A summary of everything that's moved since the prior report. The diff below compares the current run against the most recent MacroDriver-state JSON. The headline this week: the June CPI came in soft — a real core-services disinflation — but the stagflation source has rotated from sticky services-core to a live Iran/Hormuz energy supply shock, so the regime did not flip.
| Event | Date | Donatien | Consensus | Actual | Result | Surprise |
|---|---|---|---|---|---|---|
| CPI (Jun) | Jul 14 | Core MoM +0.3% | Core +0.2% / Hdln −0.1% | Core 0.0%; Hdln −0.4%; Core YoY 2.6% | MISS | −0.2pp core vs cons |
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| Driver | Dominance | Gold | TIPS | Silver | JPY / Safe FX | Defense | Agriculture | Oil | Copper / Ind Metals | EM Equities | Long Treasuries | USD | US Equities | US Tech | High Yield | IG Credit |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| TEMP Iran / Hormuz Crisis TEMP | CRITICAL (5) | ↑ +0.11 | ↑ +0.11 | · +0.00 | ↑ +0.11 | ↑↑ +0.22 | ↑ +0.11 | ↑↑ +0.22 | · +0.00 | ↓ -0.11 | ↓ -0.11 | ↑ +0.11 | ↓ -0.11 | ↓ -0.11 | ↓ -0.11 | · +0.00 |
| END Global Monetary Policy END | CRITICAL (5) | · +0.00 | ↑ +0.11 | ↓ -0.11 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↓ -0.11 | ↓ -0.11 | ↑ +0.11 | ↓ -0.11 | ↓ -0.11 | ↓ -0.11 | ↓ -0.11 |
| END US Economic Health END | HIGH (4) | ↑ +0.09 | · +0.00 | · +0.00 | ↑ +0.09 | · +0.00 | · +0.00 | ↓ -0.09 | ↓ -0.09 | · +0.00 | ↑ +0.09 | ↓ -0.09 | ↓ -0.09 | · +0.00 | ↓ -0.09 | · +0.00 |
| END US Fiscal Trajectory & Sovereign Debt END | HIGH (4) | ↑ +0.09 | ↑ +0.09 | ↑ +0.09 | · +0.00 | ↑ +0.09 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↓↓ -0.17 | ↓ -0.09 | · +0.00 | · +0.00 | ↓ -0.09 | ↓ -0.09 |
| TEMP Tariff War — Aug 1 Escalation TEMP | HIGH (4) | ↑ +0.09 | ↑ +0.09 | · +0.00 | ↑ +0.09 | ↑ +0.09 | ↑ +0.09 | · +0.00 | ↓ -0.09 | ↓↓ -0.17 | ↓ -0.09 | ↑ +0.09 | ↓ -0.09 | ↓ -0.09 | ↓ -0.09 | · +0.00 |
| END Private Credit & Shadow Banking Stress END | HIGH (4) | ↑ +0.09 | · +0.00 | · +0.00 | ↑ +0.09 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↓ -0.09 | ↑ +0.09 | · +0.00 | ↓ -0.09 | · +0.00 | ↓↓ -0.17 | ↓ -0.09 |
| END AI & Productivity Revolution END | MODERATE (3) | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | · +0.00 | · +0.00 | ↑ +0.07 | ↑↑ +0.13 | · +0.00 | · +0.00 |
| END De-dollarisation & Monetary Geopolitics END | MODERATE (3) | ↑↑ +0.13 | ↑ +0.07 | ↑ +0.07 | ↑ +0.07 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↑ +0.07 | ↓ -0.07 | ↓↓ -0.13 | · +0.00 | · +0.00 | · +0.00 | · +0.00 |
| END Structural Deglobalisation & Trade END | MODERATE (3) | ↑ +0.07 | ↑ +0.07 | · +0.00 | · +0.00 | ↑ +0.07 | ↑ +0.07 | ↑ +0.07 | ↑ +0.07 | ↓ -0.07 | ↓ -0.07 | · +0.00 | ↓ -0.07 | ↓ -0.07 | · +0.00 | · +0.00 |
| END China Economic Health END | MODERATE (3) | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | · +0.00 | ↑ +0.07 | ↑ +0.07 | ↑↑ +0.13 | ↑ +0.07 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | · +0.00 |
| END Energy Transition & Electrification END | MODERATE (3) | · +0.00 | · +0.00 | ↑↑ +0.13 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↑↑ +0.13 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | · +0.00 |
| END NATO Rearmament & Global Defense END | MODERATE (3) | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | ↑↑ +0.13 | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | ↓ -0.07 | · +0.00 | ↑ +0.07 | · +0.00 | · +0.00 | · +0.00 |
| TEMP Japan / Yen Carry-Trade Unwind TEMP | BACKGROUND (2) | · +0.00 | · +0.00 | · +0.00 | ↑ +0.04 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↓ -0.04 | · +0.00 | · +0.00 | ↓ -0.04 | ↓ -0.04 | ↓ -0.04 | · +0.00 |
| NET SIGNAL | Σ(impact×dom)/Σdom | SO +0.65 | SO +0.52 | O +0.37 | O +0.48 | SO +0.59 | O +0.33 | O +0.26 | O +0.28 | U -0.46 | U -0.50 | N +0.00 | U -0.46 | N -0.22 | SU -0.70 | U -0.28 |
| Driver | Dominance | Technology | Financials | Health Care | Cons. Disc. | Cons. Staples | Energy | Industrials | Materials | Utilities | Real Estate | Comm. Svcs |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| TEMP Iran / Hormuz Crisis TEMP | CRITICAL (5) | ↓ -0.11 | · +0.00 | ↑ +0.11 | ↓ -0.11 | ↑ +0.11 | ↑↑ +0.22 | · +0.00 | · +0.00 | ↑ +0.11 | ↓ -0.11 | ↓ -0.11 |
| END Global Monetary Policy END | CRITICAL (5) | ↓ -0.11 | ↑ +0.11 | · +0.00 | ↓ -0.11 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↓ -0.11 | ↓↓ -0.22 | ↓ -0.11 |
