential positive catalyst, quite frankly. But that's kind of the way I'm thinking about it right now. Just not a whole lot going on from a technical perspective, where I start first when looking at these things and you know, it's going to take something you know, from a headline perspective to really, I think, move things one way or another.

Jeff Buchbinder (09:09):

Yeah. And for those thinking that the refunds of illegal tariffs might cause the bond market to sell-off, you're going to have to wait a while. Yeah. Even though the hearing just happened, they're going to have deliberations for a while. We might not get a decision until next year. So at that time, could the bond market sell off a little bit on less tariff revenue to the treasury? Maybe, but that will be temporary because the Trump administration is going to shift. They're going to add new legal basis for tariffs. They're going to slap them right back on. There'll be a delay, but they'll get them back on. The market should price in that revenue to the Treasury continuing. Maybe not all of it, but most of it. And then that leads you to the conclusion that it shouldn't really influence the bond markets. So I'll add that to the mix. How about commodities, currencies, Kristian, I mean, gold's gotten its footing a little bit after the sell-off, certainly that was overbought just like tech.

Kristin Kerr (10:08):

Yeah, it's one of these things, you know, I guess, another big narrative that we've seen, you know, really the past year has been momentum and gold has been riding that momentum wave as well. So I think you know, the sell-off we saw really, I mean, it really kind of kicked off when you know, you started to get margin requirements increase in the gold markets. So, you know, more expensive to hold gold with leverage, that kind of kicked things off. And then you know, kind of got a pretty decent sell, but we're just hanging around that 4,000, that $4,000 an ounce mark. You know, just given kind of how euphoric or some of the speculation we were seeing in gold doesn't really surprise me that we got, you know, a fairly material sell-off.

Kristin Kerr (10:52):

Honestly, I probably like to see us get under 3,600-ish to really kind of start thinking that maybe there's a bigger dynamic going on here in the gold market, just because we had such a big runup. You know, I think what's interesting in commodities, honestly, is the fact that, you know, if you look at the Bloomberg Commodities Index you know, you and I had a call yesterday, the Morning Call, where we talked about the Bloomberg commodities equal weight index, which is breaking out to new highs. So what's interesting to me is that you're starting to see some very positive price action in commodities outside of the usual suspects that drive indexes, which is oil and gold, which are both kind of in a weakening phase right now. So I think there are some interesting stories going on in commodities outside of the main ones which I think, you know, has made some implications here. You know, need to see kind of how things play out. But the fact that you do have the equal weight commodity index breaking out is something I think worth watching here.

Jeff Buchbinder (11:49):

Yeah. So maybe watching oil is kind of like the bond market, nothing going on. Paint dry, grass grow <laugh>. But yeah, beyond that I agree it's getting interesting. And then copper's been certainly doing well and has some structural supports. So we'll continue to watch that. And obviously we'll keep watching the dollar as you always do, Kristian. All right, let, let's get deeper into this sell-off. So I guess we're going to look at the sell-off here. It's small, but for now through these various lenses of seasonality, sentiment, and breadth. And then of course, everybody's watching the Mag Seven, which has sold off more than the broad market and really leading, I would say probably the way down. So we'll certainly talk about that. And I guess you've got four charts here, Kristian. So we'll start with seasonality. This is something we showed you a couple of weeks back. The best six week window starts now, huh? Doesn't feel like it

Kristin Kerr (12:54):

<Laugh>. Yeah, I kind of wanted to put together kind of a little bit of a narrative through all these charts. But basically kind of my bigger level thinking here really is that, you know, there is a big behavioral aspect to the stock market, particularly around this time of year, where it becomes a lot about, you know, is the stuff that worked throughout the course of the year going to continue to perform into the end of the year, right? And you've got kind of this dynamic, especially in the institutional world where you have managers saying, well, you know, I'm lacking performance, so I need to buy what's been working to catch up in end of year. Likewise, you can get the same questioning saying, well, I've had a good run in these things. Do I take some chips off the table ahead of end of the year and lock in a good year, right?

