Hartnett: Markets Sold "The Last Fed Hike", Now Are Frontrunning "The First Negative Payroll And First Rate Cut"

One week after informing his readers that the Bank of America buy signal (that was accurately triggered in mid-October just ahead of the torrid year-end rally) ended last week, risk assets were on the verge of taking out support on not one but two occasions, and yet in the end a powerful thrust of post-payroll buying managed to push stocks to new 2023 highs.

What happened today, besides the previously discussed goldilocks jobs number? Well, according to Goldman's trading desk, "we continued to see a widening of breadth in Tech from long onlies -- it started in Software and is now expanding into semis. L/Os finished +21% better to buy, adding an incremental ~$2b in net demand – this is the highest buy skew since Oct 17th and ranks in the 89th percentile over the last 52 weeks. Demand was broad across sectors though most pronounced in info tech (semis / software), financials, and industrials." Hedge funds, meanwhile, finished -4.8% better sellers, driven by an uptick in short supply across macro products, comm services and industrials. Still, with L/Os flows stable, and hedge funds no longer selling tech, Goldman notes that "we are at a clear inflection point" while there’s clearly a systematic / retail bid out there for laggards (part of the previously discussed rotation).