It looks like we’ll have a modest bounce, today, and I expect that’ll carry over to US markets later tonight. The drawdown to Friday takes the decline to ~6%, not nothing, but, in context of the 26% run in the twelve months prior, very little.

The below graph reminds us that drawdowns, on average, tend to be a touch over 10%.

Charlie Bilello has a nice table that (essentially) takes our table above and annotates it.

No great takeaway other than to say, thus far, the drawdown isn’t enough to trigger a DAA move. It certainly may well become big enough, and it would only take a day or two worth of escalation in the Middle East, or alternatively, ongoing stubbornness in the PCE inflation data (as opposed to the CPI data, where it is already stubborn) to get us there, in which case we’ll revisit.

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