| END US Economic Health END | HIGH (4) | · +0.00 | ↓ -0.09 | ↑ +0.09 | ↓ -0.09 | ↑ +0.09 | ↓ -0.09 | ↓ -0.09 | ↓ -0.09 | ↑ +0.09 | · +0.00 | · +0.00 |
| END US Fiscal Trajectory & Sovereign Debt END | HIGH (4) | · +0.00 | · +0.00 | · +0.00 | ↓ -0.09 | · +0.00 | ↑ +0.09 | ↑ +0.09 | ↑ +0.09 | ↓ -0.09 | ↓ -0.09 | · +0.00 |
| TEMP Tariff War — Aug 1 Escalation TEMP | HIGH (4) | ↓ -0.09 | · +0.00 | · +0.00 | ↓ -0.09 | · +0.00 | · +0.00 | ↑ +0.09 | ↓ -0.09 | · +0.00 | · +0.00 | ↓ -0.09 |
| END Private Credit & Shadow Banking Stress END | HIGH (4) | · +0.00 | ↓↓ -0.17 | ↑ +0.09 | ↓ -0.09 | ↑ +0.09 | · +0.00 | · +0.00 | · +0.00 | ↑ +0.09 | ↓ -0.09 | · +0.00 |
| END AI & Productivity Revolution END | MODERATE (3) | ↑↑ +0.13 | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | ↑ +0.07 | · +0.00 | ↑↑ +0.13 |
| END De-dollarisation & Monetary Geopolitics END | MODERATE (3) | · +0.00 | ↑ +0.07 | · +0.00 | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | ↑ +0.07 | · +0.00 | · +0.00 | · +0.00 |
| END Structural Deglobalisation & Trade END | MODERATE (3) | ↓ -0.07 | · +0.00 | · +0.00 | ↓ -0.07 | · +0.00 | ↑ +0.07 | ↑↑ +0.13 | ↑ +0.07 | · +0.00 | · +0.00 | · +0.00 |
| END China Economic Health END | MODERATE (3) | ↑ +0.07 | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | ↑ +0.07 | ↑ +0.07 | ↑↑ +0.13 | · +0.00 | · +0.00 | ↑ +0.07 |
| END Energy Transition & Electrification END | MODERATE (3) | ↑ +0.07 | · +0.00 | · +0.00 | ↑ +0.07 | · +0.00 | ↓ -0.07 | ↑ +0.07 | ↑↑ +0.13 | ↑↑ +0.13 | · +0.00 | · +0.00 |
| END NATO Rearmament & Global Defense END | MODERATE (3) | ↑ +0.07 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↑↑ +0.13 | ↑ +0.07 | · +0.00 | · +0.00 | · +0.00 |
| TEMP Japan / Yen Carry-Trade Unwind TEMP | BACKGROUND (2) | ↓ -0.04 | · +0.00 | · +0.00 | ↓ -0.04 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | · +0.00 | ↓ -0.04 |
| NET SIGNAL | Σ(impact×dom)/Σdom | N -0.09 | N -0.09 | O +0.28 | U -0.48 | O +0.28 | O +0.35 | SO +0.54 | O +0.37 | O +0.28 | U -0.50 | N -0.15 |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| Brent / WTI (USO ETF) | Brent ~$84 · WTI ~$76 | ↑ +15% on the month; Brent at a multi-month high (USO ETF +15% to ~$120) | >$85 Brent | > $95 Brent or Hormuz closure | ● BREACH | Oil up · energy inflation floor · XLE up |
| Strait of Hormuz | Declared CLOSED | IRGC 12 Jul; US resuming Iran-port blockade (20% fee scrapped 14 Jul) | Tanker slowdown | Full closure | ● BREACH | Global risk-off · supply-chain premium · EM down |
| Escalation state | Active strikes | US/Iran exchanging strikes; attacks on Bahrain/Kuwait | Ceasefire talks | Regional war | ● BREACH | Safe-haven bid (gold, JPY, USD) · Defense up |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| Fed Funds (target) | 3.50-3.75% | Hold expected 29 Jul | Cut signal | Hike | ● OK | USD firm · front-end anchored high |
| 2Y Treasury | 4.26% | ↑ +12bp on the week; ~63bp ABOVE funds | 2Y toward funds = dovish | 2Y >4.6% | ● WATCH | Higher-for-longer priced · TLT pressured |
| Sep cut odds | ~51% | Re-opened by soft CPI; capped by the oil shock | <35% = hawkish | Cut delivered | ● WATCH | Rate-path volatility · gold/tech swing on each print |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| Unemployment | 4.2% | ↓ from 4.3% (household-survey noise; payrolls weak) | 4.5% | 4.7% | ● WATCH | Labour swing factor · defensives over cyclicals |
| June Payrolls | +57k | Well below trend; reaccel refuted | >75k | <0 | ● WATCH | XLY down · XLP/XLV up · Fed pinned but cut door ajar |
| Core CPI YoY | 2.6% | ↓ from 2.9% — real services/shelter disinflation | 2.5% | <2.3% | ● OK | Rate-relief for growth · but energy shock is the offset |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| 10Y Treasury | 4.62% | ↑ from 4.48% — breached the 4.5% vigilante line | >4.5% | >5% | ● BREACH | TLT down · XLRE down · mortgage rates up |
| 10Y-2Y curve | +0.36 | ↑ steepening (long-end supply + term premium) | <0 (invert) | >+0.75 | ● WATCH | Steepener persists · XLF NIM up |
| Deficit / GDP | >7% | Structural; heavy T-bill + coupon issuance | 6% | 8% | ● WATCH | Gold/TIPS structural bid · debasement hedge |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| Aug-1 deadline | Live (T−18d) | Letters out; ~19 deals closed, others at up to 50% | Extension | Broad tariffs land | ● WATCH | Goods inflation up · EM/trade-levered down |
