Recession Watch: Growth Losing Momentum

Damir Tokic12.68K FollowersFollow5ShareSavePlay(8min)CommentsSummaryThe PMI flash report for December is showing that the growth is losing momentum, and the weakness is likely to extend into 2026.The unemployment rate increased to 4.6%, above the Fed's 4.4% prediction for 2026, but high inflation expectations could prevent the Fed from further easing.Investors are rotating from the AI trade to cyclical sectors, but this rotation trade could blow-up if the data continues to deteriorate.

Getty Images Tracking the data My 2026 outlook for the S&P 500 (SP500) is a recessionary bear market with the AI bubble burst. The AI bubble is already in the process of bursting; however, this is a very early stage ofThis article was written byDamir Tokic12.68K FollowersFollowCommodity Trading Adviser (CTA), member of National Futures Association. Professor of Finance, research on Global-macro issues. Editor-in-Chief, Journal of Corporate Accounting and Finance.Analyst’s Disclosure:I/we have a beneficial short position in the shares of SPX either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.