JD Durkin: Eric Criscuolo, good friend of the show, is a very good friend of mine as well. He is Market Strategist here at the Big Board. My man, thank you for being here today.
Eric Criscuolo: Professional broadcaster, handling that stuff. That was fantastic.
JD Durkin: No, we just, like, think the goal is to make sure that they don’t know what happens watching at home. But I can only do so much, as can the bond market. Only do so much. Another spike today, 30-year, 10-year. Talk to me about what you’re seeing off of those instruments as potential pressure points on equities.
Eric Criscuolo: It’s been the same situation for a while now. Yields have just been pressing higher and higher and higher. Oil’s helping that, of course. And, you know, equities have had to kind of navigate that rise in rates.
We’re up like 70 basis points, I think, over the past, you know, couple of months. So it’s pressuring equities. But the S&P 500 has managed to stay in that 7,800, 7,600 pocket that we’ve been talking about, and it just hasn’t cracked.
However, the equal-weight index, so all the other stocks, right, if you take everything equally, that’s starting to turn down a little bit now. So, you know, some of the non-majors, the non-mega-caps, those are kind of coming under more pressure now as that higher interest-rate environment has just weighed on them and weighed on them and weighed on them.
But quarter-end, month-end, we’ll see. Could flip things around. There could be a lot of positioning changes. Again, you know, some of the portfolio balances, right? Equities stayed the same, bonds sold off. So some funds are going to have to buy bonds now because they’re underweight them, maybe sell some equities on the top side.
We’ll have to see, though, because all of those flows you can try to model out. It’s very hard to predict.
JD Durkin: Yeah, fascinating market and portfolio allocation notes there. I know that the rest of us would know to pay attention to, Marco.
Eric Criscuolo: No, no.
JD Durkin: And that’s really good. I appreciate that context. Tomorrow after the bell, Micron. You know, we kind of got past the heart of earnings season, but this is the sort of day, the type of week, we’re reminded we’ve got a few really big dogs, especially to the broader AI trade, still to report. How important is a name like MU in the broader AI ecosystem?
Eric Criscuolo: We talked about the mega-caps. We just said it’s keeping the index up overall while everything else is kind of weakening. Micron, obviously a huge player in that, huge in the AI trade.
What they say is going to be very closely followed, closely watched. You know, every other AI company has basically said things are on fire. Probably everyone is thinking they’re going to say the same thing. Demand is through the roof. You know, they’re raising prices. That trade is going to continue.
But the devil is in the details. I really don’t know what management’s going to say, but it’s probably going to be very bullish for the AI trade in general.
JD Durkin: I don’t know how much you’ve followed this, the Conference Board’s latest consumer confidence figures. We got those out today. They show consumer confidence taking quite a dip, maybe understandably so, in the month of September, on the backdrop of a lot of uncertainty for people, both about what we call their present situation, how you’re feeling today, as well as your kind of future projections.
How important is the soft data? I know you tend to be more of a hard-data guy, but it does tell an interesting story, maybe about consumer spending and other parts underneath the surface.
Eric Criscuolo: Yeah. I mean, consumer spending has held up the economy. It’s one of the reasons why GDP and the economy has held up. Consumers just keep on spending.
They’ve been under pressure for years, though. Inflation, now election season coming up, so not surprising that consumer confidence would maybe be volatile here. One month does not make a trend. Definitely something to look forward to, or to keep track of, as we go forward.
Does the consumer finally crack? So far, they have not. If you checked out Carnival’s results, very strong results. They actually raised guidance. Everyone’s still cruising, apparently. So, you know, not a pullback yet that we see for the consumer. Spending remains to be seen.
JD Durkin: Yeah. And, of course, I’m out of time. But we’ve got ADP tomorrow, which I, you know, maybe take with a bit of a grain of salt, but sets the stage for the big one Friday, September jobs report print. That’s going to be a big print.
And I hope you’ll come back and see us for that big print or any others in the near future. Nice to see you here.
Eric Criscuolo: Anytime, JD. Always a pleasure.
JD Durkin: Eric Criscuolo, Market Strategist here at the NYSE. My man, we’ll talk again soon.
