It’s not just the economy that’s breaking into a K-shape: The stock market has been K-shaped this year too.
Early week trading days have delivered far higher returns than the last two days of the week:
Your thoughts on the market are likely based on the day of the week, given the
variation in average daily return. (Source: Carson)
Stocks have developed a habit of selling off into the weekend before rebounding this year.
One big explanation might be that traders don’t want to be leveraged going into two days where the market’s closed in New York – but stay open online.
Any random Trump tweet can and has moved the market!
Ostensibly, if the weekend is quiet, stocks can recoup their Thursday/Friday declines.
Whatever happens, if you’ve been following our guidance to “panic now and avoid the rush,” you should already be comfortable even with the market’s sharp move lower yesterday.
~ Addison
P.S. Yesterday’s call on Grey Swan Live! with Andrew Zatlin — the #1-ranked economic forecaster on Bloomberg – covered much of the fear rippling through markets today.
While the government closure is over, the real challenge now is in economic data – or the lack thereof. That’s increasing the chances of a Fed pause in lowering interest rates in December, which in turn is sending asset prices lower.
With the December rate cut in limbo, we still see a bigger push to lower interest rates in early 2026 – designed to juice the economy and stock market into the midterms.
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