| China bloc threat | +10% mooted | On countries aligning with China/Russia | De-escalation | New sector tariffs | ● WATCH | Supply-chain fragmentation · reshoring bid |
| Deals closed | ~19 | EU/Japan/Korea/India/Vietnam done | More deals | Talks collapse | ● OK | Reduces the tail; Canada/Mexico the swing |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| HY spreads (HYG) | ~$79.7 (calm) | Stable — no stress signal yet | Spread widening | Disorderly widening | ● OK | Latent — calm keeps risk assets bid |
| BDC redemptions | Elevated | Non-traded BDC redemption queues rising (Goldman) | Gating | Widespread gating | ● WATCH | Contagion risk to HY/IG/equities together |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| Top-10 weight | ~41% of S&P | Breadth narrow; concentration past 1930s peak | <38% | >45% | ● WATCH | Index-level (not sector) drawdown risk if the loop reverses |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| CB gold buying | +41t (May) | Structural; 84% see reserves rising | Buying slows | Net selling | ● OK | Gold/silver structural bid · USD reserve-share erosion |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| Reshoring capex | Elevated | Industrial-policy tailwind persists | Rollback | Policy reversal | ● OK | XLI/XLB structural support |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| Jun exports YoY | +27% | ↑ well above the +18% forecast | >15% | <0 | ● OK | Copper/EM up · global-trade resilient |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| Silver deficit | Structural | Solar + industrial demand > mine supply | Surplus | Sustained surplus | ● WATCH | Silver/copper long-term bid |
| Indicator | Value | Trend | Watch | Breach | Status | Asset Impact |
|---|---|---|---|---|---|---|
| Defence spend | Record | +20% (2025); 5% GDP target by 2035 | Budget cuts | Commitments slip | ● OK | Defense/XLI structural bid |
| Asset | Short (0–4w) | Medium (1–6m) | Long (6–18m) | Rationale |
|---|---|---|---|---|
| Gold | N | O | O | CB real-money bid + soft-CPI rate relief + Iran safe-haven vs residual hawkish real rates — short capped (divergence), medium/long bid reasserts. |
| TIPS | N | O | O | Energy-shock inflation + fiscal debasement; real yields high near-term, breakevens firm medium/long. |
| Silver | U | N | O | Hawkish real rates cap the short; electrification/solar deficit drives the long. |
| JPY / Safe FX | N | N | N | Carry revived, yen weak ~160; only a risk-off spike or BOJ move flips it. |
| Defense | O | O | O | NATO 5% supercycle + the live Gulf war — a durable multi-horizon bid. |
| Agriculture | N | O | O | Energy/input costs + tariff/food-supply frictions; medium/long DBA bid. |
| Oil | SO | N | N | Live Hormuz supply shock (oil +15%) drives a strong short; medium/long fade as the premium is path-dependent. |
| Copper / Ind Metals | N | O | SO | China trade strong + electrification supercycle; short capped by growth wobble. |
| EM Equities | U | N | O | Iran risk-off + Aug-1 tariff pressure the short; softer USD + China trade lift the long. |
| Long Treasuries | U | U | N | 10Y at 4.62% (breached 4.5%) + energy-shock inflation keep the long end pressured; a growth scare is the only medium relief. |
| USD | O | O | U | Safe-haven + rate-differential bid short/medium; de-dollarisation erodes it long. |
| US Equities | N | N | N | Soft-CPI relief offsets the oil-shock/concentration overhang — a genuine standoff across horizons. |
| US Tech | N | N | O | Rate relief eases the short multiple headwind; concentration is the medium risk; AI productivity the long bid. |
| High Yield | U | U | N | Higher-for-longer refinancing stress + private-credit tail; spreads calm for now but the risk builds. |
| IG Credit | U | N | N | Rate pressure short; stabilises as duration risk is repriced. |
| Sector | Short (0–4w) | Medium (1–6m) | Long (6–18m) | Rationale |
|---|---|---|---|---|
| Technology (XLK) | N | O | O | Rate relief eases the short; AI-capex + productivity drive medium/long; concentration is the caveat. |
| Financials (XLF) | O | O | N | Higher-for-longer NIM + a steepening curve; private-credit tail caps the long. |
| Health Care (XLV) | O | O | O | Defensive rotation + disinflation + rate-insensitivity — the actively-bid winner of higher-for-longer. |
| Cons. Disc. (XLY) | U | N | N | Weak consumer (payrolls +57k, cooling retail) + oil-shock gasoline tax on discretionary spend. |
| Cons. Staples (XLP) | O | O | N | Defensive + disinflation lifts real incomes; a short-term rotation winner. |