Kristin Kerr (13:34):

So I think that is a really big dynamic that drives markets starting in November. And the reason I wanted to kind of show this seasonality chart is that coming into November, you know, my inbox was full with different, you know, sell side kind of emails, talking about, well, you know, November is, you know, the strongest month and we're about to get this kind of performance chase starting early. And you know, it was almost palpable the degree of excitement we were getting. And, you know, a lot of it was because of this whole sentiment idea. Now, what's a bit odd about you know, sorry about seasonality. What's been a bit odd about seasonality is the fact that, you know, it didn't really work, as you mentioned earlier, Booky during the weaker period.

Kristin Kerr (14:19):

But then there was almost this belief that, well, it's going to have to work now all of a sudden, right? So I think the fact that seasonality hasn't been working that great all year makes it a little less of a clear signal coming in to November. So we've kind of seen that dynamic play out a little bit here. But that doesn't mean to say we can't get it right. You know, a lot of the times, we'll look at these seasonality signals and say, well, you know, you're going to have a strong month that's going to start from, you know, the first day of the month and continue on to the end. And a lot of times it's the path to get there that really matters. So, you know, maybe this is just, you know, it's still going to play out, but you have to kind of go through a little bit of a shaking of the tree first, which maybe is what we're going through right now, but I thought that was just interesting how much people were talking about seasonality coming in November and almost too much so to where, you know, we've gotten this negative price action, you know, almost right out of the gates or you know, from the start of the month when everyone's looking for a strong month.

Jeff Buchbinder (15:16):

Yeah. So a market that priced in a little too much enthusiasm, and as you have in a later slide here, maybe was getting a bit complacent. I think it's also reasonable to say that we pulled forward some of these gains, right? Like you said, the last six months have been very, very strong. I think it was one of the best six month periods ever during the "Sell in May" period. So coming off of that a little bit of a pullback, makes some sense. So here's complacency, right? Just alluded to it. This was, this is probably a reason why we're getting some jitters now.

Kristin Kerr (15:56):

No, it was going to show, you know, how much excitement there really was coming into the month on this, you know, idea of a performance chase starting now. You know, the seasonality aspect, and this is the, you know, the CBOE put call ratio. And you can see I put that green line is a two week moving average. And really what I was saying, you know, there might be an area of complacency is that we just kind of got to pretty low levels. So people buying calls, not buying puts and just were very steady through, you know, the fall through much of October started to pick up a little bit towards the end of the month last month, but really haven't, you know, there's still kind of this excitement in the market. You know, I would even say a little bit of, you know, uber speculation.

Kristin Kerr (16:38):

We were seeing really in some of the you know kind of, for lack of a better word, the junkier names in the market right. We're having some big runs that start, it's really started to kind of peak out in October. But really it was just trying to highlight that there was, you know, a lot of excitement coming into the month based on this notion that, you know, we have to get a performance chase starting right here and now. And the market was skewed that way. You know, I look at another sentiment index called the Daily Sentiment Index, which looks at tracks basically retail futures traders, right? They tend to be trend following in nature of that cohort. And, you know, that got up to the mid high eighties of sentiment, which is pretty extreme.

Kristin Kerr (17:22):

So, you know, 80, 85% call it, were bullish on the S&P continuing higher. There was you know, another sentiment survey conducted by ISI, right? So mostly institutional accounts, and they were asking them where the next 10% was going to be in the market. And that was at all-time highs in terms of coming up, kind of looking for the next few months as well. So, you know, a lot of sentiment was skewed to the market going higher. So a lot of times, you know, when you look at this from a contrarian lens or perspective you know, that means you might need to see a little bit of a pullback just to kind of temper those expectations a little bit, which I think is kind of what we've, you know, seen here call it the last week or so.

Jeff Buchbinder (18:07):

Yeah. So for those who aren't familiar with the options terminology, the, you know, the put call ratio, when you have more puts, that's more fear. So naturally this ratio spiked in April of this year around the liberation day tariff scare. You have these other little sell-offs that have caused more fear, but when this reading is low, that's kind of complacency, right? So, late October, mid-October, actually mid-October was about as low of a reading of this as we've gotten this year. So that is a very complacent reading which set the tables for the volatility that we've seen this week. So this is a really interesting chart here, because, you know, people look at the S&P 500 and they say, oh, it's down 3.5%. That's not much, no big deal. But if you look underneath the surface, you actually have a lot of names that are, I mean, not only in correction territory, but in bear market territory.

