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Healthcare Re-Enters the Top 5

After a wild week in the markets, the sector ranking got quite a shake-up. Although only one sector changed in the top 5, the entire top 5 changed positions. In the bottom half of the ranking, only two sectors remained stationary.

The Healthcare sector re-entered the top 5 after dropping out two weeks earlier. This happened at the expense of Energy, which dropped to #7. Consumer Staples jumped from the #4 position and is now leading, followed by Utilities. Financials and Communication Services dropped to #4 and #5, down from #1 and #2.

In the bottom half, Real-Estate jumped to #6 from #9. Energy, dropping from the top 5, is now at #7, and pushed Industrials and Consumer Discretionary down to #8 and #9.

Materials and Technology remain on positions #10 and #11.

  1. (4) Consumer Staples – (XLP)*
  2. (5) Utilities – (XLU)*
  3. (1) Financials – (XLF)*
  4. (2) Communication Services – (XLC)*
  5. (6) Healthcare – (XLV)*
  6. (9) Real-Estate – (XLRE)*
  7. (3) Energy – (XLE)*
  8. (7) Industrials – (XLI)*
  9. (8) Consumer Discretionary – (XLY)*
  10. (10) Materials – (XLB)
  11. (11) Technology – (XLK)

Weekly RRG: Strong Tails for XLU and XLP

On the weekly RRG, Financials and Communication services remain at high JdK RS-Ratio levels, but have started to roll over while still inside the leading quadrant.

XLV dropped on the JdK RS-Momentum axis, but is still moving higher on RS-Ratio. The two strongest tails are for XLP and XLU, which are pushing further into leading at positive RRG-Headings.

Daily RRG: Communication Services Drops into Lagging

On the daily RRG, XLP and XLU are starting to lose relative momentum, but it is happening at high RS-Ratio levels. This is combined with the strong weekly tails, which keep both sectors comfortably in the top 5.

XLV and XLF are rotating through the weekly quadrant, while XLC has crossed over into lagging.

Consumer Staples

XLP dipped back to support near 75, but recovered strongly back into its previous range. As a result, the raw RS-Line is challenging its overhead resistance, dragging both RRG-Lines sharply higher. This is now clearly the strongest sector.

Utilities

During the week, XLU dropped below support but managed to come back within the range at Friday’s close. Just like Staples, raw RS is about to break its upper boundary, away from its range. Both RRG-Lines are accelerating higher, pushing the tail deeper into leading.

Financials

XLF tested support around 42, but the bounce stopped near its old support level of around 47.50. RS has steadily moved higher within the boundaries of its rising channel.

Communication Services

A big price drop was caught just above horizontal support near 83. The recovery, so far, has not reached overhead resistance at 95, the old support level. This makes XLC the most vulnerable sector inside the top 5. Relative strength remains stable at high RS-Ratio readings and flat RS-Momentum.

Healthcare

The Healthcare sector re-entered the top 5 after one week of absence. This brings all three defensive sectors back into the RRG portfolio. On the price chart, XLV is battling with the former horizontal support area, now resistance, around 136. Relative strength continues to rise, putting the XLV tail well inside the leading quadrant.

Portfolio Performance Update

Last week’s volatility was a bit too much for the portfolio to keep up with, and it is now lagging the S&P 500 by almost 2%.

#StayAlert –Julius


The market has been overvalued for some time but how overvalued is it? Today Carl brings his earnings chart to demonstrate how overvalued the market is right now. We have the final data for Q4 2024.

The market continues to show high volatility but it did calm down somewhat Monday. Carl reviews the market charts you need to see going into this week. He covered not only the market in general, but also covered Bitcoin, Yields, Bonds, Dollar, Gold, Crude Oil and more.

After his market overview, Carl walked us through both the daily and weekly charts of the Magnificent Seven to determine if there is any strength visible. Clue: Not much.

After his review of the Mag 7, Carl discussed Altria (MO) and his strategy to buy high dividend stocks like this one after the market finishes declining from this bear market or beyond. He’s looking for a 50% drawdown eventually.

Erin then took over to talk about sector rotation. Defensive groups are leading as we would expect with Technology trying to stage a comeback. Erin dives into these sectors under the hood to determine participation readings and the ability of them to continue to rally.

Next up Carl brought out his earnings chart to discuss how overvalued the market currently is. He shows his estimates for future movement and discusses where we are right now.

