Thursday, April 3, 2025 6:29 PM EDT
As I’ve mentioned, the assumptions behind S&P 500 earnings estimates were too optimistic, and valuations made this one of the most expensive markets in a generation. So, we’ll see where things go, but right now, with 5,400 breaking, we could be heading back toward 5,200—that price point we’ve discussed for some time—unless the market snaps back quickly and reclaims 5,400.
(Click on image to enlarge)
That may be problematic because we get the jobs report tomorrow, with an expected unemployment rate of 4.1%, but Kalshi is pricing at a rate of 4.2%. Additionally, Powell will speak tomorrow, and today, a few Fed officials, including Vice-Chair Jefferson, are talking about taking a wait-and-see approach. It sounds like a higher risk of unemployment and Powell giving the market a shoulder shrug tomorrow. Unfortunately, no one will rush in to save the equity market at this point.
The CDX HY Index was wider today, moving up to 410 bps, and it comes to an interesting point in the road. I don’t know what happens next, but at the very least this seems to suggest that either we are going to see the market pause and stabilize, or things are about to get a lot worse.
I think things will move quickly if you get a higher-than-expected unemployment rate and a wait-and-see Powell.
(Click on image to enlarge)
More By This Author:
The Day After Tariffs: Complacency Meets RealityS&P 500 On The Brink Of Breaking Lower Ahead Of The Big Tariff Event To Be Or Not To Be, That Is The Question…
This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. ...
more
This report contains independent commentary to be used for informational and educational purposes only. Michael Kramer is a member and investment adviser representative with Mott Capital Management. Mr. Kramer is not affiliated with this company and does not serve on the board of any related company that issued this stock. All opinions and analyses presented by Michael Kramer in this analysis or market report are solely Michael Kramer’s views. Readers should not treat any opinion, viewpoint, or prediction expressed by Michael Kramer as a specific solicitation or recommendation to buy or sell a particular security or follow a particular strategy. Michael Kramer’s analyses are based upon information and independent research that he considers reliable, but neither Michael Kramer nor Mott Capital Management guarantees its completeness or accuracy, and it should not be relied upon as such. Michael Kramer is not under any obligation to update or correct any information presented in his analyses. Mr. Kramer’s statements, guidance, and opinions are subject to change without notice. Past performance is not indicative of future results. Neither Michael Kramer nor Mott Capital Management guarantees any specific outcome or profit. You should be aware of the real risk of loss in following any strategy or investment commentary presented in this analysis. Strategies or investments discussed may fluctuate in price or value. Investments or strategies mentioned in this analysis may not be suitable for you. This material does not consider your particular investment objectives, financial situation, or needs and is not intended as a recommendation appropriate for you. You must make an independent decision regarding investments or strategies in this analysis. Upon request, the advisor will provide a list of all recommendations made during the past twelve months. Before acting on information in this analysis, you should consider whether it is suitable for your circumstances and strongly consider seeking advice from your own financial or investment adviser to determine the suitability of any investment.
less
How did you like this article? Let us know so we can better customize your reading experience.
