JPM JPM US Market Intell

IDEAS & INSIGHTS – IN BRIEF • US MKT INTEL VIEW – Tactically Bullish and we update the Monetization Menu • ADDITIONAL THOUGHTS – Earnings Update, Fed Preview, Flash PMI review, Rates, Seasonality, and Tariffs • POSITIONING INTELLIGENCE – Weekly Wrap | TPM hits "Attractive" Signal Into Earnings; HFs Fade Mag7 While Covering Shorts Elsewhere • COMPARISONS TO 2008: MACRO, CREDIT, AND EQUITY SECTORS – the TL; DR is No, today is not similar to 2008, economically; though, AI poses broad risks to Equities and Credit. • ENERGY UPDATES – Ellen gives the latest updates and ramifications for Equities

JPM MARKET INTEL MORNING UPDATES • SPX +0.9%, NDX +1.5%, RTY +1.3%. WTI -727bps at $82.82, NatGas -439bps to $2.75, UK NatGas -798bps to £1.4181, Gold +96bps to $4,092, Silver +184bps to $59.25, 10Y @ 4.635%, and VIX @ 17.66. • US: Futures are higher with NDX and RTY outperforming. The pause in MidEast hostilities is the driver as oil prices collapse, bond yields and USD are lower. The market may be setting up for a bounce; Positioning Intel team’s Tactical Positioning Monitor flashed a Buy signal with the latest pullback. Watch for a decline in Fed hike pricing as another tailwind for risk assets. Pre-mkt, yields are down 3-4bp as DXY is poised for its worst move in two wks. Cmdtys are being dragged by Energy / Ags with bids in Metals, where Precious is leading Base. In Eqys, Semis are bid with Mag7 pushing higher with 6 of 7 names up at least 1%, pre-mkt. Energy / Staples will start the session in the red but today is setting up as an ‘Everything Rally’. Today’s macro data focus is on Durable / Cap Goods plus Fed regional activity indicators. • EU/UK: Major markets are all higher led by Germany and Spain with UK the laggard. German Business Climate printed above surveyed numbers. Regional yields are dragged lower with weaker energy prices. Software, AI Disruption, and Luxury are among the top baskets with Energy the notable laggard. Momentum Shorts are being covered with Momentum Longs lagging indices pointing

to de-risking into central banks and earnings. Thematically, Beta / Cyclicals are leading, ResVol / Momentum are lagging. UKX +0.4%, SX5E +1.2%, SXXP +0.7%, DAX +1.5%. CSI +1.1%, HSI +1.0%, NKY +0.5%, ASX +1.4%, KOSPI +1.0%.

CATALYSTS TODAY (WEEK AHEAD) • US MACRO DATA: Durable Goods / Cap Goods at 8.30am ET. Dallas Fed at 10.30am ET.

• US EARNINGS: AMKR, APLD, BRO, ESI, NUE, NVTS, RMBS, UHS, WELL, WHR

• GLOBAL MACRO DATA: Eurozone - Money Supply. Germany - IFO Business Climate

JPM MARKET INTEL EQUITY & MACRO NARRATIVE Last week, SPX fell 61bp, with both NDX (-1.6%) and RTY (-1.1) lagging. SOXX added 1.2%, SPW outperformed SPX by 67bp, KOSPI printed its 5th consecutive weekly decline, and Europe / UK led the US as did Latam (MXLA). We enter this week trying to understand the direction of AI / Semis / Tech amid the heaviest SPX reporting week, global central bank meetings, and renewed negotiations in the Middle East where a new kinetic front began in the Red Sea.

We remain Tactically Bullish. Our colleagues in Positioning Intel tell us that their Tactical Positioning Monitor is now flashing a buy-signal, which has historically meant material upside for the SPX, but they do caution on crowded positioning, especially in Semis, and uncertainty from AI and Middle East as near-term challenges. We see near-term tailwinds come from (i) lower bond yields, (ii) weaker USD, (iii) continued earnings delivery, and (iv) reduced vol. These tailwinds are driven by a decrease in kinetic hostilities in the Middle East and a hold by the Fed.

SPX vs. NOMINAL GDP vs. REAL GDP