2026-05-03
Strategist Letter · 2026-05-03

Morning Note

The tape is trading risk on (composite score +0.55), with SPY +0.28%, QQQ +0.96% and IWM +0.47% on the session. Universe breadth sits at 61% above 50-day and 58% above 200-day, and VIX prints 16.99 (-9.2% over five sessions). At the GICS sub-industry level, leadership concentrated in Technology Hardware, Storage & Peripherals (+5.36%), Systems Software (+5.26%), Communications Equipment (+2.96%), Application Software (+2.64%). On the laggard side, Human Resource & Employment Services -2.53% headed the weak list. No industries crossed into the Leading RRG quadrant in the last five sessions. Cross-asset color: the dollar (UUP) +0.18%; long bonds (TLT) +0.36%; high yield (HYG) +0.12% — credit stress widening; crude (USO) -2.92%; gold (GLD) -0.11%; bitcoin (BITO) +2.74%. The 2s10s curve sits at +80bps. Risks worth tracking: watch the recent death-cross prints in Passenger Airlines, Construction Materials; and 200-day breaks in Hotels, Resorts & Cruise Lines, Multi-line Insurance, Investment Banking & Brokerage; the breadth tape shows 9 new stock-level golden crosses against 20 death crosses. Catalysts in the wires: on geopolitics: 'Iran war, oil surge — How to navigate the volatility at PRO Live' [CNBC]; on Fed / macro: 'Pirro appears to drop plans to appeal criminal investigation of Fed Chair Powell' [CNBC]; on AI / tech: 'Apple delivers a nearly perfect quarter, with a CEO change and an AI update ahead' [CNBC]; on energy: 'OPEC+ announces modest boost in oil production. But here’s why it’s a mostly symbolic move.' [MarketWatch Top]. Positioning takeaway: lean into Technology pockets where breadth is improving and trim exposure in Energy until 200-day support is reclaimed.

Cross-Sector Linkages
What the spreads are telling us
8 active linkages today.
Each card shows a classic cross-sector or cross-asset spread, today's reading, and the positioning takeaway. Risk-on / risk-off / mixed badges aggregate into the regime read.
Cyclicals vs Defensives
risk-on
Cyclicals (+0.10%) are leading Defensives (-0.39%) by 0.49pp.
Risk appetite firm — the tape is paying for growth, leverage and operating cycle exposure.
Discretionary vs Staples
risk-on
XLY +0.24% vs XLP -0.17% (spread +0.41pp).
Consumer is risk-on — the household balance-sheet trade is working.
Semis vs Software (AI capex theme)
risk-off
SMH +0.61% vs IGV +3.24% — spread -2.63pp.
Software is leading semis — AI monetisation narrative dominating, or semis exhaustion.
Energy vs Utilities
neutral
XLE -1.34% vs XLU -0.64% — spread -0.70pp.
Disinflation/duration bid; long-bond proxy outperformance signals lower-rates regime.
Stocks vs Bonds (SPY vs TLT)
risk-on
SPY +0.28% AND TLT +0.36% — both bid.
Liquidity tape — stocks and bonds rallying together signals easing financial conditions.
Dollar vs Equities
neutral
UUP +0.18% / SPY +0.28%.
Dollar strong with equities up = US exceptionalism / yield-driven, watch EM.
Credit vs Treasuries (HYG vs IEF, 5d)
risk-on
HYG 5d -0.00% vs IEF 5d -0.53% — spread +0.53pp.
Credit tightening / risk premia compressing — bullish for equities.
Momentum vs Min Vol
neutral
MTUM +0.39% vs USMV -0.06% — spread +0.45pp.
Momentum / Min-Vol balanced — neutral risk preference.
Regime
Risk-On
Composite +47.0 (-100..+100)
VIX +0.58 Curve +0.80 Credit -0.00 Breadth +0.32 Momentum +1.00 Dollar +0.12
VIX (Vol Regime)
16.99
5d Δ -9.2% · Stable
Breadth (S&P 1500)
61% · 58%
Above 50d / above 200d
52w highs: 129 · 52w lows: 53
Yield Curve · 2s10s
+80bps
10Y 4.38% · 2Y 3.58%
Steepening
Equity Markets
Sector Heatmap
Color intensity = magnitude of 1d move. YTD shown beneath.
Where the money is flowing today across the 11 GICS sectors. Green = leadership, red = laggards. The intensity of the color tracks the magnitude of the day's move.
