Warren Pies
@WarrenPies
Founder @3F_Research | PM $RAA | $FCTE | Formerly with Ned Davis Research | Recovering Attorney (step 4) - Not investment advice
1.9K Following 78.7K Followers
Semis + Mag7/Hyperscalers up together today.
This has been a rarity this year (semi vs hyperscaler correlation at an all-time low).
The recipe for new S&P 500 highs is hypers + semis rallying together.
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"Removing a dose of accommodation" points toward an unwind of last year's 75 bps of cuts.
Will the Fed hike in September?
@acemoney21 @labubu_trader Anything can happen, but history (both longer term and short term - see below) points to the 10y moving along w/ fed expectations.
This 👇
Not sure why the 10y yield should go down if the Fed starts hiking (setting aside any near-term volatility)
FED
It's popular to suggest the 10y yield will fall if the Fed hikes rates this week.
Unless this is a "one and done" hike, though, history suggests the 10y will rise as the hike cycle progresses.
The 10y has risen in every modern hike cycle (especially early in the cycle).
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This one was a real conversation starter ha
“.. S&P 1500 Software revenue per employee has gone parabolic. If you are looking for evidence that AI is starting to impact the real economy, this is exhibit A.”
(via OpCo desk) @3F_Research
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This is the correct take
Here.
Why don't you actually learn something today.
FED
It's popular to suggest the 10y yield will fall if the Fed hikes rates this week.
Unless this is a "one and done" hike, though, history suggests the 10y will rise as the hike cycle progresses.
The 10y has risen in every modern hike cycle (especially early in the cycle).
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S&P 1500 Software revenue per employee has gone parabolic.
If you are looking for evidence that AI is starting to impact the real economy, this is exhibit A.
Warren always grinds
Great chart.
S&P 500
To make new highs, the market needs semiconductors to get into gear.
YTD, the S&P 500 is up ~60% on days when the semi industry is positive. But, the S&P 500 is down ~30% on days semis are down.
No other industry has had this large of an effect on the index in 2026.
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Looking back, Warren's insight here was among the best of the past 5 years. So much change. #fintwit# #econtwit# @cnbc @WarrenPies
A good chunk of the stock market is trading like a bet against semis.
Across all stocks, the 10th percentile correlation with semis is the most negative in 35 years.
I used a new alerting feature we added to Caliban to chart it and let me know if the relationship changes.
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CPI above the Waller line...Hike is coming.
At 38%, I think a September hike is underpriced here.
Personally, I believe that holding is the appropriate policy. However, the committee is increasingly feeling the political pressure of persistently missing its inflation target.
You can see this in Beth Hammack's recent commentary (below). Her arguments are emotional and political. They lack substantive views on the forward path of inflation/labor. This is the mindset that produces policy mistakes.
Oil/gas is the most prominent price in our economy. Their continued rise from the July lows is going to increase the political pressure on the FOMC. Today's CPI data is not decisive enough to offset the political dynamics imo.
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Not a single forecast above the "Waller line" of .25%.
This is what the agentic AI capabilities unlock did to semiconductor earnings estimates in 2026. Is that the last capability breakthrough that will pull forward adoption and surprise analysts this much?
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OIL
-Brent futures >$100 (new post-Iran high).
-Dated Brent >$108 (DFL >$8/bbl...i.e. physical tightening).
Going back to the end of August, the paper market was starting to flash buy signals.
Below is a clip from the @3F_Research 8/27 Model Update.
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OIL
Shanghai crude futures above Brent Crude for the first time since May.
China's buyer strike has been the most important reason oil prices have remained subdued during the Iran War.
It seems China is buying again now...
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