Financial News vs. Noise
Market started off strong on Friday only to selloff into the close. The Magnificent 7 was down across the board, except TSLA which was up slightly. Speaking of TSLA, if you are into breakouts it looks interesting, especially if it can clear it’s 200 day.
In AI, NVDA is down again this morning and it looks like it is going to open below it’s 20 day EMA. Be interesting to see if the other AI names can move higher without them joining in. Speaking of AI, keep an eye on this. Larry Connors puts out a great AI report every week, and on Sunday he talked about nuclear. Always one to be ahead of the curve on this stuff. Tech Industry Wants to Lock Up Nuclear Power for AI-WSJ
Tech companies scouring the country for electricity supplies have zeroed in on a key target: America’s nuclear-power plants.
The owners of roughly a third of U.S. nuclear-power plants are in talks with tech companies to provide electricity to new data centers needed to meet the demands of an artificial-intelligence boom.
Among them, Amazon Web Services is nearing a deal for electricity supplied directly from a nuclear plant on the East Coast with Constellation Energy CEG -2.20%decrease; red down pointing triangle, the largest owner of U.S. nuclear-power plants, according to people familiar with the matter.
I bought the dip in CEG on Friday, a bit too early, and am looking to add on any dips.
The forecast demand from data centers and electric vehicles alone through 2030 is equivalent to the entire electric demand of Turkey.
Speaking of NVDA. No Nvidia in Your Portfolio? ‘You’re Just Toast’ The average stock in the S&P 500 is lagging behind the index by most since at least 1990-WSJ
Much of the rest of the index has languished. The average stock within the S&P 500 is up 4.1% this year, while the broad index is up 14.5%. That is the largest underperformance since at least 1990, according to Dow Jones Market Data. Six of the 11 sectors in the index declined in the second quarter, including financials, energy and industrials.
In tech, strength has shifted towards software as the semi’s have cooled off.
ABDE especially. After getting crushed on earnings and being left for dead it’s come back with a vengeance. My overreaction model actually went short on Friday, but if I was trading this on a discretionary basis would be using the 200 day as a sign one way or the other.
Microsoft and 3 More Stocks to Play a Software Rebound-Barron’s
Other strategists similarly think investors shouldn’t avoid software: Earlier this week 22V Research argued much the same, and at the start of the month Capital Economics argued that the preference for semiconductor stocks likely wouldn’t last forever.
With the first half of the year drawing to a close, AI momentum looks likely to keep driving the market’s direction, and potentially begin to bring software along for the ride once more.
The Mag 7 Trade Is Aging. Software Is New Again.-Barron’s
That’s a sign that market sentiment toward software may have started to shift, especially as investors begin to identify companies that can benefit from AI, including Adobe, Salesforce, and ServiceNow. “We think the inflection for software stocks is more than just a short-term sentiment swing,” Cossel writes.
Some other previously lagging areas are looking strong. Regional banks…
Transports
Is this the start of a broadening out? Of did these areas just get beaten up so much they were due? Doubt we get any real answers in a holiday shortened week.
Speaking of broadening out, this from BTIG….
The equal-weight S&P 500 (SPW) has underperformed the SPX by nearly 10% over the first six months, one of the worst such stretches on record back to 1990 and by far the worst 'first six months' of the year. If small-caps are going to work, we think they have to start soon or they become the 'canary in the coalmine' rather than a rotation opportunity. At this point small-cap growth (IWO) looks better than value, but it's still in a 'show me' state.
Don’t forget about GEO. ‘Trump’ Stocks Are Rising: Banks, Managed Care, Steel-Barron’s
Nothing that interesting on my watchlist today. Looking to possibly add to MU and CEG on further dips. On the short side I have ADSK.
Of course these will expand. You can go completely broke, but only if you are a moron and you put all your money into one of these things. These are a tool, just like any other tool. The fact that they come out every day offers some strategies that you can’t do with other tools. Wall Street’s Hottest Lottery Ticket: Zero-Dated Options Bets on market moves have taken off with these options. Stocks like Nvidia and Apple could be next.-Barron’s
Hate to break it to you, but whether Trump wins or not, Social Security and Medicare are in trouble. You should be saving anyway. Opinion: Another Trump presidency spells trouble for Social Security and Medicare. Start saving now.-MarketWatch
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