Technology
+1.49%
YTD +12.3%
Cons. Discretionary
+0.24%
YTD +0.4%
Communication Svcs
+0.18%
YTD +0.2%
Cons. Staples
-0.17%
YTD +8.9%
Real Estate
-0.18%
YTD +10.5%
Materials
-0.23%
YTD +11.8%
Financials
-0.40%
YTD -5.0%
Health Care
-0.57%
YTD -6.3%
Utilities
-0.64%
YTD +8.6%
Industrials
-0.93%
YTD +9.8%
Energy
-1.34%
YTD +29.8%
Intermarket
Cross-Asset Tape
Equities · rates / credit · commodities · FX / crypto.
A single tape across the major asset classes. Use this to read regime: equities up + dollar down + bonds up + credit tightening = classic risk-on; the inverse is risk-off.
Equities
Symbol1d5dMTDYTD
SPY S&P 500 +0.28% — — +5.77%
QQQ Nasdaq 100 +0.96% — — +10.09%
IWM Russell 2k +0.47% — — +12.46%
DIA Dow Jones -0.33% — — +2.78%
EFA Dev ex-US -0.22% +0.32% +0.00% +5.21%
EEM EM +0.22% +0.61% +0.00% +14.03%
FXI China +0.05% -0.14% +0.00% -7.56%
Rates / Credit
Symbol1d5dMTDYTD
TLT 20+y UST +0.36% -0.90% +0.00% -0.16%
IEF 7-10y UST +0.08% -0.53% +0.00% -0.13%
LQD Inv Grade +0.16% -0.52% +0.00% +0.09%
HYG High Yield +0.12% -0.00% +0.00% +1.24%
JNK Junk +0.10% +0.04% +0.00% +1.35%
Commodities
Symbol1d5dMTDYTD
GLD Gold -0.11% -2.32% +0.00% +6.25%
SLV Silver +2.45% -0.73% +0.00% +3.86%
USO Crude -2.92% +7.85% +0.00% +107.08%
UNG Nat Gas +1.04% +3.88% +0.00% -11.19%
DBA Agriculture +0.29% +2.63% +0.00% +9.98%
FX / Crypto
Symbol1d5dMTDYTD
UUP US Dollar +0.18% -0.25% +0.00% +1.11%
FXE Euro -0.10% +0.00% +0.00% +0.26%
FXY Yen -0.32% +1.51% +0.00% -0.26%
BITO Bitcoin +2.74% +1.00% +0.00% -13.48%
Sub-Sectors
Industry Rotation Map (RRG)
Equal-weighted GICS industry indices vs SPY. Full view →
Industries in the upper-right (Leading) quadrant are outperforming SPY with positive momentum — that's where the money is. Industries in Improving (top-left) often deliver the best forward returns. The trail shows where they came from over the last ~3 weeks.
Today's industry leaders
Industry1d5dYTDQuad
Technology Hardware, Storage & Peripherals Information Technology +5.36% +14.53% +154.28% N/A
Systems Software Information Technology +5.26% +4.94% -4.11% N/A
Communications Equipment Information Technology +2.96% +3.55% +90.85% N/A
Application Software Information Technology +2.64% +1.53% -16.03% N/A
Internet Services & Infrastructure Information Technology +1.94% +3.63% +34.89% N/A
IT Consulting & Other Services Information Technology +1.91% +1.07% -31.27% N/A
Passenger Airlines Industrials +1.91% -2.74% -11.00% N/A
Construction & Engineering Industrials +1.71% +6.55% +43.94% N/A
Today's industry laggards
Human Resource & Employment Services Industrials -2.53% +2.91% -18.65% N/A
Insurance Brokers Financials -1.99% -7.13% -21.72% N/A
Distributors Consumer Discretionary -1.96% -4.90% +1.23% N/A
Cargo Ground Transportation Industrials -1.81% -1.84% +34.95% N/A
Air Freight & Logistics Industrials -1.74% -0.43% +10.22% N/A
Restaurants Consumer Discretionary -1.69% -3.47% -3.24% N/A
Household Products Consumer Staples -1.60% -1.94% +9.22% N/A
Oil & Gas Equipment & Services Energy -1.47% -1.08% +39.75% N/A
Industrial Machinery & Supplies & Components Industrials -1.38% -3.34% +4.86% N/A
Oil & Gas Refining & Marketing Energy -1.38% +6.76% +47.49% N/A
Research & Consulting Services Industrials -1.33% -1.66% -10.53% N/A
Construction Machinery & Heavy Transportation Equipment Industrials -1.32% +0.16% +29.55% N/A
Other Specialty Retail Consumer Discretionary -1.26% -4.72% -19.38% N/A
Packaged Foods & Meats Consumer Staples -1.20% -0.06% -4.12% N/A
Construction Materials Materials -1.16% +0.70% +1.89% N/A
Automotive Retail Consumer Discretionary -1.15% +0.70% +9.14% N/A
Oil & Gas Exploration & Production Energy -1.11% +4.63% +36.87% N/A
Food Distributors Consumer Staples -1.10% -1.57% +9.85% N/A
Homebuilding Consumer Discretionary -1.09% -5.08% -3.32% N/A
Aerospace & Defense Industrials -1.07% +0.01% -1.05% N/A
Factors & Style
Factor Tape
What's working in cross-section.