Kristin Kerr (19:06):

Yeah. Yeah. I want to highlight this just from going back to that lens that, you know, you had this kind of excitement about a performance chase going into the end of year, you know, what's been working. And I think you can really see it in this chart, just giving like, how narrow the breadth has been. It's basically been, like I was saying, you know, Mag Seven and some of these kind of, you know, junkier parts of the market where there was a lot of kind of self-directed retail euphoria in it, and everything else has been struggling, right? Whereas Adam pointed out in this chart, you know, your median stock is, you know, down around 15%, pretty close to, you know, closer to bear market territory than bull market territory. So it's been a very, very narrow market.

Kristin Kerr (19:50):

You know, the traditional way to look at breadth was always, well, you know, if you've got a market rising, but it's only being led by a few, that's, you know, that's a potential negative. You know, I would argue that's changed a lot in the era of, you know, passive investing, of factor analysis, all these types of things. You know, we've had generally not great breadth for, you know, a lot of this bull market. So I'm not sure, you know, how significant it is, but you know, the fact that we are kind of got to pretty extreme levels here. I think it was too much for the market to ignore. Now, the interesting dynamic that sets up is you know, a couple things. One is that if breadth starts to get too extreme, you almost get oversold in the areas that are underperforming, right?

Kristin Kerr (20:40):

So a lot of times you have to almost view it from that lens as well as that when you get narrow breadth, it could be a negative, but then if it gets too narrow, then the areas that are kind of unloved can easily squeeze on you, right? So I think that's a potential dynamic to be watching here into end of year. But really just want to highlight, you know, this market's been driven really by kind of the S&P 10 let's call it, especially over the last few weeks. And I think a lot of that was driven on this idea that, well, you know, we're going to get a performance chase. What do you buy? You buy the stuff that did really well all year, that's been the S&P 10. And you kind of you know, saw that I think driving things. Now, I'm not convinced that that's still not going to happen, right?

Kristin Kerr (21:23):

That's, you know, I just want to make that point clear that we can still get a performance chase this just might be a shaking of the tree before it just didn't happen. As soon as November 1 when people are looking for it, then it might, you know, it might be more of a December story, whatever it is. And this could just be kind of the necessary pullback you needed before you get that type of move. You know, the flip side would be that, you know, people start taking their chips off the table and we just don't get it. But I think it's an interesting dynamic to be watching here because I think you know, it is a bigger important, you know, that behavioral aspect of markets, that game theory aspect of markets is very much in play over kind of call it the next two months or a little less than two months before end of year.

Jeff Buchbinder (22:06):

Yeah. At the index level, we're flirting with that 50-day. We haven't been there in a number of months. So that'll be an interesting test to watch. Typically, we don't call a breakdown in one session, right? So not only will we be watching this this afternoon Friday, we'll watch it certainly early next week as well. And that if it holds, could be a logical place for some buyers to come back in, at least at the index level. But certainly I think on the, in terms of the areas that aren't working, healthcare might've been first, right? Healthcare wasn't working for a very long time, then it started working. And so maybe some other sectors follow that playbook and you start to get some other better performance from, I don't know, areas like industrials, materials, utilities, real estate, you know, some of these other areas of the market. Well, utilities have develop up well given their defensive nature, but there's certainly a lot of names that are not working in the more economically sensitive sectors. So we want to watch the Mag Seven, does S&P 10 but we certainly want to pay attention to the rest of the market too. So speaking of the Mag Seven, here you go. It's testing a support line, just like the S&P 500 is. And by the way, the tech sector is also testing it's 50-day.

Kristin Kerr (23:32):

Yeah, yeah. And you can't really see it in here, but there's a purple line in there, which coincides with that bottom white channel line, which is the 50-day, right? So pretty nice confluence there of two big levels. But yeah, I wanted to highlight, you know, again, looking at it from that well market looking for a performance chase, you know, what happened, you know, start of the month you know, we come in and Mag Seven, which is driving everything, which theoretically is where the money would want to go in a performance chase type of dynamic. You know, we were at the, you know, basically kissing the top end of that channel that we've been in for you know, basically since the April lows. You know, we have that kind of initial drive up and then have been in a nice channel since May.

