What Happened

  • ISM services surprised to the upside, reinforcing a resilient growth narrative.
  • Treasury yields rose and the curve bear-steepened on the data.
  • Financials and industrials led while mega-cap tech lagged.
  • The dollar firmed and gold dipped.

What It Means

  • Stronger services activity delays the timing of rate cuts.
  • Sector leadership is shifting toward cyclicals as yields rise.
  • A firmer dollar can cap commodity gains if it persists.

What I Think

  • I am leaning into value leadership while keeping duration risk contained.
  • If yields keep climbing, growth valuations will compress quickly.
  • The data path is now the main driver into payrolls.

Market Terms

  • Bear steepening - Yields rise, with long rates rising faster than short rates.
  • Services surprise - Data print above consensus for the services sector.
  • Duration compression - Valuation pressure on assets sensitive to rates.