Soft Retail Data Fuels Real-Asset Rotation

What Happened

• Retail sales missed, with revisions lower; consumer strength is fading at the margin.
• The dollar traded heavy as yields dipped, giving EM FX and commodities breathing room.
• Flows favored energy, infrastructure, and value ETFs; tech remained an ATM for funding those reallocations.

What It Means

• Softer consumption reinforces the idea that the Fed can stay on hold, easing stress without inviting panic.
• A weaker dollar removes a key headwind for commodities, making real assets the simplest risk expression into year-end.
• Equity leadership continues to migrate toward cash flow and away from duration, keeping breadth healthier than last month.

What I Think

• This is classic late-cycle rotation: buy earnings visibility, sell expensive growth when macro momentum cools.
• Unless retail collapses, this shift can persist without triggering credit stress.
• I’m keeping exposure skewed to energy and infrastructure while letting tech weights drift lower.

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Market Terms

• ATM Tech — Using tech holdings as the cash source to fund other trades.
• Late-Cycle Rotation — Moving into defensives and real assets as growth data softens.
• Breadth — The number of stocks participating in the move; widening breadth confirms healthier risk appetite.