Momentum > Value indicates trend-followers winning. Min Vol/Quality outperforming = defensive rotation. High Beta > Low Beta = risk appetite returning.
Momentum
+0.39%
5d +1.49% · QTD +16.25% · YTD +12.91%
Value
+0.74%
5d +3.68% · QTD +16.27% · YTD +21.31%
Growth
+0.83%
5d +0.73% · QTD +13.95% · YTD +3.60%
Quality
-0.04%
5d -0.12% · QTD +7.46% · YTD +4.22%
Min Vol
-0.06%
5d +0.53% · QTD +2.06% · YTD +1.41%
Size
-0.14%
5d +0.47% · QTD +6.60% · YTD +5.04%
High Beta
+0.56%
5d +0.45% · QTD +15.47% · YTD +13.91%
Low Vol
-0.44%
5d +0.54% · QTD +1.32% · YTD +4.91%
Market Internals
Breadth, Highs/Lows, Cross Events
Health checks for the underlying tape.
Breadth and 52-week-extreme counts reveal whether the rally is broad or narrow. Cross-event counts show where regime change is brewing — clusters of golden crosses signal a bottom forming, death-cross clusters warn of distribution.
52-week highs
129
Near highs (within 1%): 14
DOCN · ON · AEIS · FTV · FLEX · AIT · DTE · EME
52-week lows
53
Near lows (within 1%): 3
MKTX · CHTR · NVR · ZBH · AMCR · MRSH · G · RMD
Stock golden crosses
9
Death crosses: 20
CARR · EXPE · SBAC · CHH · PVH · UNM · AOSL · RDN
Stock 200d reclaims
61
Lost 200d: 65
AIG · APO · ACGL · AVB · CPT · CI · CRH · DDOG
Quant Pulse
Crowdedness & Leadership
How concentrated is today's leadership?
High crowdedness + concentrated sector exposure = vulnerable to mean reversion. Diverse leadership across sectors = healthier trend.
Top sector in breakouts
Unknown
100.0% of qualifying setups
Sector concentration (HHI)
10000
< 1500 = diverse · 1500-2500 = moderate · > 2500 = concentrated
Persistent leaders (3+ days)
13
Names locked in the top 15 for ≥3 sessions
What's next
Catalysts ahead
Macro releases and events on the runway over the next several sessions.
May 04
BOC Gov Macklem Speaks
Forecast: | Prior:
May 05
Cash Rate
Forecast: 4.35% | Prior: 4.10%
May 05
RBA Monetary Policy Statement
Forecast: | Prior:
May 05
RBA Rate Statement
Forecast: | Prior:
May 05
RBA Press Conference
Forecast: | Prior:
May 05
CPI m/m
Forecast: 0.3% | Prior: 0.2%
May 05
ECB President Lagarde Speaks
Forecast: | Prior:
May 05
ISM Services PMI
Forecast: 53.8 | Prior: 54.0
May 05
JOLTS Job Openings
Forecast: 6.87M | Prior: 6.88M
May 05
New Home Sales
Forecast: 668K | Prior:
May 05
Employment Change q/q
Forecast: 0.3% | Prior: 0.5%
May 05
Unemployment Rate
Forecast: 5.4% | Prior: 5.4%
May 05
RBNZ Gov Breman Speaks
Forecast: | Prior:
May 06
ADP Non-Farm Employment Change
Forecast: 90K | Prior: 62K