The midterms-fueled rotation continued (SPX -0.1%, NDX -0.7%), with economically sensitive and consumer names outperform…
The midterms-fueled rotation continued (SPX -0.1%, NDX -0.7%), with economically sensitive and consumer names outperforming chipmakers. Brent rose +1.3% to $96/bbl after yesterday’s 8% drop; the 10-year yield eased to 4.87%. The rotation in Asia was even more extreme, with Samsung and SK Hynix falling over 7% on post-Democratic data-center regulation fears. Tech was mixed ($NVIDIA(NVDA.US) flat; $Micron Tech(MU.US), $Marvell Tech(MRVL.US), $Dell Tech(DELL.US) down; $Alphabet - C(GOOG.US), $Meta Platforms(META.US) up) and Musk-led names retreated further ($Tesla(TSLA.US) -1.7%, $SpaceX(SPCX.US) -1.1%) following Dems’ midterm sweep. Robust 2026 S&P EPS estimates (+33% to $369) imply a 20.8x P/E (4.8% yield, just below Treasury yields), with further yield declines expected as the Iran war ends. We remain cautious on $Tesla(TSLA.US) given its 220x 2026 P/E (PEG 5.0x) amid continued commoditization of autonomy and persistent negative revisions.
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