Investors are nervous - and yields are low. If you get higher interest rates as well as a peak and reversal in Covid cases, ironically that's a market risk, much as it would be a welcomed scenario for both people and business.

At the same time of course a washout in 'yields' and a spike in the S&P upon realization of 'peak Covid', would be terrific. Just expect a) that's unlikely yet to be the case; and b) it might not be so terrific for the S&P beyond initially. I think we're seeing 'hints' of 'peak Covid' in the U.K.; not really yet in the U.S.

At the moment the S&P might like to celebrate the concept of Covid-cresting; but we're not there yet. One can hope regardless of the shuffle in stocks. We do see Tuesday turnaround as a rebound from Monday's just modest fade.

Again our wildcard continues to be Covid; and the 'presumed' dovish Fed as relates to 'tapering'. And Jackson Hole is forthcoming. The Fed shouldn't be in the market's face 'formally' until October or November; but the comments that will be made might help lean analysts to view them with a slightly hawkish tilt; but again only if we see a peak and downward curve from Covid / Delta.

This would be the idea like traveling North... go far enough and without doing anything you're actually going South. If Covid (terrible way to herd immunity) sweeps most everyone who has been reluctant to get vaccinated, then we get more tragic suffering in the interim.

Now alternatively there's the real idea of even higher proportion of vaccinated citizens (70% in partial form now) which (combined with the percent that had Covid, hence antibodies) being probably closer to 80%; and that might be enough to close the corral on Covid, and achieve herd immunity that way. Epidemiologists seem in a frantic mood about all this; and that means they hope so but don't know.

Let's be clear: so far we don't see delta peaking; although at this pace it gets most everyone remaining pretty quickly (whether they present disease or not); so there's a true scramble for people to get vaccinated or just marinade in the belief their freedoms are involved (maybe so; but the virus doesn't care.. not to say our authorities handled this right last year 'or' this year' but at least we have 'imperfect' vaccines; with better ones 'and' low-dose MaB's coming.

None of this is particularly fun to analyze, but I'd rather analyze than deal with Covid again (been there, done that, and it's not fun to say the least). Pfizer is the way to go in my humble opinion as far as 'current' vaccines go (about 4x lower reactions reported; and that's because it's a smaller total shot too; a bit of detail I had to dig deeply to find info. about, related to vaccine design).

Executive summary:

• General S&P / NDX extended perspective prevails; little upside potential at the moment; with more downside risk; however Tuesday should rise;

• Against that (technical and bifurcated) reality; we have Covid rampaging; and that suppresses Q3 and probably Q4 economic prospects, regardless of whether governments clamp-down hard; or we really get 'peak Covid';

• Many people are freaked by hearing of limited vaccine efficacy; and are not convinced 'more of the same' (3rd shot of existing vaccine) is really the solution; so they limit socializing and activities voluntarily; we contend the approach shouldn't be so many shots; but availability of monoclonal antibodies (pills or nose drops/sprays or injection, not prolonged IV infusion);
• Going forward, people who had bad reactions to vaccines or just refuse it; will also be interested in monoclonal antibodies that mess little with an immune system response; but work on directly killing the virus it seems;
• This enhances prospects for not just Regeneron; but clearly Sorrento, if they can (finally) evidence efficacy on their monoclonal antibodies (that is the drops and other delivery methods such as direct injection);
• A weekend tirade by Mexico's President 'and' Health Minister rallied hard against big pharmaceutical companies wanting to give every man, woman and child vaccine; and repeat vaccinating them every year; then said we need 'treatments' for this, not big-pharma-enriching vaccines;
• On the flip side, 'solid earnings' really aren't relevant; while the slowing in growth due to Covid / Delta resurgence, keeps the 10-year very low; and that's more a factor helping sustain the S&P; more so than any earnings;
• The corollary is that once we have effective treatment / low-dose pills and monoclonal antibodies, the S&P might set back a bit more aggressively;
• Hearing of the 'cruises' and heavy spenders in Las Vegas doesn't comfort me; but rather suggests high community transmission (spreader) events of course; while hoping most people engaging in all that are vaccinated;
• Israeli testing 'in Greece' of a nasally-inhaled CD-24 anti-Covid drug has good outcomes in a limited number of patients; with more tests coming; it is meaningful as science (finally) moves away from sole vaccine reliance;
• Much freaking-out about China; which is now largely shutdown due to a new round of Covid attacks; as to their 'crackdown' on economic growth; I am not buying that entirely; I sort of grasp the anti-monopoly aspects as well as the pressure to not have private online companies compete with banks, which must have the comrades up in arms at the thought (they're many capitalists in China; but the ruling communists are fighting back);
• Hence the view of China turning away from companies is a misnomer; it's more likely just preservation of the Chinese Communist Party apparatus; China knows they have to turn to globalization to be stronger, and have a few challenges to overcome (including natural disaster poor responses);
• In the long run the ideal would be: they want to limit corporate power; but enhance competition and keep online businesses out of the realm close to banking or digital currencies, which also undermine central banks; and stop the aggressive designs on Taiwan and the South China Sea islands.