Gareth Soloway argues that hotter-than-expected PPI confirms stubborn inflation, supports a stagflation risk, and pressures equities, especially after Nvidia and chip names failed to respond well to strong earnings. He leans bearish on the S&P and Nasdaq near term, while highlighting select oversold stock bounces and cautious positioning in commodities like silver, gold, oil, and natural gas.
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This is a solo market update from Gareth Soloway of Verified Investing. He opens with a bearish macro read after a hot PPI print (headline and core both above expectations), saying inflation is not returning to 2% and that this will make the next Fed chair’s job harder. He frames the market reaction as consistent with stagflation risk: equities under pressure, 10-year yields falling below 4% because the market is increasingly pricing in economic weakening, and a broad backdrop of uncertainty from tariffs, geopolitical risk, layoffs, and rising debt. Technically, he focuses on the S&P 500 and Nasdaq. On the S&P, he describes a rounded-top/distribution structure and says a head-and-shoulders-style breakdown around 6790 could trigger a sharp move lower within about a week. …
Immediate setup is bearish risk into the close: hot inflation data and weak index structure keep the S&P/Nasdaq vulnerable to a downside acceleration if nearby supports give way. Best tactical watch is whether the selling broadens after the PPI reaction or whether dip-buying stabilizes the tape.
Over the next several weeks, the base case is a choppy-to-lower market unless inflation cools and yields stop signaling growth weakness. Confirmation would come from repeated support failures in the major averages and continued poor post-earnings reactions from leaders; a durable rebound would require the opposite.
Structurally, he is arguing that the market is entering a stagflationary regime where inflation proves sticky while AI and cost-cutting pressure labor. If that regime persists, it would favor commodities and scarce assets over richly valued growth stocks, though the transcript frames this more as a risk than a settled certainty.
Hot PPI data confirms inflation is still running above expectations and is not returning to 2%.
He cites PPI 2.9% YoY vs 2.6% expected and 0.5% MoM vs 0.3%, then says inflation is not going back to 2%.
The market is increasingly pricing in stagflation rather than a clean disinflation path.
He explicitly says stagflation is the risk and ties hot inflation plus weak market action to that scenario.
The S&P 500 is in a rounded-top distribution phase formed by institutional selling.
He says the chart has been chopping for months while institutional money sells into retail buying.
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