Yesterday’s market activity was relatively subdued despite the ongoing conferences and a handful of micro catalysts. Trading volumes were lower than the previous day’s pace, with the market tracking to finish around 20% below the 20-day average. However, there were some signs of underlying strength as momentum names saw coverage of short positions, particularly in the MoMo sector.

The HCare space was a notable exception, with our most short basket (GSCBMSHC) surging over 4%. Some of this upswing can be attributed to negative AI headlines, but biopharma names were also driving gains, up by 340% in CAPR, 6% in BMY, and 6% in VRTX.

Retail performance saw a welcome bounce back after a brief pause yesterday, with the focus on footwear strength and names like ONON (4.7%) and DECK (3%). This resurgence can be attributed to positive feedback from their meetings at a conference.

In our franchise, overall activity levels were down 14% compared to the previous two weeks, with market volumes up 21% against the 10-day moving average. Our floor tilts were slightly better, driven by LOs (5%), while Macro Products largely drove their buy skew. HFs were also 2% better to buy, with demand for Software offsetting supply in Semis and Pharma.

Overall, the market seems to be taking a breather after recent gains, but there are still pockets of strength emerging. Stay tuned for more insights and analysis as we continue to navigate these conference-filled days.