S&P 500 recovered from premarket weakness, and withstood hot PPI – well, for two hours, and couldn't challenge Thurday‘s enthusiasm at the close. Nasdaq lost the promising daily outperformance, unable to build on many good earnings this week, and that‘s a sign in itself as much as financials continued weak showing (not a crash, but more than profit-taking as those rate cut expectations have to get further deferred, which is what XLRE and ITB notice too).

The key market to have an eye on, is though still the US dollar – its breakdown is continuing, and Friday is but a respite, most welcome to those looking to take advantage of silver and gold hammering (in due time). Simply put, whiff of risk-off and poor market breadth, allowing for rush into short-term Treasuries, with neither Russell 2000 nor biotech benefiting, while the Iran strikes are hanging over the market this weekend too.

That brings a question about earnings and valuations following the last few double digit S&P 500 growth years – as these earnings catch up and just rise, will P/E multiples keep pace? I‘m of the opinion that earnings are rather growing into multiples already in place, and won't cause any dramatic P/E expansion (not typical of midterms year) – 2026 will be a bullish year, but not as rich as last one or the one before.

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