DC Lite #456

In partnership with

1. ISM Services. "Sept ISM Services prints at 50.0, below the est of 51.7, driven by big declines in the New Orders and Current Business Activity (lowest since May 2020) components."

2. Commodities vs. breakevens. "The gap between commodities and inflation expectations has never been this wide. If you ask me which one likely drives the other: I would unequivocally side with the ‘yellow line,’ my real-world inflation gauge, since most goods worldwide are ultimately driven by commodity cost dynamics."

3. Mag 7 positioning. "While positioning in the so-called Magnificent Seven group of tech giants … was at its highest level since June 2024 among Goldman clients, many still plan on adding exposure."

4. VIX compression. "Just with a cursory glance, very rarely have we seen compression like this and not seen a material move higher in vol. Possible for the market to ignore it? Absolutely. It just hasn’t done so very often."

5. Q3 EPS revisions. "The third quarter marks the first time that analysts have increased EPS estimates in aggregate during a quarter since Q4 2021 (+0.3%)."

ICYMI