Tom Lee Calls the Bottom as VIX Signal Flips Back, Schwab's Gordon Pushes Back

Tom Lee is calling the bottom, and Monday's tape gave him ammo. The S&P 500 climbed 2.3% — its best session since April — to close at 7,549.94, and the Fundstrat managing partner says that rally backs his read that last week's selloff was the floor. His evidence sits in Wall Street's fear gauge: the Cboe Volatility Index term structure, which compares four-month and one-month readings, inverted last week and snapped back to normal on Monday. Lee says that kind of normalization usually marks a bottom, and he took the rally through a weekend of bad news as a healthy sign.

The call lands squarely on AI and megacap tech holders, who took most of last week's beating. Nvidia slid about 4% after its board opened a probe into CEO Jensen Huang's admitted affair. Lee had already been telling people to buy the AI dip, and he doubled down on CNBC: "I think markets are a lot safer than people think."

Not everyone is buying it. Kevin Gordon, head of macro research at Schwab, says a single strong day proves nothing. His better signal lives under the headline index — the equal-weighted S&P 500, where every company counts the same, kept outrunning the cap-weighted version through last week's slide. Nearly 60% of index members were still above their 200-day moving averages as of Friday, he said, and the real stress sat in leveraged tech bets that were in place before the midterm elections.

Gordon's point: megacap tech swings the index so hard that a cap-weighted pop says little about the average stock. Chris Hyzy, chief investment officer at Bank of America Private Bank, found his own footing in financials, pointing to their strength as a sign of coming deal activity and lending margins that remain intact.

Two things could settle the argument. Inflation data due this week could test the rebound, and a fresh VIX inversion would undercut Lee's read entirely.