| Energy (XLE) | SO | O | O | Live Hormuz supply shock (oil +15%) — a direct short tailwind; medium/long hold on a firm energy floor. |
| Industrials (XLI) | O | O | SO | Reshoring + NATO defense capex + the Gulf war; the multi-horizon structural leader. |
| Materials (XLB) | N | O | SO | China trade strong + electrification supercycle; short capped by the growth wobble. |
| Utilities (XLU) | N | O | O | Rate-sensitive defensive + AI/data-centre power demand; long-rate level caps the short. |
| Real Estate (XLRE) | U | U | N | 10Y at 4.62% (breached 4.5%) is a direct headwind; only a decisive rate fall relieves it. |
| Comm. Svcs (XLC) | O | O | O | AI-levered platforms + resilient ad/gaming; part of the concentration cohort to watch. |
| Ticker | Sector (inherits) | Short | Medium | Long | Idiosyncratic macro rationale |
|---|---|---|---|---|---|
| SU.TO | Energy (XLE) | O | O | N | Inherits Energy (short SO on the live Iran/Hormuz oil spike). Canadian integrated oil — direct beneficiary of oil ~+15% on the Hormuz closure; the live crude uptrend amplifies the short driver. Long fades to N as the premium is path-dependent (a ceasefire bleeds it out). |
| FANG | Energy (XLE) | O | O | N | Inherits Energy; high-beta Permian E&P — moves 1.5–2× WTI, so the Hormuz supply shock is a direct short tailwind. Medium holds on a firm oil floor; long N as the geopolitical premium is not a durable multiple. |
| EOG | Energy (XLE) | O | O | N | Inherits Energy; premier US E&P, oil-levered FCF — a direct oil-shock beneficiary short/medium. Long N once the premium normalises; disciplined capital return underpins the floor. |
| CSU.TO | Technology (XLK) | N | O | O | Inherits Tech (short N on rate/valuation). Canadian vertical-software compounder — sticky recurring revenue, tariff-insulated, least exposed to the §1 AI-concentration tail; the core-disinflation rate relief is a mild short tailwind. Highest medium/long conviction of the set. |
| MSFT | Technology (XLK) | N | O | O | Inherits Tech; mega-cap AI/Azure carries the §1 concentration flag (part of the ~41% top-10) and is rate-sensitive short, but soft core CPI eases the multiple headwind and the AI-capex + FCF engine drives medium/long. |
| IFC.TO | Financials (XLF) | O | O | N | Inherits Financials (short O). Canadian P&C insurer — higher-for-longer lifts float/investment yield, domestic and tariff-insulated; the private-credit fault line is a mild watch, not a direct hit. Long N as the curve-steepening tailwind matures. |
| GILD | Health Care (XLV) | O | O | O | Inherits Health Care (short O). Defensive pharma — rate-insensitive, tariff-insulated, the actively-bid winner of the higher-for-longer defensive rotation; soft CPI + oil-shock risk-off both favour defensives. The cleanest short-term O of the set. |
| MRK | Health Care (XLV) | O | O | O | Inherits Health Care; large-cap defensive pharma with durable cash flows — same rate-insensitive, tariff-insulated defensive-rotation tailwind as GILD; oncology franchise underpins medium/long. |
| Asset | Flow | Money Type | Conf | Short 0–4w | Med 1–6m | Long 6–18m | Key Drivers | Rationale |
|---|---|---|---|---|---|---|---|---|
| ▲ Part A — Inflows | ||||||||
| Oil (USO) | ↑↑ | Fast Real | High | IN | — | — | Iran×5 Deglob×3 | Hormuz declared closed + US resuming an Iran-port blockade — fast money chasing a live supply-shock premium; real hedgers fade the path-dependent spike. |
| Defense (XAR) | ↑ | Real | High | IN | IN | IN | NATO×3 Iran×5 | NATO 5% supercycle + the live Gulf war — a durable multi-horizon real-money bid. |
| Gold (GLD) | ↑ | Real | Medium | — | IN | IN | De-dollar×3 Fiscal×4 Iran×5 | CB structural accumulation (+41t May) + fiscal debasement + safe-haven; short capped by fast-money hawkish selling (Part C). |
| TIPS | ↑ | Real | Medium | — | IN | IN | Fiscal×4 Iran×5 | Energy-shock + fiscal inflation; real yields high near-term, breakevens firm medium/long. |
| Copper / Materials | ↑ | Real | Medium | — | IN | IN | China×3 Electrify×3 | China trade booming (imports +36%) + the electrification/grid supercycle. |
| USD (UUP) | ↑ | Real Fast | Medium | IN | IN | OUT | Iran×5 Fed×5 De-dollar×3 | Safe-haven + rate-differential bid short/medium; de-dollarisation erodes it long (Part C). |
| ▼ Part B — Outflows | ||||||||
