CNN’s fear and greed index is a crude if helpful tool to measure how scared the market is. Right now, according to the index, the market is more scared than it has been in six months, and I do not understand why.

I understand how CNN calculates the index, momentum, strength, breadth, etc. But I do not understand why people in the market are fearful. For example, the Middle East thing that just happened. An erratic major Middle Eastern power just sent a bunch of missiles and drones at an erratic other Middle Eastern power. And while that sentence could be copied and pasted every day for the past 30 years, the Iran/Israel beef was not a small event, especially because Israel has yet to retaliate. And yes, I just wrote about how this probably would not matter, but if the market is overvalued, an event like that would cause selloffs and fear would be justified.

Jerome Powell just said again that The Fed wants to hold off on rate cuts for a while after bad economic data, which should have caused a selloff were the market not strong. And on the topic of rate cuts, I no longer think we are going to get more than one this year if that. And I think the market also believed we are getting max one-rate cut this year, yet, they continue to push prices higher. And yes, we have shed a little bit over the past month or so, but generally, I feel like everyone feels good about where we are.

I mean, let’s look at a couple of major sectors real quick:

Auto is as cutthroat as ever, but hybrid sales are going through the roof. Toyota seems to be the big winner so far, as they will not stop selling EVs. The American car companies are struggling a bit, but I am not too worried on that front. They went too hard into EVs and are now paying the cost. However, they now have the technology for electric, and I do not doubt that eventually, this market will mature.

     Tech is a broad moniker, but it is serviceable because everyone feels good about tech. And while that is a mass generalization, I feel like a lot of worries have been quelled. After the post-COVID boom, investors flashed the signal that they were more than ready to head into profitable territory instead of infinite promised growth *cough cough* Elon Musk. These tech companies have chosen to become more profitable: Block, UBER, etc. and have reaped the rewards with increasing share prices. I am hopeful that these stocks can continue to compound, but if they can’t I could see an increase in worry in the market.

Financials is a bit of a mixed bag. Goldman just parked their gold yacht in the middle of Wall Street, while Bank of America just parked their poop yacht in the middle of Wall Street. Goldman saw their revenues and profits shoot up, and BOA saw its revenues and profits do about the opposite. But overall, I would say the IPO market is beginning to finally heat up again. I saw today in my prized Wall Street Journal, that StubHub is planning a massive IPO, a move that would fatten already rising investment banking profits at the top banks.

Communications stocks (media basically) are also doing well as streaming services seem to be turning a corner a bit as they start consolidating. Although my Disney-colored glasses could just be tinting my view of the industry. Cellular companies are not my area of expertise at all, but the markets seem to be lukewarm about them.

All I am saying is that there is no need to panic. There is no need to even panic about panicking. We have not missed any meals yet, and I would like for people to take a chill pill, especially the fear and greed index.