US Equities Weekly Rundown 8 21 26

US Equities Weekly Rundown Global Banking & Markets August 21, 2026 Positioning, Flows, and Observations Across the Floor

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Portfolio Manager’s Summary US stocks rose on Friday though the S&P 500 still fell -1.4% on the week as investors digest the implications of rising long-term bond yields, a decidedly mixed batch of consumer earnings, high energy prices, and US policy uncertainty. Bitcoin Sensitive, Goldminers, and BioProcessing were among the themes that outperformed, while NeoClouds, Drones, and IPPs were among the themes that logged the largest losses. ▪ Prime: After consistently buying US equities since late July, HFs reversed course this week and unloaded US stocks at the fastest pace since the week of Liberation Day, driven by long-and-short sales across Single Stocks and Macro Products. US L/S Net leverage fell -3 pts – the largest weekly decline in ~5 months – to 48.3% (1-year low). 9 of 11 sectors were net sold, led by Info Tech, Industrials, Utilities, and Healthcare. As long- term bond yields continued pushing higher, both Utilities and Real Estate (“bond proxies”) were net sold every day this week, driven by short sales. ▪ Shares: Themes of the week:1) Momentum drawdown against a ‘calm’ SPX & VIX backdrop. 2) Rates move remains in focus post the treasury announcement. While this may relieve some of the worries about excessive long-end issuance, it likely doesn’t address the fundamental issues driving the curve steepening/cheapening in long end. 3) Consumer remains challenged. 4) Crypto sensitive stocks saw an impressive rally on continued market structure optimism / positioning. 5) Desk flows remain benign from Asset Mgr and HF cohorts on the heels of August trading. ▪ Futures: Longer dated interest rates fell midweek following the Treasury announcement, though did not continue their decline later in the week at the time of writing. CTA/trend followers are short a meaningful amount of bonds based on our estimates, around multi-year lows or $155mm DV01 globally and with signals negative for some time. The current baseline flows scenario is close to neutral, with length short and signals negative, and if markets sold off more, we do not estimate continued notable sales. If they rallied, however we do estimate some potential notable covering and repurchasing, totaling $150mm DV01 in a month for example if prices rallied 2x std-deviations during that time. ▪ Derivatives: The broader index failed to capture the aggressive moves seen under the hood this week. Bitcoin and gold were the major focus as we saw call volumes explode particularly in IBIT. As macro and economic fears persist, we have seen investors reach for GLD optionality as a hedge. The desk has favored worst of SPX/GLD/IBIT calls as an attractive way to capture upside with a significant correlation discount. On the single stock level, collars and risk reversals continue to screen attractive given normalized put-call skew for the average single stock in the S&P is still exceptionally flat. For these structures, we have seen a recent tilt towards both Financials and Energy (XLF, XOM, BAC, WFC, GEV, etc.). ▪ Baskets: This week’s selloff in High Beta Momentum (GSPRHIMO) underscores how reactive the factor is relative to SPX & SPXXAI and how extreme factor volatility remains relative to index volatility. In addition, the underlying composition of momentum is…