| Long Treasuries (TLT) | ↓↓ | Real Fast | High | OUT | OUT | — | Fiscal×4 Fed×5 Iran×5 | 10Y at 4.62% (breached the 4.5% vigilante line) + energy-shock inflation + heavy issuance. |
| High Yield (HYG) | ↓ | Fast | Medium | OUT | OUT | — | PrivCredit×4 Fed×5 | Higher-for-longer refinancing stress + the private-credit fault line; spreads calm now, risk builds. |
| EM Equities (EEM) | ↓ | Fast | Medium | OUT | — | IN | Iran×5 Tariff×4 | Iran risk-off + Aug-1 tariff pressure the short; softer USD + resilient China trade lift the long. |
| Asset | Flow | Money Type | Conf | Short 0–4w | Med 1–6m | Long 6–18m | Key Drivers | Rationale |
|---|---|---|---|---|---|---|---|---|
| ▲ Part A — Inflows (overweight) | ||||||||
| Energy (XLE) — SU.TO, FANG, EOG | ↑↑ | Fast Real | High | IN | IN | IN | Iran×5 Deglob×3 | Live Hormuz supply shock — the cleanest short-horizon rotation winner; energy floor holds medium/long. |
| Industrials (XLI) | ↑ | Real | High | IN | IN | IN | NATO×3 Deglob×3 China×3 | Reshoring + NATO defense capex + Gulf war — the multi-horizon structural leader. |
| Health Care (XLV) — GILD, MRK | ↑ | Real | Medium | IN | IN | IN | Fed×5 PrivCredit×4 | Defensive rotation + disinflation + rate-insensitivity — the higher-for-longer defensive winner. |
| Materials (XLB) | ↑ | Real | Medium | — | IN | IN | China×3 Electrify×3 | China trade + electrification supercycle; short capped by the growth wobble. |
| Cons. Staples (XLP) | ↑ | Real | Medium | IN | IN | — | Fed×5 | Defensive + disinflation lifts real incomes; a short-term rotation winner. |
| Financials (XLF) — IFC.TO | ↑ | Real Fast | Medium | IN | IN | — | Fed×5 Fiscal×4 | Higher-for-longer NIM + a steepening curve; private-credit tail is the long-horizon caveat (Part C). |
| ▼ Part B — Outflows (underweight) | ||||||||
| Real Estate (XLRE) | ↓↓ | Real Fast | High | OUT | OUT | — | Fiscal×4 Fed×5 | 10Y at 4.62% (breached 4.5%) is a direct headwind; only a decisive rate fall relieves it. |
| Cons. Disc. (XLY) | ↓ | Fast | Medium | OUT | — | — | Iran×5 Fed×5 | Weak consumer (payrolls +57k, cooling retail) + the oil-shock gasoline tax on discretionary spend. |
{
"run_date": "2026-07-14",
"next_update_date": "2026-07-17",
"next_update_basis": "US Retail Sales (Jun) 2026-07-16 +1 trading day — the consumer read that tests the disinflationary-slowdown vs reacceleration split; the live Iran/Hormuz escalation (Hormuz declared closed) is a wildcard that could force an earlier ad-hoc refresh, and the 29 Jul FOMC is the next regime event just beyond the 14-day ceiling.",
"dominant_regime": "Stagflation-lite — narrow lead (energy-supply-shock driven); Soft Landing closing on core disinflation",
"scenarios": {
"Stagflation": {
"probability": 35
},
"Soft Landing": {
"probability": 27
},
"Reacceleration": {
"probability": 21
},
"Deflationary Bust": {
"probability": 17
}
},
"total_active_dominance": 46,
"drivers": [
{
"name": "Iran / Hormuz Crisis",
"type": "temporary",
"dominance": 5,
"dominance_label": "CRITICAL (5)",
"short_thesis": "Any tanker/strike/closure headline moves markets that day. Oil holds a large risk-premium; safe-haven flows into gold, defense, USD. The energy shock reverses June's disinflation — the July CPI (mid-Aug) likely re-accelerates on gasoline.",
"medium_thesis": "Path-dependent. A ceasefire/de-escalation bleeds the premium out (Brent back toward the low-$70s); an entrenched conflict or a hard closure spikes oil further. Base case: contested, Brent elevated ~$82-92 (WTI ~$74-84).",
"long_thesis": "Structurally a tail geopolitical hedge once resolved — but an entrenched Gulf conflict keeps an energy-inflation floor under the stagflation thesis and a durable defense-spending bid."
},
{
"name": "Global Monetary Policy",
"type": "enduring",
"dominance": 5,
"dominance_label": "CRITICAL (5)",
"short_thesis": "29 Jul FOMC hold is base case; guidance drop keeps rate-path volatility high. Today's dovish CPI reaction is a one-day relief blip, NOT tape confirmation — the 2Y at 4.26 is ~63bp above funds and rose on the week; higher-for-longer is still priced.",
"medium_thesis": "If the committee stays split, the higher-for-longer bar holds through Q3. A confirmed 2nd soft core print + oil rolling over could deliver a Sep cut; the oil shock is the main obstacle. A hike would be an outright hawkish shock.",
"long_thesis": "Structural: the real-neutral-rate debate and fiscal dominance keep this a multi-year swing factor even once the near-term path resolves."
