Volatility Pulse - The kids are alright
AI is a good scapegoat
Artificial intelligence was the single most-cited reason for announced US job cuts in July at 10,970, and 112,713 so far this year -- ahead of market conditions, restructuring and cost-cutting. Total layoffs still fell 46% from a year ago.
Source: Challenger, Gray & Christmas
Nobody Mentioned The Hiring
Employers announced plans to hire 16,095 workers in July, up 47% from June and the strongest July in four years, with 107,500 planned so far this year against 86,132 by this point last year. The layoff headlines got the attention; this line didn't.
Source: Challenger, Gray & Christmas
The Robots Skipped The Kids
Unemployment for 20-to-24-year-olds fell to 7.1%, down from 9.2% late last year and back to where it sat in 2023. The story that AI is eating entry-level work may not be showing up in this particular number yet.
Source: FactSet via Ryan Detrick
Seventeen Cents On The Dollar
The S&P 500's net income margin has reached roughly 17%, up from about 10% a decade ago and 8.5% at the 2020 low. Companies are keeping more of every dollar of sales than at any point on this chart.
Source: Bloomberg
Your Raise Got Smaller
Average hourly earnings rose just 0.1% in July and are up 3.15% from a year ago, the slowest pace in more than five years. Profits per dollar of sales went the other way.
Source: Discipline Funds via Cullen Roche
All Eleven Sectors Grew
Second-quarter revenue for the S&P 500 is tracking 15% growth from a year ago, the strongest since the end of 2021, and every one of the eleven sectors is expanding -- energy at 42.5% and technology at 35.9% out front. Broad, not narrow.
Source: FactSet
Two-Thirds Of Everyone's Profits
The US share of operating profits across the entire OECD climbed from about 45% in 2022 to roughly 66% by the middle of 2025. One country, two-thirds of the developed world's corporate earnings.
Source: Simon White, Bloomberg
The Software Crash That Wasn't
The equal-weighted S&P software index is trading within a few percent of its all-time high, after a round trip that took it from roughly 210 down to 140 and most of the way back. A sector that spent the year being written off is sitting near the top of its range.
Source: JC Parets, TrendLabs
Small Caps Stopped Losing
For three years the Russell 2000 trailed the S&P 500 by an average of 5.9 points on a one-year basis. In June it was ahead by 21.7 points -- a two-standard-deviation swing -- and it still holds a 14.5-point lead.
Source: Nick Colas, DataTrek Research
Groceries Are Climbing Again
The global food price index rose again in July to its highest level since January 2023, with trade routes, weather and supplies all in play. Still roughly 19% below the 2022 spike, but heading the wrong way for shoppers.
Source: UN FAO via Bloomberg
Most Bullish Since 1997
A long-running advisor sentiment survey shows 79% bulls, the highest reading since the summer of 1997 -- just ahead of the Asian currency crisis. Thirty-five years of history, and only one print above it.
Source: Market Vane via Chartfest
Just Because...
Planet Earth Called - It's Been Bleeding for 2 Million Years
Antarctica has a five-story blood-red 'waterfall' called Blood Falls - a prehistoric saltwater lake trapped under 400 meters of glacier ice, three times saltier than the ocean, bleeding iron-rich brine that turns bright red the moment it hits air. Scientists couldn't explain it for over 100 years.
