Weekly Hotline: October 2, 2026
SPECIAL ANNOUNCEMENT
InvesTech Research had the opportunity to speak at the 2026 Glacier Summit Wealth Conference, connecting with subscribers and investors from across the country. We recorded both presentations by InvesTech and are posting them to our website as they become available.
The first of these videos, The Most Valuable Lessons from Over 100 Years of Wall Street History, is available to watch now!
Markets remained volatile this week as technical warning flags continue to build.
MACROECONOMIC UPDATE
- Consumer Confidence dropped 6.7 points to 81.9, its lowest level since 2014. The decline was driven by both deteriorating assessments of current conditions and falling future expectations.
- Following adjustments due to methodology changes (see Market Insight), the Personal Consumption Expenditures (PCE) Price Index showed inflation was essentially unchanged in August as the overall rate stayed at 3.4% and the Core rate, which excludes the volatile food and energy components, remained at 3.0%. This is still well above the Fed’s 2% target.
- The Institute for Supply Management (ISM) Manufacturing Purchasing Managers Index ticked down from 54.6% to 54.5%, but the Prices component shot up from 71.1 to 77.9 as costs rose significantly.
- The Employment Report for September came in weaker than expected as only 29,000 jobs were added and the Unemployment Rate moved up from 4.1% to 4.2%.
TECHNICAL UPDATE
- Bearish Distribution in the InvesTech Negative Leadership Composite (NLC) remained at -100 as downside leadership continued to increase. This warns that the underlying fundamentals of the market do not support a renewed bull market leg, and further losses are likely.
- The InvesTech A/D Divergence Index broke down further this week. If market breadth continues to deteriorate, it will warn that a market top could be in place.
INVESTECH MODEL FUND PORTFOLIO
There are no changes to the Model Fund Portfolio this week, which remains defensive and is comprised of 62.5% long positions, 8% in an inverse index ETF, 5% in an intermediate Treasury ETF, and 24.5% cash held in short-term Treasurys or a money market fund. This results in 54.5% net equity exposure.