Kristin Kerr (24:12):

And we got up there, touched it at the end of last month, and then got real close again to start the month. And it was kind of a natural level where you expect some resistance you know, just to be like simple about it, you know? And we pulled back within that channel you know, I think we actually undercut it by a little bit today, but that's kind of where we are, right? So where this is completely, you know, a normal pullback dynamic so far, you know, kind of going back to the bottom end of the channel, going back to that 50-day moving average, I think, you know, where you can maybe make the case that we might not get the performance chase dynamic is if we were to kind of take that channel line out, take the 50-day moving average out convincingly, right?

Kristin Kerr (24:52):

Not in a kind of flirt below it, but actually like a real breakdown below it, maybe even go back up, test it turns into resistance. You know, those are things I'd be looking for to signal that maybe we're getting kind of a, you know, a deeper pullback, a deeper correction scenario starting you know, not there yet. And I think, right, you know, kind of, we started to kind of balance here late today. So I think maybe, you know, that's what you're seeing is kind of buyers coming back into the market right around these clear support levels. Something I'd be watching you know, just given how influential Mag Seven has been on the broader market, you know, makes up 40% plus of the S&P 500. So kind of, you know, so goes the Mag Seven, so goes the index right now. So I think these are really important levels from a short term perspective to be watching. And, you know, again, if we hold here, we could very easily see that performance chase dynamic, kind of the narrative kind of build back up again, right? So, I think these are pretty critical levels from a near-term perspective.

Jeff Buchbinder (25:52):

Yeah, it's nice to see this intraday bounce today, not just in tech, but broadly. We'll see if we can get back close to even. But yeah, these support lines, when they all line up, they get my attention more than they normally would, even as a fundamentally-focused strategist. So thanks for that Kristian. Great stuff. Let me do a quick preview of the Weekly Market Commentary, which will be out by the time you see this on lpl.com. Jeffrey Roach's attempt to put the AI investment into perspective. So I pulled one chart from his commentary, which shows the data center component of non-residential building this is in the you know, GDP data. And you see that data centers are just booming. I mean, gosh, if you go back two years, we're talking about like a triple. Data center, buildout booming and everything else sliding.

Jeff Buchbinder (26:59):

So there's not as much non-residential construction going on ex data centers. So just this, just one attempt, one way to put this into perspective, he has a couple other charts that attempt to do the same thing. This is not breaking news here, but the AI investment story is huge <laugh>. It is absolutely enormous. Now, part of the reason for the sell-off this week is because people are starting to doubt whether these promises will actually be delivered. There is still great promise, I don't think too many people disagree with that from AI, but these are really, really big numbers and there's increasing scrutiny on whether the dollars will actually be there. So I'll throw that kind of caveat in there as we talk about how big,

Kristin Kerr (27:47):

How are you going to, you know,

Jeff Buchbinder (27:49):

These numbers are,

Kristin Kerr (27:50):

How are you going to fund this, right? How are you going to raise this money? I think you know, the story for the most part the last few years has been, well, you know, these big companies have, you know, the cash flow to be able to do it. And now you're having to go into the debt markets, find other ways to finances. I think that's maybe what's causing a little bit of this questioning, you know, the ability to continue at the same pace going forward.

Jeff Buchbinder (28:16):

A hundred percent. And OpenAI is not Alphabet or even Meta where they have the core business that can support this spending to this level. So that will take some time. So good thought there. Let's keep going Kristian and do the week ahead, which is tricky. I didn't put a data calendar in there because it would've just confused people because we're probably not going to get any of the government data. So I just put a list of things here to watch. The earnings really dies down, right? We're only going to get, I think it's a dozen names or so in the S&P 500 next week. It's kind of a pause that refreshes because then we really get a pick up in some of the later reporting retail and tech names. But there will be some reports for people to digest.

