Stocks Churn as Oil Advance Boosts Treasury Yields

Aaron Kennon of Clear Harbor Asset Management argues the Fed will likely stay on hold, making front-end Treasuries attractive. He favors high yield bonds over investment grade and Treasuries due to their shorter duration. S&P 500 and Nasdaq returns are driven by earnings, not multiple expansion, keeping valuations stable. He sees software companies regaining margin as AI models become cheaper utilities, with cloud and data center growth remaining strong. - Market leans toward no Fed rate hike, boosting front-end Treasury yields. - High yield bonds favored due to shorter duration and outperformance. - Equity gains driven by earnings, not valuation expansion. - Single-stock drawdowns high despite low VIX, reflecting active rotation. - Software stocks may recapture margins as AI models commoditize. - Cloud and data center spending remains robust.