Equities were mixed as small and mid-caps gave way to large caps. Markets took Fed Chairman Warsh’s comments as “hawkish” at last week's Economic Symposium in Jackson Hole, Wyoming. His comments were taken as "hawkish" by the market.1 During his speech, Warsh stated that while Summer readings on inflation were better than expected, the readings "do not tell me that underlying trends have 
meaningfully improved."1 This caused the Fed Futures to flip. Last week, there was a 60% probability of no rate hike at next month's Fed meeting.2 Today, there is a 60% probability of at least a 25 basis point rate hike.2 Investors will be paying attention to the Jobs Report this week to try to glean some kind of idea as the fate of interest rates next month. It was thought that the U.S.-Iran War was taking a new turn in the direction of economic intervention and less military operations. Treasury Secretary Bessent announced last a new initiative based on economic warfare.3 The focus of the new economic sanctions exceed just an oil embargo against Iran, incorporating other assets and areas 
of profit. Some progress became visible last week as ships passing through the Strait of Hormuz have reached 1-month highs, as evidenced in the graph above. In addition, oil exported from the region reached nearly two-thirds of pre-war levels last week.4 However, as has been the pattern during the conflict, tensions broke out over the weekend which could undo some of the progress made in the region.5 Concentration at the top of the market continues to be a theme this year as investors face similarities to previous eras of market clusters. 
The "Nifty Fifty" of the 1970s reached a concentration level of approximately 40% capitalization at the top of the market and 50 stocks made up the majority of institutional portfolios and mutual funds.6 This year, we've seen a similar build-up in concentration among the top 10 AI names, as evidenced above. Concentrations such as this can serve as a healthy warning to investors, although, the beginning and ending of each concentration event tends to differ. While the future cannot be seen, there is a reasonable case to be made for investors to manage their respective risk tolerance wisely during periods of over-concentration in the equity market when just a few names make up such a large portion of growth. History does have a way of repeating itself.
https://www.zerohedge.com/markets/watch-live-fed-chair-warsh-delivers-keynote-address-jackson-hole
https://www.zerohedge.com/geopolitical/iranian-gasoline-shortages-grow-us-blockade-bites
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