The pair finished the program with a look at viewers’ symbol requests.

00:58 DP Scoreboards

03:33 Market Overview

15:26 Magnificent Seven

20:56 Dividend Discussion

23:34 Sector Rotation

33:29 Earnings Chart

36:41 Questions

40:13 Symbol Requests


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Bear Market Rules


One of my favorite market breadth indicators remained in an extreme bearish reading through the end of last week, standing in stark contrast to growing optimism after last Wednesday’s sudden spike higher.  Monday’s session saw the Bullish Percent Indexes cross above the crucial 30% level for both the S&P 500 and Nasdaq 100.  While I remain skeptical of meaningful upside without further confirmation, this bullish rotation does seem to confirm a short-term tactical rally for stocks.

Bullish Percent Index Shows Improved Breadth for S&P 500

The Bullish Percent Index uses point & figure charts to analyze the percentage of stocks in a universe that are in uptrends.  By looking at the most recent buy or sell signal on each individual point & figure chart, the indicator can help validate when a critical mass of stocks have rotated from a bearish phase to a bullish phase.

At the end of September 2024, the S&P 500 Bullish Percent Index showed a reading just above 80%.  By early December, the indicator was down to around 70%, and at the February 2025 high had reached 55%.  Last week, the S&P 500 Bullish Percent Index was just above 10%.  Indeed, almost all of the S&P 500 members were in confirmed point & figure downtrends.

Breadth Surge Similar to Previous Lows

The Bullish Percent Index for the Nasdaq 100 as well as the S&P 500 both spiked higher by the end of last week following the latest changes to US tariff policy.  As of Monday’s close the Nasdaq 100 Bullish Percent Index had reached 39%, up from 6% a week earlier. 

We can see four other times in the last two years where the Bullish Percent Index has touched the 30% level, and in three of the four times this reversal marked a significant low for the Nasdaq 100.  The most recent observation was last month, which saw a brief upswing before the latest downturn for the major equity averages.

So for both the Nasdaq 100 as well as the S&P 500, a move back above the 30% threshold appears to indicate a decent chance at a tradable move higher.  But will that upswing necessarily lead to sustainable gains?

Long-Term Review Yields Mixed Results

Let’s take a longer look back to the year 2000 and see what has happened following a move below the 30% level for the S&P 500 Bullish Percent Index.  Now we can see that while major lows often coincide with the indicator moving back above 30%, we can also see plenty of times where an initial bounce higher was eventually met with further selling.

Note the extreme low readings in June 2022, August 2015, and January 2009.  Even though there was an initial swing higher in all three cases, the market made a new swing low before achieving an eventual bottom for the bear cycle.

With the Bullish Percent Indexes rotating back to a more neutral reading this week, we are seeing plenty of signs of a tactical rally.  We may even see our Market Trend Model turn bullish on the short-term time frame as early as this Friday.  But with the major averages still making a clear pattern of lower lows and lower highs, we feel further confirmation is necessary before declaring any sort of “all clear” for US stocks.

RR#6,

Dave

PS- Ready to upgrade your investment process?  Check out my free behavioral investing course!

David Keller, CMT

President and Chief Strategist

Sierra Alpha Research LLC

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice.  The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.  

The author does not have a position in mentioned securities at the time of publication.    Any opinions expressed herein are solely those of the author and do not in any way represent the views or opinions of any other person or entity.

Voters in Ecuador are casting their ballots in a presidential runoff election between conservative incumbent Daniel Noboa and leftist lawyer Luisa González – a race overshadowed by drug-fueled violence that has consumed the once-peaceful South American country.

“Tranquility … is the most important thing for the country because there is a lot of insecurity,” one voter said.

“Security is in pieces,” another voter said, adding that she hopes whoever wins will keep their promise to tackle violence.

Polls opened at 8 a.m. ET and are scheduled to close at 6 p.m. The first results are expected to be announced a few hours after that.

This is the latest electoral contest between the two candidates. In the 2023 snap election, Noboa defeated González with just over 50 percent of the vote.

Noboa, who won a special election in 2023 to complete his predecessor’s term, is seeking a full four-year term to continue his controversial war on gangs and drug traffickers, which has so far had limited results.

