1. Bank Stocks Are Getting Hammered: Are They Telling Something?
Over the past three months, Goldman Sachs stock has dropped more than 22%. Bank of America is down today (on some legal issues) but has fallen more than 17% over the past three months. Morgan Stanley is down more than 20%, Citigroup is down more than 7%, and JPMorgan is down close to 2.5%.
The financial sector ETF, XLF, is down 3.2% over the past three months.
Bank stocks are not doing well as rates have moved higher. This is worth watching closely.
Are bank stocks trying to tell something?
2. CPI Hits 3.7% And Inflation Isn’t Going Anywhere YET
This morning, we got the U.S. CPI report. Inflation came in at 3.7% year over year, which was around what everybody was expecting. Month over month, prices increased 0.6%.
Inflation remains above the Federal Reserve’s target, and the factors driving inflation aren’t really coming down, with oil prices remaining high.
That’s going to work its way through the economy and could keep U.S. inflation elevated for a while.
The 10-year Treasury yield jumped to 5.26%, while the 30-year is at 5.58%.
But, this is all going to cause demand destruction.
3. Gold Slips Below $4,100 — Silver Takes a Beating
Gold price is under pressure. At the time of writing, gold is trading around $4,088.
Keep in mind, $4,000 is a major support level. If gold moves below that, things could get very painful.
Silver is falling hard as well, with spot silver currently at $56. A major support zone between $53 and $55 sits just below. It will be interesting to watch what happens.
Keep in mind, the pressure on precious metals is coming from higher yields and a stronger U.S. dollar.
4. The U.S. Dollar Is Making Its Move With Loonie at Risk of Breaking
Looking at currencies, the U.S. dollar is really making a move. The U.S. Dollar Index crossed above 102 today and is currently at 102.89.
Let’s see how it closes. A close above 102.5 would be worth watching closely, putting the dollar at its highest level since early 2025.
Meanwhile, the Canadian dollar is finding support at 70 cents against the U.S. dollar. But if that level breaks, there’s a possibility the loonie sees a solid move to the downside.
The yen is at 158 against the U.S. dollar. Keep in mind, 160 is the level where we’ve seen interventions.
The euro is also sliding against the U.S. dollar, hitting levels last seen in 2025.
5. The Market’s Mirage: Indices Up, Most Stocks Down
Earnings season is underway. Know what you own and why.
Looking at what’s happening in the stock market in detail, there’s something troubling you should know. A few names are creating the illusion that everything is great. Far from it.
If you look underneath, you quickly find that less than 50% of S&P 500 companies are trading above their 200-day moving average.
On the Nasdaq, just 34.5% of all stocks are trading above their 50-day moving average. On the NYSE, that figure is 37%.
A few stocks are boosting the indices. Underneath, there’s a lot of pain.