Truth of the tape | Sum of All Fears

Описание: Sum of All Fears

Churchill’s comment sum of all fears references risks from the combination of military branches. In markets last week, the sum of all fears came true as markets digested higher producer price inflation, higher margins on precious metals, lacklustre earnings from some tech majors and the nominee for the next FED chair, waking volatility from its somnolence.
While post-event narratives attributing causality warrant skepticism, the forward trajectory remains clear - Volatility, Earnings, and Inflation will dominate 2026 market dynamics
Equities face a critical inflection point where earnings quality and forward guidance separate winners from losers, exemplified by the stark divergence in Microsoft and Meta post-earnings price action. AI development velocity threatens established norms, howsoever nascent, with Moltbot and Kimi representing emerging competitive threats. Sector preferences favor Memory, Semis, and Chips within Technology, alongside overweight positions in Industrials and Healthcare.
Inflation and Interest Rates present persistent headwinds as Treasury yields anchor above 4.2%, reflecting structural inflationary pressures (tariffs), commodity prices, economic resilience, and fiscal expansion that collectively are a headwind to monetary easing.
And In Precious Metals, The fundamental case for Gold as a currency diversifier and Silver shortages remains in place. Higher margins will likely flush out speculative positions. We reiterate our call for a volatile path rather than the secular trend of last three years. Gold remains preferred over silver.
The coming week has plenty of action - from payrolls to market defining earnings that will collectively determine whether volatility subsides or the sum of all fears causes more pain.