Jeff Buchbinder (29:07):

I think though it makes sense to take a step back and just look at the earnings power here that we've gotten. The S&P 500 is going to expand margins from Q2 to Q3, even as tariffs ramp. Not too many people saw that coming. And remember, we and most others thought that we'd get an upside surprise to earnings that was maybe a little smaller than what we've seen in recent quarters because of the tariffs. Wrong. We got basically the average upside surprise that we've seen in the last few quarters, 7%. Unbelievable. So earnings are going to grow 15, maybe even 16, 17 if you take out Meta's tax charge. That is impressive. Of course, the market isn't responding positively to that right now, but again, it still creates a positive, a strong fundamental foundation underneath this market as long as those earnings come through. Alright, with that, I will hand it over to you Kristian, to talk about what else you're watching.

Kristin Kerr (30:09):

Well, just on your comment, I would add in maybe, you know, I'm still not sure the tariff impact has, we really understand it fully because I think you're starting to see margins come under a bit of pressure now though too, right? I think that's probably a big catalyst why we've seen more starting to see an increase in layoffs. But I do wonder if, you know, so you can make the case essentially that they've, you know, companies basically took the, took the brunt of the tariff impact, but as margin pressures become greater, does that still happen, right. You know, I think it's still a dynamic that we don't fully know. But just something that I'm watching out there and in terms of, you know, broader calendar. Yeah, you know, I was looking at the global calendar coming into this call and it's, there's not much going on there either.

Kristin Kerr (30:58):

It's probably one of the weeks where assuming we don't get U.S. data and international data is really light, it's probably one of the weakest calendar weeks I've ever seen in my career in terms of there not being any things to be watching out for. You know, I would add in there, you know, the betting markets are starting to kind of price in an end to the government shutdown starting really next week is when you're starting to see the potential for it. So I'd be watching for that as well. Maybe that headline, you know, as I mentioned earlier, that, you know, that could in theory kind of be seen as an induction of liquidity into the system that could help things you know, maybe you know, be a positive headline for risks or something else. Something else I'd be you know, keeping a weather eye on for.

Jeff Buchbinder (31:41):

Yeah. And then we got the CPI, it was delayed last month, so maybe we will get the CPI in the next week to 10 days. We'll have to see. But as I said before, I don't think inflation data is as important right now given the environment. I think people are more focused on the job market and growth. And I would bet that we're going to get the jobs data before the Fed meets. And if you get that data and it solidifies the market's expectation that we're going to get a cut in December, the end of the shutdown and the pricing of that cut could potentially help stocks from that point forward. So a lot of uncertainty, but there's certainly, as you alluded to Kristian, some positive catalyst here potentially that could help us follow that positive seasonal pattern. Because you end the year positive when you have a strong year through October, it's almost every time. Yep. And so while that enthusiasm for the late year chase maybe got over it skis, it's still, there's still a good chance that it comes. So.

Kristin Kerr (32:54):

Yeah, it's a path to get there, like I said, right? I think there was just, there was too much thinking that the path would be linear, right? And it's, there's a bit more zig and zag before that happens. But yeah, I'm kind of in your camp where I think it probably does end up happening. It's just, it's not, wasn't going to be as linear as the markets were probably thinking on November 1.

Jeff Buchbinder (33:16):

Yeah, I know. That's a favorite topic for Adam Turnquist, our technician, talks a lot about how bull markets aren't linear. And this one certainly is not, although it was between May and October. What's that?

Kristin Kerr (33:34):

Saying it's felt like in the last six months.

Jeff Buchbinder (33:36):

Bingo, we were saying the same thing. Yeah. All right. So we'll keep watching for data, a break in the shutdown, earnings, evidence that AI is going to reach its promise, and then this ongoing test of 50-day moving average for the S&P. So we'll go ahead and wrap up there. Again, by the time you listen to this, you will have already had hopefully a good weekend. So everybody have a wonderful week. Thanks Kristian, for sharing all those great insights. It's a tricky time. There's a lot of, let's call them crosscurrents in this market to sort through. So thanks for helping our advisors and clients and everybody else listening understand all that. So everybody, have a great week. Take care and we'll see you next week.

Kristin Kerr (34:20):

See you later.

Jeff Buchbinder (34:21):

Thanks for listening to Market Signals. Bye now.