DC Lite #29

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1. Q4 GDP. The Atlanta Fed's GDPNow model estimate for Q4 GDP growth (SAAR) jumped to 2.6% from 1.2%.

2. 10-year vs. first cut. "How does the 10-yr Treasury yield perform after 1st rate cut with or without a recession? Looks like without a recession there is a sharper and more sustained downtrend in 10-yr yield."

3. Retail investor sentiment (I). "Bulls now outnumber Bears by 32% in the AAII Sentiment poll, the largest positive spread since April 2021."

4. High P/E vs. low P/E. "Over the last 10 years, stocks with the highest Price-Earnings ratios have beaten stocks with the lowest Price-Earnings ratios by 2.2% per year. Before this cycle, the prior record was set in the year 2000, the peak of the Dot-Com bubble."

5. Overbought SPX. And finally, “at the index level – SPX is nearing the most overbought level (RSI >70) in well over a decade.”