},
{
"name": "US Economic Health",
"type": "enduring",
"dominance": 4,
"dominance_label": "HIGH (4)",
"short_thesis": "Q2 GDP (30 Jul) and retail sales (16 Jul) test whether the consumer is rolling over. Soft prints add to the disinflationary-slowdown read, not reacceleration; the oil shock is an added tax on the consumer.",
"medium_thesis": "Deceleration continues but no recession trigger yet; labour resilience is the swing. Defensives over cyclicals. A labour break would flip the tail toward Deflationary Bust.",
"long_thesis": "If the slowdown deepens with the energy shock still lifting headline inflation, the stagflation weight rises; a clean labour break shifts the tail to Deflationary Bust."
},
{
"name": "US Fiscal Trajectory & Sovereign Debt",
"type": "enduring",
"dominance": 4,
"dominance_label": "HIGH (4)",
"short_thesis": "30Y/10Y auctions and the June budget statement keep term-premium and supply in focus; TLT/XLRE pressured. The 10Y above 4.5% is a live headwind for long-duration equities.",
"medium_thesis": "The deficit trajectory and heavy issuance keep the long end elevated; the steepener persists barring a growth scare. A 10Y sustained above 5% would tighten financial conditions independently of the Fed.",
"long_thesis": "Fiscal dominance is the multi-year debasement thesis behind gold, TIPS and hard assets — the slow, structural bid."
},
{
"name": "Tariff War — Aug 1 Escalation",
"type": "temporary",
"dominance": 4,
"dominance_label": "HIGH (4)",
"short_thesis": "The 1 Aug deadline drives risk-off and EM weakness into month-end; letters/retaliation headlines set the tape. Combined with the oil shock, this is a two-sided supply-side inflation risk.",
"medium_thesis": "If tariffs land, goods inflation firms and supply chains fragment further — adds directly to the stagflation weight. The ~19 closed deals cap the downside.",
"long_thesis": "A durable multi-year regime change in trade architecture — a reshoring/defense tailwind, a headwind for global-trade-levered EM and tech hardware."
},
{
"name": "Private Credit & Shadow Banking Stress",
"type": "enduring",
"dominance": 4,
"dominance_label": "HIGH (4)",
"short_thesis": "No dated catalyst; monitor BDC redemption queues and HY spreads. Currently calm — the dominance is latent risk, not an active move.",
"medium_thesis": "Higher-for-longer raises refinancing stress through H2; the longer rates stay up, the more this builds. An oil-shock growth drag would accelerate it.",
"long_thesis": "The $2T+ private-credit market is the cycle's untested fault line — a default cascade would hit HY, IG and equities together."
},
{
"name": "AI & Productivity Revolution",
"type": "enduring",
"dominance": 3,
"dominance_label": "MODERATE (3)",
"short_thesis": "Q2 mega-cap earnings (late Jul) are the catalyst; concentration means index-level sensitivity to any single guide-down. Soft CPI eased the multiple headwind near-term.",
"medium_thesis": "AI-capex cycle intact medium-term; watch for hyperscaler capex cuts or private-AI markdowns as the falsifier.",
"long_thesis": "Productivity uplift is real and structural; the risk is the valuation/concentration overhang, not the technology."
},
{
"name": "De-dollarisation & Monetary Geopolitics",
"type": "enduring",
"dominance": 3,
"dominance_label": "MODERATE (3)",
"short_thesis": "No dated catalyst; watch WGC purchase data and COMEX/vault flows. Fast-money hawkish selling capped gold short-term; the real-money bid is the floor.",
"medium_thesis": "Reserve managers keep diversifying into gold and non-USD assets; the soft-CPI rate relief helps gold reassert.",
"long_thesis": "The slow erosion of USD reserve share is the multi-year real-money gold bid."
},
{
"name": "Structural Deglobalisation & Trade",
"type": "enduring",
"dominance": 3,
"dominance_label": "MODERATE (3)",
"short_thesis": "Quiet absent a tariff headline; the tariff temp driver carries the near-term impulse.",
"medium_thesis": "Reshoring capex and industrial policy keep supporting XLI/XLB.",
"long_thesis": "A durable multi-year regime change in global trade architecture."
},
{
"name": "China Economic Health",
"type": "enduring",
"dominance": 3,
"dominance_label": "MODERATE (3)",
"short_thesis": "Q2 GDP + activity data (15 Jul) and tariff-letter headlines set the near-term EM tone; strong trade offsets the tariff overhang.",
"medium_thesis": "Policy support underpins copper and EM medium-term; CPI at 1.0% keeps a domestic-deflation caveat.",
"long_thesis": "Structural rebalancing caps the ceiling but a hard-landing tail persists."
},
{
"name": "Energy Transition & Electrification",
"type": "enduring",
"dominance": 3,
"dominance_label": "MODERATE (3)",
"short_thesis": "No dated catalyst; watch Silver Institute / grid-capex data. Hawkish real rates cap the metals short-term.",
"medium_thesis": "Persistent physical deficit underpins silver and copper.",
"long_thesis": "A multi-year electrification supercycle for industrial metals."
