While the cap-weighted S&P remains rangebound as leadership at the top has stalled, the equal-weighted index continued to make new all-time highs in February, which along with gains from small caps and international suggests a broadening out of this bull market. While volatility around the conflict in Iran appears to be weighing on sentiment in the preliminary stages, for now a strong uptrend remains intact, and our Technical Dial stays Positive. 

We got our first look at Q4 GDP in February, which showed weaker than expected growth, likely due in part to the lengthy government shutdown. Most concerning is that real disposable income was flat for the second consecutive quarter, suggesting that the average American is treading water at best. As the threat of a protracted war in Iran threatens to derail an already fragile global economy, our Economic Dial remains in a Negative position. 

Walmart became the latest stock to pass $1 trillion in market cap, doing so at a valuation that is more expensive than all but one of the “Magnificent 7” stocks. As traditionally steady dividend payers get repriced for exponential growth expectations, caution is warranted, and as such, our Valuation Dial remains Negative.