Soft landing - allowing S&P to muddle through is what some analysts desire from the coming week's remarks surrounding the FOMC Meeting. All this is a bit shadowed by the hesitancy at getting First Republic Bank sorted-out; even as the Fed sort of accepted partial blame for not being on-top of regulating all regional banks, especially in California. However they are still slow given that now they demand 'bids' for the Bank from suitors by Sunday evening...again a last minute maneuver to avoid rocking Monday's upcoming business week.

It's all mythical in the sense that the constrained banking and lending picture, contributes to a dearth of growth; so that's why there's a Fed pivot looming; of course eve even if they hike again, as Chairman Powell uncharacteristically slipped to a 'Russian' fake chat discussion (if that's believed it doesn't say lots in regard to who the Fed Chairman takes calls from, or screening of his calls).

The equity market is already 'way down' outside of the Indexes, which is why I have contended for months that you 'can't easily crash the already crashed'. I do believe you'll get a shakeout and erosion in already suppressed straining fatigued stocks; however here and there (AI?) some will hold higher bottoms.

You are back into a situation that I've termed 'generals out in-front of troops'; an allusion to my view of most of 2021 and 2022, whereby average stocks for sure had retreated, with a handful of mega-cap giving an illusion of leadership or a stronger market 'perception' than really existed. Again we have that while this time at least the breadth perked-up a bit; so the bedraggled regiments of stocks (troops) are typically a bit better; but nothing in comparison to a focus returning to the biggest of all tech stocks (with probably reduced potential). It may be (ideally) that this divergence is addressed in May; setting-up broader gains in possibly unified fashion into the middle of Summer.. too soon to tell.

In sum: S&P got through April reasonably well, actually higher within context of a 'Spring rally' of sorts; accompanied with lots of uncertainty and ongoing 'tension on the tape', as well as bifurcated behavior of diverse equity sectors.

Bottom line: the metrics of capital preservation while seeking optimum entry points continues to be challenging; especially for big money managers trying to improve performance but consigned to big-cap stocks they can move both in-and-out of with alacrity.

Presumably many of these managers have agreed that not much was going to change 'yet', and probably engaged in 'lending' a lot of their shares to short sellers (for higher return) and/or wrote options so as to produce income from these holdings. Since net-net movements have mostly been minor in nature, it has been a month in which option writers came out fine; buyers generally not.

The majority continues to expect a crack in the labor market and recession; a condition we're generally in...but even that is bifurcated. Likely there will be a shakeout in S&P; but possibly it won't be 'sell in May and go away' this time. I suspect they already sold and departed; now looking for a washout to enter.

More By This Author:

Market Briefing For Thursday, Apr. 27
Market Briefing For Tuesday, Apr. 25
Market Briefing For Monday, Apr. 24