The 37-year-old leader has declared numerous states of emergency, deployed military units to tackle gang activity, and began construction on a new maximum-security prison after an infamous criminal leader escaped from custody last year.

But according to figures from the government, the start to the year has seen an unprecedented level of violence with more than 1,000 homicides. Data from organized crime research center InSight Crime suggests Ecuador has the highest homicide rate in Latin America.

González, a protégé of Ecuador’s left-wing former President Rafael Correa, is offering an alternative model for security based on what her party describes as “prevention, violence reduction and coexistence.”

Running on a campaign to “Revive Ecuador,” González is also proposing a return to high social spending to help the country’s poorest citizens. She says her party represents hope and transformation, arguing that “Noboa represents fear.”

Both candidates cast their ballots on Sunday morning, with Noboa guaranteeing a victory.

“We’ll win today. Today is a very important day for Ecuador,” he said in brief remarks to the press.

González, meanwhile, promised to defend democracy as she cast her vote.

“With all the faith, the homeland … with all the conviction of serving a country. And through that change, today we will change the history of Ecuador,” she said.

This post appeared first on cnn.com

Mario Vargas Llosa, the Peruvian-Spanish Nobel Prize-winning author whose work focused on the evils of totalitarianism and who once ran for president, has died at age 89, according to his family.

“It is with deep sorrow that we announce that our father, Mario Vargas LLosa, passed away peacefully in Lima today, surrounded by his family,” said a family statement shared by his son Álvaro Vargas Llosa on X on Sunday.

Vargas Llosa will be best remembered for novels including “Conversation in the Cathedral” (1969), “The War of the End of the World” (1981), and “Aunt Julia and the Scriptwriter” (1977), which was adapted for the 1990 feature film “Tune in Tomorrow,” starring Barbara Hershey and Keanu Reeves.

In 2010, Vargas Llosa was awarded the Nobel Prize in Literature for what the Swedish academy called “his cartography of structures of power and his trenchant images of the individual’s resistance, revolt, and defeat.”

In their statement Sunday, the novelist’s three children said Vargas Llosa’s “departure will sadden his relatives, his friends and his readers around the world.”

“But we hope that they will find comfort, as we do, in the fact that he enjoyed a long, adventurous and fruitful life, and leaves behind him a body of work that will outlive him,” they said.

Vargas Llosa will be farewelled by his family and close friends at a private event, the statement added.

Born in Arequipa, southern Peru, Vargas Llosa spent his early years in Cochabamba, Bolivia, where his grandfather was the Peruvian consul, before attending a military school and the National University of San Marcos in the Peruvian capital Lima.

By 1952 he had published his first work, a play called “La guide del Inca,” and he soon became a regular contributor to the Peruvian literary press.

Vargas Llosa worked as a journalist and broadcaster, and attended the University of Madrid before moving to Paris.

In 1963 he published his first novel, “La ciudad y los perros” – known in English as “The Time of the Hero” – to wide acclaim. It was eventually translated into more than a dozen languages. It was followed by novels including “The Green House” (1966) and “Captain Pantoja and the Special Service” (1973).

After stints in London, where he lectured at King’s College; the United States, where he spent a year as writer in residence at Washington State University; and Barcelona, he moved back to Lima in 1974. A translated collection of his essays was published in English in 1978.

In 1990, Vargas Llosa ran for president of Peru, on a platform of what he called classical liberalism – a belief in individual initiative, free from interference by the state.

After losing the election to outsider candidate Alberto Fujimori in a second-round landslide, he moved to Spain, becoming a Spanish citizen in 1993. He won the Cervantes Prize, a prestigious Spanish literary award, a year later.

Later novels included “The Feast of the Goat” in 2000 and “The Bad Girl” in 2006.

When Vargas Llosa was awarded the Nobel Prize in 2010, he told the organizers in an interview that he had been inspired by French writer Gustave Flaubert, “because he managed, not being a born genius, to build his genius through effort, commitment, perseverance, discipline.”

Vargas Llosa also revealed how he believed that literature and politics were linked.

“I am convinced that, for example, democratic culture, culture based on freedom, on respect of human rights, was something that was possible because we had people that were sensibilized by art, by literature, by culture in general, about the sufferance, the injustices, the inequalities, the abuses who were so extended in real life,” he said.

“So, I think literature is pleasure but it’s also a very important instrument to move forward in life.”

