📈 Market Rotation

CPI caused a significant shift in the market.

Market Rotation

CPI came out on Thursday and shocked everyone with inflation weakening at a rate greater than anyone anticipated.

Because of this, we can now expect rate cuts in September, as Powell has repeatedly said additional positive data relating to inflation is what he needs to see before deciding to cut rates.

FedWatch (above) tells us that we have a 90% chance of seeing a rate cut in September now.

Stocks to Target

With rate cuts imminent, we now need to look at stocks that will benefit from rate cuts.

The key sectors I will be focusing on are regional banks, REITs, homebuilders, and specific stocks that benefit from lower rates.

DPST is the regional banks 3x ETF and is poised for a move higher.

Within REITs, you see NYC office space making a significant move. I am watching SLG and VNO closely.

Finally, homebuilders benefit from rate cuts and are already seeing a breakout with more room to run.

In the video below, I outline my thesis around rate cuts and which stocks benefit the most.