September 2, 2025

Markets:

U.S. stock futures were lower Tuesday, with investors weighing the latest developments on the trade front to kick off a seasonally poor month for equities.

Investors took profits on bull market winners with the unofficial end of the summer season. Nvidia shares were off by 1.5%. Palantir shed 2% to pace losses in Big Tech shares.

Investors were also eying a surge in bond yields to start September. The 10-year Treasury yield jumped to 4.29%, while the 30-year yield
 neared 4.98%.

Adding to uncertainty are questions around the future of Federal Reserve independence, given the Trump administration’s efforts to oust central bank officials. A court hearing that Trump be temporarily barred from firing Lisa Cook ended Friday without a ruling. This week, Stephen Miran, a Trump nominee, has his Senate Banking Committee hearing scheduled on Sept. 4.

September is historically the worst month for stocks. In data going back to 1950, the S&P 500 has averaged a 0.7% decline in September, both for all years and post-election years, according to the Stock Trader’s Almanac.

Portfolio:

The first trading session of September is flashing red on ultra-low volume, with headlines loudly reminding investors that September is “historically the worst month for stocks.” Keep in mind, though, these markets have rarely behaved as the majority expect. The broader trend remains firmly intact.

We head into the new week and month holding setups in SOUN, ONDS, NIO, and ZMDTF. The queue is highly active, with several extreme oversold names showing up premarket—though with volume this light, some may not materialize after the opening bell.

September is often slow and choppy, but that theme doesn’t always hold. We’ve historically benefited from entering setups ahead of the turn, and we’re preparing to do so again. Friday’s bear gap holding into the weekend wasn’t a great sign, but a close in the coming days would turn that gap into support. Key downside support levels sit at 640, 635, 620, with 600 as a major wall unlikely to be breached. On the upside, 650 is the line the bulls need to reclaim—a breakout above 650 would be epic!  Really believe we will get this runway.  

Also worth remembering: the hedge fund performance chase hasn’t even started. As noted this summer, hedge funds are up just +4.67% YTD vs. MSCI World +11.19%. Markets typically can’t top until CTAs go green for the year—like it or not, that dynamic still applies.  We don't make the rules!

Finally, a thought to leave you with: the media will keep hammering the “September is weak” narrative. But is the real crack forming in stocks—or in the U.S. dollar? A dollar unwind colliding with underexposed risk assets is the recipe for a September and year-end rally that forces a chase. If it plays out, none of us will be surprised. The dollar’s weakness is exactly the signal that opportunity is building.  Please understand this.