This story has been updated with additional information.

This post appeared first on cnn.com

New satellite images show what could be North Korea’s biggest warship ever – possibly more than double the size of anything in leader Kim Jong Un’s naval fleet.

Images taken by independent satellite providers Maxar Technologies and Planet Labs on April 6 show the ship under construction in the water at the Nampo shipyard on North Korea’s west coast, about 60 kilometers (37 miles) southwest of the capital Pyongyang.

Analysts say the pictures show ongoing construction of weapons and other internal systems of the ship, which is likely a guided-missile frigate (FFG) designed to carry missiles in vertical launch tubes for use against targets on land and sea.

“The FFG is approximately 140 meters (459 feet) long, making it the largest warship manufactured in North Korea,” an analysis by Joseph Bermudez Jr. and Jennifer Jun at the Center for Strategic and International Studies said.

For comparison, the US Navy’s Arleigh Burke-class destroyers are about 505 feet long and its under-construction Constellation-class frigates will be 496 feet long.

The existence of the warship is not a surprise.

The Kim regime has been engaged in a rapid modernization of its armed forces, developing a range of new weapons and testing intercontinental ballistic missiles that can reach almost anywhere in the United States.

It’s done that despite United Nations sanctions that have puts strict limits on its access to the materials and technology to develop those weapons.

But the closer ties with Russia since the beginning of the Ukraine war could be helping North Korea overcome that sanctions, analysts say.

Kim Duk-ki, a retired South Korean admiral, said he thinks Moscow may be providing the technology for the frigate’s missile systems.

Pictures of the vessel appeared in a report by state-run Korean Central Television released late last year on the ruling Workers’ Party’s end-of-year plenary session. The images showed leader Kim inspecting the ship’s construction.

The images shown in the KCTV video show the warship could have the kind of weaponry possessed by modern navies, including vertical launch cells that could be used to fire a variety of missiles.

Analysts also noted the ship seems to be set up to have phased-array radar, which can track threats and targets more quickly and accurately than previously displayed North Korean capabilities.

Despite those indications of advanced warfighting abilities, analysts urged caution in making assumptions.

The challenge of building warships

Almost any shipbuilder can get the hull and propulsion systems right, said Carl Schuster, a former US Navy captain and Hawaii-based analyst.

“However, modern warships represent an integration challenge of communications, electronics, weapons, and both electronic and acoustic sensor technologies” that is not so easily achieved, he said.

“Operating such a big military warship takes significant amount of budget. They not only have to build a warship, but make a team that would operate it, and it costs to operate it including the equipment and fuel. Also, one huge warship cannot go out on its own. So the question is, can North Korea afford the cost?” he said.

Kim, the retired South Korean admiral, was cautious on not underestimating what the final product may look like, especially its lethality.

“If North Korea equips the new frigate with the hypersonic ballistic missile it claimed to have successfully tested in January, that will cause a game changing impact in the regional security,” the former naval officer said.

“This ship’s construction is being delayed by the lack of the superstructure, sensor and weapons systems intended for installation,” he said.

North Korea’s aged fleet

North Korea’s navy has about 400 patrol combatants and 70 submarines, according to the most recent estimate from the US Defense Intelligence Agency (DIA) in a 2021 report.

Though that’s a large number of vessels, most of them are old and small.

Joseph Dempsey, an analyst at the International Institute for Strategic Studies, wrote in a January blog post that Pyongyang has only two principal surface combatants. Those Najin-class frigates – 1,600-ton warships dating to the early 1970s – are obsolete, he wrote.

The DIA report said the North Korean navy would largely be reduced to coastal defense in any conflict with South Korea or the United States, both of which have vastly superior naval forces.

But North Korean leader Kim has been pushing to modernize his naval fleet. It is also developing submarine-launched missiles and the subs to carry them.

In September, Kim inspected the site for a new naval port.

“Now that we are soon to possess large surface warships and submarines which cannot be anchored at the existing facilities for mooring warships, the construction of a naval base for running the latest large warships has become a pressing task,” he said at the time.

Yu Yong-won, a South Korean lawmaker, said the ship under construction at the Nampo yard is only one example of Kim trying to modernize his navy.

A nuclear-powered submarine is under construction at a shipyard in the North Korean port of Sinpo and another frigate or destroyer is in the works in Chongjin, Yu said.

