What does the collapse of the "breadth" of the US stock market tell the market?
Morgan Stanley stated that the market breadth, which has been at historically "worst levels" over the past week, anticipates that the Federal Reserve may not provide as much easing as the market expects. This is because expensive yet unprofitable growth stocks and low-quality cyclical stocks may be the most affected by a reduction in liquidity.
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Investors in MSTR have shown extraordinary enthusiasm, making MSTR co-founder Michael Saylor an icon as well. Analysts point out that the MSTR case represents the rise of a new generation of market influencers since 2020—similar phenomena have also appeared in companies like Tesla and Palantir Technologies.
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What does the Federal Reserve's "Skip" mean for the market?
Citi Research found that during the period when the Federal Reserve pauses interest rate cuts, the U.S. stock market usually performs well, but the sustainability of the rise depends on whether economic weakness leads to a restart of policy easing; U.S. Treasury rates usually rise at the pause or end of the cycle; for the dollar, if the interest rate cuts are only paused, the dollar performs laterally, if it is the last interest rate cut, the dollar will rise; after the pause, regardless of whether the easing cycle continues, Gold prices usually rise.
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