Fundstrat Head of Research Tom Lee said the rally in U.S. shares and a change in the VIX curve strengthened his view that last week’s selloff may have marked a market low.
In a Nov. 9 Fundstrat Macro Minute video, Lee cited stocks rising despite weekend news involving Nvidia and discussion of Elon Musk’s business dealings in Texas. He described the market’s response to those headlines as encouraging.
Lee also pointed to the relationship between four-month and one-month VIX measures. The VIX gauges expected volatility in U.S. stocks. Their relationship inverted last week before returning to its usual pattern, he said, calling the shift a recurring sign of a possible market low.
Lee said the intensity of the previous week’s selling may have moved the market closer to a floor. In his view, investor expectations were gloomier than market conditions justified.
Fundstrat’s video also flagged upcoming indicators, including the New York Fed’s inflation expectations survey, October core CPI, existing home sales, core producer price index and scheduled Federal Reserve commentary.