This post appeared first on cnn.com

Xi Jinping has appealed to Vietnam to join China in upholding multilateral trade, as he begins a high-stakes diplomatic tour of the region’s major export-reliant economies in a bid to position his country as a stable partner in contrast to the United States.

Xi arrived in communist-ruled Vietnam on Monday and is set to visit Malaysia and Cambodia from Tuesday to Friday – countries that have seen growing trade and investment ties with China in recent years.

The trip comes just days after US President Donald Trump paused his “reciprocal” tariffs on most countries for 90 days – narrowing the focus on his trade war squarely on China.

As Washington and Beijing exchange record-high levies, Southeast Asian nations – still catching their breath from the now-suspended US tariffs – are growing increasingly anxious about being caught in the crossfire between the world’s two largest economies.

Seeking to capitalize on the turmoil unleashed by Trump’s tariff whiplash, Xi is expected to cast China as a reliable partner and defender of global trade. Vietnam and Cambodia were among the highest hit by Trump’s tariffs, set at 46% and 49% respectively before the pause.

But while countries are rolling out the red carpet for Xi, they also need to tread carefully – and avoid the appearance they are siding with China, and potentially risk provoking Trump during their own negotiations over pending tariffs.

Some are wary of being flooded with cheap Chinese goods that are now shut out of the US markets due to the sky-high tariffs. China already runs a trade surplus with Vietnam, exporting 1.6 times the value it imports from its southern neighbor.

As a bloc, the Association of Southeast Asian Nations has overtaken the US and the European Union as China’s largest export market since 2023, according to Chinese customs data.

In a signed article published Monday in Vietnam state media, Xi reiterated that there are no winners in a trade war or tariff war, and protectionism will lead nowhere.

“Our two countries should resolutely safeguard the multilateral trading system, stable global industrial and supply chains, and open and cooperative international environment,” Xi wrote, according to China’s official state news agency Xinhua.

Vietnam, a rising manufacturing powerhouse, has seen a surge in Chinese investments in recent years as manufactures move supply chains out of China to take advantage of lower labor costs and hedge against US levies. China’s trade with Vietnam nearly doubled between 2017 and 2024, making the communist state China’s biggest trade partner in Southeast Asia.

While in Hanoi, Xi is expected to further strengthen those ties. The two countries are set to sign about 40 agreements across multiple sectors – including cooperation on railways, agricultural trade and the digital and green economy, Vietnam’s Deputy Prime Minister Bui Thanh Son said on Saturday, according to Reuters.

Vietnam has approved plans to build a $8.3 billion railway linking its northern port city of Haiphong to China, which will be partially funded by Chinese loans. The country is also looking to purchase China’s homegrown mainline passenger aircraft made by Chinese state-owned planemaker COMAC.

Wen-ti Sung, a non-resident fellow at the Atlantic Council, said Xi’s high-profile visit is two pronged: economically, it’s about finding a way to diversify China’s economic footprint around the world; on the foreign policy front, it’s also aimed at pulling countries closer to China while they are unsettled by Trump’s on-and-off-again tariffs.

“What Xi is trying to do now is to go there in person. Instead of fear and pressure, Xi is going to show them love, maybe some ‘souvenirs’ along the way,” he said, referring to possible new trade deals and upgrades to their strategic partnerships.

“All these are ways for China to show that I’m on your side. It’s safe to hang out with China, especially if you’re concerned about the US.”

But relations between China and its neighbors have been strained in recent years, with tensions flaring over claims of disputed sovereignty in the South China Sea. In February, Chinese warships held live-fire drills in waters near Vietnam in the Gulf of Tonkin, known as the Beibu Gulf in China, after Hanoi published a map defining its territorial claims there.

In his signed article in Vietnam’s Nhan Dan Newspaper, Xi urged the two countries to “properly manage differences and safeguard peace and stability in our region.”

“The successful delimitation of our boundaries on land and in the Beibu Gulf demonstrates that with vision, we are fully capable of properly settling maritime issues through consultation and negotiation,” Xi was quoted as writing.

This post appeared first on cnn.com

Sudan’s Rapid Support Forces (RSF) seized control of a major camp for displaced people in North Darfur, the paramilitary group said on Sunday, after a four-day assault the government and aid groups have said left hundreds dead or wounded.

