Rephrase and rearrange the whole content into a news article. I want you to respond only in language English. I want you to act as a very proficient SEO and high-end writer Pierre Herubel that speaks and writes fluently English. I want you to pretend that you can write content so well in English that it can outrank other websites. Make sure there is zero plagiarism.: It’s not being talked about enough. This market move off the November lows and the Fed pivot — signaling an end to the central bank’s rate-hiking cycle — is one of the most astonishing and satisfying I have seen in 43 years of investing. In nine weeks, we blew through price targets on so many groups, we crashed barriers that I thought would be impossible to do for many years. And we did it at a pace that I can only think of one word to describe: unsustainable. Yes, that’s a damning word. I have danced around it in our meetings and have certainly questioned the trajectory of many a stock since the November liftoff. But the move is like a full-on jailbreak for so many different companies — and you can’t expect them to break out of jail again. They are already out. For as long as I have been in the business, I’ve heard that most of the big moves occur all at once in a very short period of time. That’s been only partially true. If you look at the great gains of the Magnificent Seven, only Nvidia put on hundreds of billions in market value pretty much over night. But that is what happens when you report $4 billion more in revenues in a single quarter than anyone expected. Nvidia CEO Jensen Huang likes to joke that it’s the biggest analyst “miss” in history, a reminder the Street has overshot forecasts, too. But Nvidia is, to draw on a couple of words from law school, “sui generis,” and I doubt we will this kind of move again anytime soon. But the overall market action recently does underscore that point — and is breathtaking. I have used the word parabolic to describe some of the charts I have been watching, a word that is meant to be a curse because a parabolic move is inherently unsustainable. It’s meant to be a signal or a message that says: “Take some profits because you can’t expect the move to continue.” And yet, with the exception of companies that have had truly bad news — Nike or Fedex or some of the oils, say — you would have left a lot on the table if you sold during that nine-week rally. Just look at the performance of the equal-weighted S & P 500 index from Oct. 23 — the day long-term interest rates peaked — to the end of 2023: Up a whopping 15%. Even the much-maligned Magnificent Seven put on 11%. So much for the paltry performance of the mega-cap tech stocks. We began 2024 by trimming our biggest winners — a decision based on discipline, which must trump conviction for long-term success. Bulls make money, bears make money, and hogs get slaughtered. We didn’t want to be greedy hogs after the great year these stocks had. A lot of that extends from the parabolic proposition. Look at many of the stock charts: where we are now versus the end of October is almost nonsensical. You are very far from terra firma. Lots of my trepidation actually comes from the calendar of earnings versus the Fed calendar of meetings. Going into the first week of November, we had seen a huge number of quarterly reports and we found them wanting. These companies would most certainly miss their fourth-quarter expectations if the Fed maintained its higher-for-longer status. Most stocks were being priced like we would have a recession. Soaring sectors since the pivot I could go over tons of groups that were like that. But let’s focus on the ones that have really ripped here: financials, healthcare, homebuilders, foods and retail. These really took off, not the industrials or techs or the entertainment and travel and leisure, unless they were related to credit card companies like American Express . We knew how badly the financials and the retailers were going to be going into the Fed pivot. We would have huge credit losses for banks and the retailers were going to run into a weakened consumer who was tapped out. Of course, once the Fed scrapped keeping interest rates higher for longer, market participants mostly adopted a view that we would have a procession of rate cuts. After all, the Fed would not have ditched higher for longer if something was wrong. Here’s where it gets interesting and complicated, even murky, going into earnings next week. Buyers bid up pretty much everything — but especially these sectors — without having any understanding of whether the companies are actually doing better. We had made up our minds how tough this market was going to be Just when the Fed said it had accomplished what it wanted to. Now cuts, not hikes, were next. That means we are heading into an earnings period where stocks have gone up pretty much unnaturally and in lockstep. When you consider the moves in the financials, whether it’s JPMorgan , Capital One , Allstate or Travelers , they all took place during this contained period and yet we have no idea how they are actually doing. Look at American Express, a company I like very much. The company’s last public comment going into this nine-week rocket ship was that October was a little weaker than planned. And then it puts on twenty points in a straight, yes parabolic, line and it happens so fast that the analysts don’t even get to be positive or adjust their price targets. Or Morgan Stanley , a long-time Club name. It reported a quarter that we stood by but few others did because the bank did put on a rather tepid display of wealth accumulation. The stock goes down to $70, yielding more than 4%. Then you look up nine weeks later and — based on those same quarterly results with no new data or information — it’s at $94. We have to ask ourselves: Did it deserve to go to $70? The answer is obvious: no. But does it deserve to be at $94? On a yield basis: yes. But if it didn’t get wealth management back on track, we will regret that we didn’t sell some. Believe me, it is tempting. But I actually think the last quarter was a fluke and I don’t want to trim our already small position. I feel the same way about Wells Fargo . Like so many of the other banks, you got the equivalent of a year’s worth of a move in nine weeks that’s being justified only by the Fed pivot. The moves are based on rubber. They are about to hit the road at the end of this week and I regard that as worrisome. Oddly, the stronger employment number on Friday actually helped these stocks because the real risk is a big spike in unemployment. That’s something you could logically infer from the Fed’s now radical switch, and it would make this whole move in national banks, credit cards, regional banks and insurers totally hazardous. Fortunately, even after this run the price-to-earnings multiples are low and have been low. Unfortunately analysts have to deal with models and the models are not going to justify the run from October. That’s why I am so concerned. Can American Express say things that justify the move after saying not long ago that things are sluggish? Or has the stock been so chronically undervalued because people thought rates were headed to six and now they aren’t? The pivot from going up to 6% to back down to 4% is of such a magnitude that it makes sense for stocks to have a U-turn. However, that U-turn was propelled into overdrive by the entire financial group moving together. All I can say is that these numbers better be spectacular or you can expect a sharp rollback. Yet, I don’t see how bountiful the numbers really can be? Worrisome. You want parabolic? Have you seen the move in the forgotten retailers like Gap , Abercrombie & Fitch , Ross…
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