A narrative of ours is that “markets don’t like uncertainty.” In fact, we’re very bullish equity markets from these levels after the election, because regardless who wins there is either some certainty or less uncertainty coupled with accommodative Federal Reserve policy.
Today’s news is a great example as to the market paying attention to the headlines it wants; something we often discuss. If stocks haven’t already been vulnerable, or in a healthy correction pattern, we may not be seeing such damage across the banking sector weighing on the market broadly.
Although our goal was never to pick the exact top, the timing of our warning was perfect. Furthermore, we wouldn’t be surprised to see U.S. benchmarks pare the bulk of yesterday’s losses and finish the week on a strong note.