The fighting has centered around the Zamzam camp, which, along with the nearby Abu Shouk camp, hosts some 700,000 people displaced by Sudan’s war. The assault has destroyed shelters, markets, and healthcare facilities, aid groups said.

The RSF said the camp was being used as a base by what it called “mercenary factions.” But humanitarian groups denounced the assault as a targeted attack on vulnerable civilians, including women, children and elderly people, who are already facing famine.

The Sudan Liberation Army (SLA), a Darfur militia allied to the national army, has been fighting the RSF around the city of al-Fashir, around 15 km (9.3 miles) from Zamzam, with the help of other local armed groups.

Tens of thousands of camp residents have fled to al-Fashir on foot, overwhelming shelters, and are now sleeping outdoors without food, water, or medicine, SLA spokesperson El-Sadiq Ali El-Nour said on Sunday.

The city – the capital of Sudan’s North Darfur province – came under heavy shelling and RSF ground attacks on Sunday, the SLA said, calling for military support from Sudan’s armed forces and allied factions.

The Sudanese army has a base with several thousand troops in al-Fashir.

“The leadership of the armed forces must act swiftly to save the lives of approximately 1.5 million people in al-Fashir urgently,” the SLA said in a statement. “Darfur must not fight alone.”

The RSF has denied targeting civilians and, on Saturday, accused its rivals of orchestrating a media campaign using actors and staged scenes within the camp to falsely incriminate it.

On Sunday, it said it had organized voluntary evacuations for families fleeing al-Fashir and surrounding camps and welcomed humanitarian agencies to respond to the deteriorating conditions.

The war in Sudan erupted in April 2023, sparked by a power struggle between the army and the RSF, shattering hopes for a transition to civilian rule.

The conflict has since displaced millions and devastated regions like Darfur, where the RSF is now fighting to maintain its stronghold amid army advances in Khartoum.

This post appeared first on cnn.com

I pay attention to technical support levels as the combination of price support/resistance is always my primary stock market indicator. We’re in a downtrend and, in my opinion, the trading range is very, very clear on the S&P 500 right now:

I think most everyone can agree that much of the selling and fear and panic can be attributed the trade war – at least much of the weakness occurred with startling tariff news. So I figured I’d take a look at Q4 2018, which also experienced a 2-3 month bear market with the S&P 500 just barely reaching the prerequisite 20% drop. Here’s what that looked like:

The chart pattern during Q4 2018 was quite similar. The VIX more than tripled from under 12 to above 36. The VIX also more than tripled in 2025, after starting from a much higher level near 15. In both 2018 and 2025, that initial selling episode saw a drop of roughly 10% before consolidating. Then the next drop was another 10% or so. We don’t know if the selling for 2025 has ended, though, as that’s the wild card.

Here’s what we do know about sentiment. The VIX, with a value in the 50s, is signaling a potential S&P 500 bottom. Historically, surges in the VIX to this level or higher, have coincided either with stock market bottoms or they at least they suggest that any future selling in the S&P 500 is likely to be minor. Here’s a long-term monthly chart of the S&P 500 and the VIX, showing this relationship:

Extreme fear marks bottoms and I believe this is a great visual to support this belief. History tells us that when the VIX tops, we’ve either bottomed or we’re very close to bottoming.

Late last week, we saw both the March Core CPI and March Core PPI come in well below expectations, which was a good result for those hoping for rate cuts to begin again later this year. On Friday, a lot of folks were talking very bearish after the University of Michigan consumer sentiment plummeted to a near 50-year low. The problem with that bearish line of thinking is that sentiment is a contrarian indicator. Bearish readings tend to be quite bullish for stocks, while bullish readings can mark significant tops. Don’t believe me? Check out this chart and then provide me your best bearish argument:

The low readings in the green-shaded areas are actually very bullish. You can’t argue with history and facts. When the general public is feeling despair, it’s the time to buy stocks, not sell. And for those who believe this time is different, let’s check back in one year from now and let’s see where we are.

Note one more thing. The absolute highest consumer sentiment reading was at the beginning of 2000, just before the dot com bubble burst. Everyone felt great back then and the S&P 500 didn’t make a meaningful new all-time high for 13 years. So you tell me, would you rather see sentiment strength or weakness?