},
{
"name": "NATO Rearmament & Global Defense",
"type": "enduring",
"dominance": 3,
"dominance_label": "MODERATE (3)",
"short_thesis": "Budget headlines and procurement awards; a steady bid, reinforced by the live Gulf conflict.",
"medium_thesis": "Rearmament capex compounds over multiple budget cycles.",
"long_thesis": "A structural defense-spending supercycle."
},
{
"name": "Japan / Yen Carry-Trade Unwind",
"type": "temporary",
"dominance": 2,
"dominance_label": "BACKGROUND (2)",
"short_thesis": "No BOJ meeting in the window; watch JPY for a >3%/week spike as the unwind trigger. Carry stable while the Fed stays hawkish.",
"medium_thesis": "Carry stable while the Fed stays hawkish and the BOJ patient; the 23 Jul CPI is the tell.",
"long_thesis": "Unwind risk resurfaces whenever US-Japan differentials compress."
}
],
"asset_class_forecast": {
"Gold": {
"short": "N",
"medium": "O",
"long": "O"
},
"TIPS": {
"short": "N",
"medium": "O",
"long": "O"
},
"Silver": {
"short": "U",
"medium": "N",
"long": "O"
},
"JPY / Safe FX": {
"short": "N",
"medium": "N",
"long": "N"
},
"Defense": {
"short": "O",
"medium": "O",
"long": "O"
},
"Agriculture": {
"short": "N",
"medium": "O",
"long": "O"
},
"Oil": {
"short": "SO",
"medium": "N",
"long": "N"
},
"Copper / Ind Metals": {
"short": "N",
"medium": "O",
"long": "SO"
},
"EM Equities": {
"short": "U",
"medium": "N",
"long": "O"
},
"Long Treasuries": {
"short": "U",
"medium": "U",
"long": "N"
},
"USD": {
"short": "O",
"medium": "O",
"long": "U"
},
"US Equities": {
"short": "N",
"medium": "N",
"long": "N"
},
"US Tech": {
"short": "N",
"medium": "N",
"long": "O"
},
"High Yield": {
"short": "U",
"medium": "U",
"long": "N"
},
"IG Credit": {
"short": "U",
"medium": "N",
"long": "N"
}
},
"sector_forecast": {
"XLK": {
"short": "N",
"medium": "O",
"long": "O"
},
"XLF": {
"short": "O",
"medium": "O",
"long": "N"
},
"XLV": {
"short": "O",
"medium": "O",
"long": "O"
},
"XLY": {
"short": "U",
"medium": "N",
"long": "N"
},
"XLP": {
"short": "O",
"medium": "O",
"long": "N"
},
"XLE": {
"short": "SO",
"medium": "O",
"long": "O"
},
"XLI": {
"short": "O",
"medium": "O",
"long": "SO"
},
"XLB": {
"short": "N",
"medium": "O",
"long": "SO"
},
"XLU": {
"short": "N",
"medium": "O",
"long": "O"
},
"XLRE": {
"short": "U",
"medium": "U",
"long": "N"
},
"XLC": {
"short": "O",
"medium": "O",
"long": "O"
}
},
"watchlist_forecast": {
"SU.TO": {
"short": "O",
"medium": "O",
"long": "N",
"sector": "Energy (XLE)",
"reason": "Inherits Energy (short SO on the live Iran/Hormuz oil spike). Canadian integrated oil — direct beneficiary of oil ~+15% on the Hormuz closure; the live crude uptrend amplifies the short driver. Long fades to N as the premium is path-dependent (a ceasefire bleeds it out)."
},
"FANG": {
"short": "O",
"medium": "O",
"long": "N",
"sector": "Energy (XLE)",
"reason": "Inherits Energy; high-beta Permian E&P — moves 1.5–2× WTI, so the Hormuz supply shock is a direct short tailwind. Medium holds on a firm oil floor; long N as the geopolitical premium is not a durable multiple."
},
"EOG": {
"short": "O",
"medium": "O",
"long": "N",
"sector": "Energy (XLE)",
"reason": "Inherits Energy; premier US E&P, oil-levered FCF — a direct oil-shock beneficiary short/medium. Long N once the premium normalises; disciplined capital return underpins the floor."
},
"CSU.TO": {
"short": "N",
"medium": "O",
"long": "O",
"sector": "Technology (XLK)",
"reason": "Inherits Tech (short N on rate/valuation). Canadian vertical-software compounder — sticky recurring revenue, tariff-insulated, least exposed to the §1 AI-concentration tail; the core-disinflation rate relief is a mild short tailwind. Highest medium/long conviction of the set."
},
"MSFT": {
"short": "N",
"medium": "O",
"long": "O",
"sector": "Technology (XLK)",
"reason": "Inherits Tech; mega-cap AI/Azure carries the §1 concentration flag (part of the ~41% top-10) and is rate-sensitive short, but soft core CPI eases the multiple headwind and the AI-capex + FCF engine drives medium/long."
},
"IFC.TO": {
"short": "O",
"medium": "O",
"long": "N",
"sector": "Financials (XLF)",
"reason": "Inherits Financials (short O). Canadian P&C insurer — higher-for-longer lifts float/investment yield, domestic and tariff-insulated; the private-credit fault line is a mild watch, not a direct hit. Long N as the curve-steepening tailwind matures."
