Drilling down into variables – one can readily see the market challenges; which go way beyond simplicity expectations of a late year rally. That’s not at all out of the question as I’ve noted before; but how we get there (if at all) varies upon the two most obvious issues that remain unresolved. (Midterm Elections; the implications therefrom; and of course trading with China.)  

The chart behavior we’ve shown gave a good picture of how uncertainty has or will roil this market; and how it can defy orthodox seasonal expectations. I am not talking about Apple (a trigger for generalized worries about growth in a slower nature, not just for the Cupertino darling, but for tech in-general).

Sure, it alone can move markets (because at 5% of S&P total capitalization it has outsized impact); nor do I refer solely to in-place buyback programs, that can turn slow-growth into yet-higher earnings growth (again, artificial ways of window-dressing a stock’s results while at the same time enhancing executive compensation via keep share prices at a higher level than they might otherwise command).  

I’m addressing variables that a slower-growth (even if we don’t get an immense blue-wave) environment can have on valuations; and whether or not 2018’s persistent internal corrections (rolling bear market / ‘Rinse & Repeat’ style) I outlined from the initial ‘crash alert’ in late January; before the Feb. break, in a broad way are sufficient.  

I think maybe; for many smaller-cap stocks, and a slew of major industrial companies that soared on Trump’s win; then gave a lot (or more) back this year; as the excessive optimism unwound long after optimum entry points back in November of 2016, as we enthusiastically called for (a ‘to the Moon if Trump wins’ outlook). January’s ‘top’ call highlighted ‘not interstellar space’ as you know; and outlined the rotating ‘high-wealth’ exodus all year.