I know it sounds awful to hear that consumer sentiment readings are among the lowest in history and it likely makes little sense to many why the stock market would go higher while sentiment is so negative. But you have to remember that the stock market looks 6-9 months ahead. It’s not concerned with the news coming out now. It’s much more concerned about what the market environment will look like later this year.

Here’s my last point for today. We’ve begun to see more bullish rotation among sectors and between growth and value. Let me show you one final chart that highlights the rotation into growth as the S&P 500 continues its descent:

Notice the S&P 500 made its final high in February as money rotated quickly from growth to value in the two months prior. That was Wall Street exiting the riskier areas of the market, when everything still looked fine. It was one of the many reasons why I turned cautious and moved to cash in late January. Now the opposite is occurring. The S&P 500 is downtrending and the news just keeps getting worse. Meanwhile, Wall Street is happily buying all the risky shares you’d like to sell.

Listen, I’ve been wrong before and maybe I’m wrong and the S&P 500 continues to decline throughout 2025. But I trust my review of the market and my signals that have worked so well for me in the past. I’m perfectly fine owning stocks right now.

Tomorrow morning, in our free EB Digest newsletter, I’ll be showing everyone the extreme manipulation that’s been taking place in the stock market the past 4 weeks or so. Market makers are stealing (legally) from all of us. I spotted this manipulation back in June 2022, which helped me to go against the grain and call the market bottom then and I’m seeing it again now. To learn more, be sure to CLICK HERE and sign up for our FREE EB Digest newsletter, if you haven’t already. There’s no credit card required and you may unsubscribe at any time.

Happy trading!

Tom

Editor’s Note: This article contains graphic images and descriptions.

Christine Pascual’s phone started buzzing while she was at work in a hair salon with messages saying former Philippine President Rodrigo Duterte was about to be arrested.

Laxamana, a 17-year-old with dreams of becoming an online gamer, went missing in August 2018 on his way home from a gaming tournament in the northern Philippines.

“His friends who went with him said they were short on money, so they split ways,” his mother recalled. With no word from him in days, she started her own search for her son. “I started looking for him at every computer shop around our area, thinking he was close to home.”

A week later, a letter from the police arrived. It said her son was dead.

She was taken to the morgue and greeted by a sight she had never imagined; her son’s body pierced by six gunshots and covered in bruises.

“When he was young, I’d worried about him being bitten by flies,” she said.

There is another image she will never forget; a photograph the police showed her of Laxamana’s lifeless body on the street where he was gunned down. She remembers his eyes were still wide open.

Pascual said the officers told her he was killed because “he tried to fight back.”

According to a Philippine Inquirer report, Rosales Municipal Police claimed Laxamana was on a motorbike, ignored a police checkpoint, then fired at officers.

“They accused him of horrible, unimaginable things,” said Pascual – who denies her son was a drug dealer and said he didn’t know how to ride a motorbike.

Pascual is determined to seek justice.

With the help of NGOs, she requested a second autopsy and raised money for his funeral. She has also recounted her testimony at senate hearings and public investigations and continues to work with human rights groups to gather evidence for her son.

She even took a case to the Philippines Supreme Court, but it was dismissed.

“We will fight wherever justice takes us…,” she said, “It’s been hard for me to accept my son died without any explanation. He was accused of something and was killed just like that…I hope that can change in this country,” she said.

Pascual is not alone.

A long-awaited arrest

Duterte’s court appearance in the International Criminal Court (ICC) last month is “a sight families of the thousands of victims of the ‘war on drugs’ in the Philippines feared they would never see,” said Amnesty International’s Southeast Asia Researcher Rachel Chhoa-Howard.

“The very institution that former President Duterte mocked will now try him for murder…is a symbolic moment and a day of hope for families of victims and human rights defenders who have for years fought tirelessly for justice despite grave risks to their lives and safety.”

It shows that those accused of committing the worst crimes “may one day face their day in court, regardless of their position,” Chhoa-Howard added.

Duterte ran the Philippines for six turbulent years, during which he oversaw a brutal crackdown on drugs and openly threatened critics with death.

In his inaugural address in 2016, he claimed there were 3.7 million “drug addicts” in the Philippines and said he would “have to slaughter these idiots for destroying my country.”

The figure was more than twice the number of active drug users reported in a 2015 Philippines Dangerous Drug board (DDB) study, which said 1.8 million people – just under 2% of the population – were using drugs.