},
"GILD": {
"short": "O",
"medium": "O",
"long": "O",
"sector": "Health Care (XLV)",
"reason": "Inherits Health Care (short O). Defensive pharma — rate-insensitive, tariff-insulated, the actively-bid winner of the higher-for-longer defensive rotation; soft CPI + oil-shock risk-off both favour defensives. The cleanest short-term O of the set."
},
"MRK": {
"short": "O",
"medium": "O",
"long": "O",
"sector": "Health Care (XLV)",
"reason": "Inherits Health Care; large-cap defensive pharma with durable cash flows — same rate-insensitive, tariff-insulated defensive-rotation tailwind as GILD; oncology franchise underpins medium/long."
}
},
"sector_capital_flow": [
{
"sector": "XLE",
"flow_direction": "in",
"money_type": "real+fast",
"short": "in",
"medium": "in",
"long": "in"
},
{
"sector": "XLI",
"flow_direction": "in",
"money_type": "real",
"short": "in",
"medium": "in",
"long": "in"
},
{
"sector": "XLV",
"flow_direction": "in",
"money_type": "real",
"short": "in",
"medium": "in",
"long": "in"
},
{
"sector": "XLB",
"flow_direction": "in",
"money_type": "real",
"short": "x",
"medium": "in",
"long": "in"
},
{
"sector": "XLP",
"flow_direction": "in",
"money_type": "real",
"short": "in",
"medium": "in",
"long": "x"
},
{
"sector": "XLF",
"flow_direction": "in",
"money_type": "real+fast",
"short": "in",
"medium": "in",
"long": "x"
},
{
"sector": "XLRE",
"flow_direction": "out",
"money_type": "real+fast",
"short": "out",
"medium": "out",
"long": "x"
},
{
"sector": "XLY",
"flow_direction": "out",
"money_type": "fast",
"short": "out",
"medium": "x",
"long": "x"
}
],
"divergences": [
{
"asset": "Oil",
"real_stance": "hedgers fade path-dependent spike (fade)",
"fast_stance": "momentum-long the Hormuz premium (IN)",
"resolution": "the trade is closure duration; premium bleeds fast if Hormuz reopens"
},
{
"asset": "Gold",
"real_stance": "CB / de-dollar accumulation (IN)",
"fast_stance": "hawkish real-rate selling to 8-mo low (OUT)",
"resolution": "short capped on tape; structural bid reasserts medium/long"
},
{
"asset": "USD",
"real_stance": "de-dollar diversification (OUT, long)",
"fast_stance": "safe-haven + rate-differential (IN, short)",
"resolution": "fast wins short, real wins long"
},
{
"asset": "SPY vs RSP",
"real_stance": "broadening trade stalling",
"fast_stance": "re-crowding mega-cap AI",
"resolution": "concentration tail armed; index-level drawdown risk"
}
],
"calendar_events": [
{
"name": "PPI (Jun)",
"date": "2026-07-15",
"consensus": "MoM +0.2%",
"boris_forecast": "MoM +0.1% (revised down; June energy-soft window)",
"boris_confidence": "Low"
},
{
"name": "China Q2 GDP",
"date": "2026-07-15",
"consensus": "4.5%",
"boris_forecast": "~4.6% (trade strength offsets soft demand)",
"boris_confidence": "Medium"
},
{
"name": "BoC Rate Decision",
"date": "2026-07-15",
"consensus": "Hold 2.25%",
"boris_forecast": "HOLD 2.25%, data-dependent",
"boris_confidence": "High"
},
{
"name": "US Retail Sales (Jun)",
"date": "2026-07-16",
"consensus": "MoM +0.3%",
"boris_forecast": "MoM +0.2% (cooling but resilient; growth-pessimism bias)",
"boris_confidence": "Medium"
},
{
"name": "Housing Starts / Michigan (Jul)",
"date": "2026-07-17",
"consensus": "Starts 1.31M / Michigan 51",
"boris_forecast": "Soft — Starts <1.3M, Michigan ~50, expectations firm",
"boris_confidence": "Low"
},
{
"name": "Iran / Hormuz (rolling)",
"date": "2026-07-14",
"consensus": "Fragile; Brent $80-88",
"boris_forecast": "Brent elevated ~$82-92 (WTI ~$74-84); 60% Hormuz stays disrupted",
"boris_confidence": "Medium"
},
{
"name": "Canada CPI (Jun)",
"date": "2026-07-20",
"consensus": "3.0% YoY",
"boris_forecast": "3.0-3.1%; BoC-hold intact",
"boris_confidence": "Medium"
}
],
"tail_risks": [
{
"name": "S&P 500 concentration / AI earnings-quality unwind",
"status": "armed",
"breadth_tell": "top-10 ~41% of S&P, top-10 P/E ~50; SPY vs RSP re-widening",
"trigger": "AI private markdown / hyperscaler capex cut / Q2 mega-cap guide-down"
},
{
"name": "Hormuz full closure",
"status": "live",
"breadth_tell": "IRGC declared strait closed; US resuming Iran-port blockade (20% fee scrapped 14 Jul); tankers at a two-month low",
"trigger": "sustained closure -> oil spike + global risk-off"
}
],
"new_driver_candidates": [],
"date": "2026-07-14",
"scenario_weights": {
"Stagflation": 35,
"Soft Landing": 27,
"Reacceleration": 21,
"Deflationary Bust": 17
},
"confidence": "Medium",
"prior_regime": "Higher-for-Longer / Stagflation-lite — modest lead"
}