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September has not been friendly towards equity investors. The Standard and Poor’s 500 Index has posted its first decline of greater than 10% for the first time since the 3/23 trough near 2,200. That level was not only the nadir for 2020 but also the lowest point for equities going back to 4Q16.

Although this is the first double-digit drawdown over the last six months, it is the fourth decline greater than 5%. And all other 5% declines represented dips and buy opportunities within the context of an ongoing recovery rally.

The most important underpinnings of our expectation for even higher highs for the equity markets are still very much in place. The Fed has clearly signaled it is on hold for an extended period and the favorable liquidity environment will not be interrupted. Interest rates remain near record lows which is supportive for equities.

The earnings revisions data, as shown by our proprietary Analyst Sentiment Measure (ASM), is still robust. It shows that the rate of change in the depressed future profit expectations, which were consensus in late-March and early-April, is still getting less bad for the universe of names within the both the S&P 500, as well as the S&P 1500.

Granted, some other factors have helped create some tactical headwinds for t...

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