Our indicators support maintaining benchmark equity exposure while remaining selective. Strong earnings and firmer employment underpin growth, but inflation and potential Fed tightening constrain valuations. Sector leadership is shifting toward Health Care, Consumer Staples, Financials, and Materials, while Technology and Energy face weaker participation.

We remain invested, with a selective approach and clear risk controls. Strong earnings and broader participation beyond technology support equities, while relatively contained credit spreads suggest the recent decline remains orderly. Inflation, elevated borrowing costs, and the cash demands of AI spending warrant caution. Our Catastrophic Stop Model remains above its sell threshold.

We remain invested, but selective as market support weakens. The Catastrophic Stop Model fell to 45.45%, with reduced exposure triggered below 40% for two consecutive days. Strong earnings, excessive pessimism, and rotation beyond Technology provide support, while softer breadth and slowing earnings upgrades warrant caution.

The evidence continues to support remaining invested, with caution. The Catastrophic Stop Model improved to 59.09%, and the high-yield bond breadth factor returned to a buy signal. However, Technology’s sharp decline shows how quickly strong earnings expectations can collide with concerns about valuations and financing.

The Day Hagan Catastrophic Stop declined to 54.55% from 59.09% last week. The evidence supports remaining invested, but caution is increasing. Our Catastrophic Stop Model remains above its sell threshold, while weakening stock and high-yield bond participation signal deterioration.

The Day Hagan Catastrophic Stop Model rose to 59.09% from 50.0% last week as the Daily Market Sentiment Composite rebounded from extreme pessimism (see the second chart below). The model continues to support benchmark-level equity exposure.

The Day Hagan Catastrophic Stop Model held steady at 50.0%. The model continues to support benchmark-level equity exposure.

The DH Catastrophic Stop Model declined to 50.0% from 54.55% last week, signaling further deterioration in equity-market and high-yield bond breadth. The weakening trend warrants caution, but the model remains above its sell threshold. A reading below 40% for two consecutive days would prompt us to raise cash. Until that occurs, the model continues to support benchmark-level equity exposure.

The Day Hagan Catastrophic Stop Model declined to 54.55% from 59.09% last week, reflecting deterioration in equity-market breadth, as shown below. The weakening deserves attention, but the model remains comfortably above its defensive threshold and continues to support benchmark-level equity exposure.

The Day Hagan Catastrophic Stop Model declined to 59.09% from 68.18% last week due to the High-Yield Bond Breadth indicator moving back to a sell signal. Overall, the model continues to support benchmark-level equity exposure.

The Day Hagan Catastrophic Stop Model held steady at 68.18%. Overall, the model continues to support benchmark-level equity exposure.

The Day Hagan Catastrophic Stop Model held steady at 68.18%. Overall, the model continues to support benchmark-level equity exposure.

The Day Hagan Catastrophic Stop Model improved to 68.18% as the U.S. Corporate High-Yield Bond OAS (option-adjusted spread) factor declined (meaning spreads narrowed), generating a buy signal for equities. Overall, the model continues to support benchmark-level equity exposure.

The Day Hagan Catastrophic Stop Model improved to 63.64% as the High-Yield Bond Breadth Factor reversed from oversold territory, reinforcing the model’s continued support for benchmark-level equity exposure.

The Catastrophic Stop model continues to support benchmark equity exposure. The message is participation with a seat belt: remain invested while respecting the model’s clearly defined risk boundary. A reading below 40% for two consecutive days would shift the evidence toward defense.

The Day Hagan Catastrophic Stop model held steady at 59.09%. The model continues to indicate that investors should maintain their benchmark equity allocation.

The Day Hagan Catastrophic Stop model held steady at 59.09%. The model continues to indicate that investors should maintain their benchmark equity allocation.

The Day Hagan Catastrophic Stop model declined to 59.09% as the Stock/Bond Relative Trend Factor turned negative. The model continues to indicate that investors should maintain their benchmark equity allocation.

The Day Hagan Catastrophic Stop model remained at 68.18%. The model continues to indicate that investors should maintain their benchmark equity allocation.

The Day Hagan Catastrophic Stop model declined to 68.18%. The model continues to indicate that investors should maintain their benchmark equity allocation.