By 2019, three years into the ‘war of drugs’, the DDB survey estimated 1.6 million people were taking dangerous drugs in the Philippines – an 11% decrease from 2015.

Among many Filipinos, Duterte’s drug war – and his bombastic disregard for the country’s political elites – remained popular for much of his time in office. But the collateral damage caused by so many extrajudicial deaths also mounted.

Many of the victims were young men from impoverished shanty towns, shot by police and rogue gunmen as part of a campaign to target alleged dealers.

According to police data, 6,000 people were killed – but rights groups say the death toll could be as high as 30,000, with innocents and bystanders often caught in the crossfire.

Duterte’s tough approach on drugs prompted strong criticism from opposition lawmakers who launched a probe into the killings. Duterte in turn jailed his fiercest opponent and accused some news media and rights activists as traitors and conspirators.

His blood-soaked presidency ended in 2022 but, three years on, hundreds, if not thousands, of extrajudicial killings have not been accounted for. Victims’ families are often spooked or threatened not to pursue their case in local courts, leaving hundreds in limbo with little to no due process in the Philippines.

To date, only eight policemen had been convicted for five drug war deaths, according to court documents.

The threat of being held to account in the ICC has been hanging over Duterte’s for almost a decade. Prosecutors first said they were watching what was happening in the Philippines in 2016, but it wasn’t until 2021 that a formal investigation was launched.

For years, Duterte – along with his loyal allies and fierce supporters – argued that allegations of wrongdoing should be dealt with by the Philippine justice system, saying the involvement of foreign courts would impede the country’s judicial independence and sovereignty.

As president, he even withdrew the Philippines from the ICC – which took effect in March 2019. That, however, proved to be no protection; the ICC still has jurisdiction for crimes alleged during the years the nation was a member.

Last week, Duterte went from boasting about killing drug dealers to being arrested for crimes against humanity as the ICC finally caught up with him.

In a dramatic arrest, the 80-year-old was outnumbered by local police when he returned to Manila from Hong Kong. After being detained for hours at an airbase, he was put on a plane bound for the Netherlands to face the ICC on charges of crimes against humanity – alleged to have been committed between 2011 and 2019.

On Thursday (March 14), Duterte made his first appearance via video link at The Hague where he appeared tired and slightly uneasy.

His defense lawyer, Salvador Medialdea, called the arrest a “pure and simple kidnapping.”

During the hearing, Presiding Judge Iulia Motoc read Duterte his rights and set September 23 as the date for a hearing to determine whether the evidence presented by the prosecution would be sufficient to take the case to trial.

Left without closure

Thousands of lives have been upended by the drug war killings. They not only left devastated parents to bury their children but also left dozens of children as orphans.

Eya was just 9-years-old when both her parents were shot by hooded, uniformed policemen at around three in the morning in August 2016.

Now 18, she and her sister work at a coffee shop in Manila run by families of victims.

”I hope justice will be given to us. And others responsible for the thousands of those who died will also get arrested.”

Cresalie Agosto was at work when her 16-year-old daughter called her in on December 1, 2016 with shocking news.

”Ma, dad has been shot. Please come back,” she heard her daughter say.

Agosto rushed home. Nearby, police had cordoned off an area surrounding her husband’s body.

Witnesses told her they saw two motorbikes each carrying two masked men carrying big, long guns, looking for a man named “Roy”. They asked her husband, Richie Reyes, if he was “Roy”.

She was told that he said he was not the man they were looking for, but they shot him anyway.

“There’s nothing more that we want other than justice and accountability,” Agosto said. “When Duterte was arrested upon arrival his rights were still read aloud to him. For us, our loved ones were greeted with bullets with no explanation.”

Luzviminda Siapo was away from home as migrant worker in Kuwait when tragic news that her 19-year-old son, Raymart, was killed by police in 2017.

Her son was born with clubfoot deformities – a condition which can affect mobility.

A witness who was sleeping in a parked jeepney in an alley told Siapo they heard police yell at Raymart to run away.

“No, I cannot run. I don’t want to run,” Raymart cried out, according to the witness. A gunshot was then heard.

Luzviminda said she wants to see Duterte “rot in jail” for her son’s death.

“He may be in jail, but he is alive unlike my son who died and is no longer with us. I cannot hug him anymore nor talk to him.”

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