10 Things You Need to Know – Queen Cathie Wood Edition!
What a week! Here's what happened:
- President Trump cyber-bullied Fed Chair Jerome Powell, demanding faster rate cuts
- The US and China signed a trade deal allowing rare earth exports from China and an easing of US tech restrictions
- The S&P and Nasdaq slammed the bulls with a move to all-time highs
- Inflation showed continued signs of easing
- The US dollar dumped
- Uranium soared as nuclear power comes back en vogue
- Gold dropped like a rock, and yes, it is a rock
- Cathie Wood's ARKK ETF showed continued dominance
And a whole lot more!
So let's dig into the 10 Things You Need to Know About Markets Right Now – Queen Cathie Wood Edition:
1. Tech Led Us to Record Highs
The S&P 500 and Nasdaq hit all-time highs this week as tech stocks took center stage.
35 S&P names, including NVIDIA (NVDA), Microsoft (MSFT), Broadcom (AVGO),
Oracle (ORCL), and Netflix Inc. (NFLX), and Palantir (PLTR), hit record highs.
As of Friday afternoon, QQQ was up 7.7% on the year:
And if we have to crown a Queen… it's Cathie Wood:
2. ARKK Is Dominating!
Cathie Wood's ARK Innovation ETF (ARKK) is up nearly 24% this year, crushing the major indices:
ARKK has made a stunning comeback off the April lows thanks to hefty positions in winners like:
- Coinbase (COIN)
- Tesla (TSLA)
- Roku (ROKU)
- Roblox (RBLX)
- Circle Internet Group (CRCL)
Yes, Circle is off its highs… but it's still up huge from its January 5 IPO.
Well done Cathie!
But even with all the high-flying stock action…
3. Investors Don't Trust This Market
The latest AAII Sentiment Survey shows that 35.1% of investors are bullish.
This is off the lows from earlier this year.
But it's below the long-term bullish average of 37.5%.
We haven't had an above-average bullish reading since January 29, when 41% of investors are bullish.
Rallies are built on doubt, and blow-off tops are driven by a euphoric mood.
There are few signs of either.
4. Homebuilders Might Be Sending Smoke Signals
Last week, we pointed out the mystery in homebuilding stocks.
Lots of folks are talking about soft housing demand and growing supply.
But the SPDR S&P Homebuilders ETF (XHB) popped almost 5% this week.
Could markets be sniffing out rate cuts already?
It's hard to say.
President Trump's been loud and clear that he wants lower rates, and has been ranting and raving about Fed Chair Powell's measured approach.
The Wall Street Journal reported that Trump may name the next Fed Chair early to undermine Powell.
So what's the market saying about rates near-term?
5. July Rate Cut? Outlook Not So Good
As of Friday afternoon, the CME's FedWatch Tool was pricing in an 18.6% chance of a July rate cut:
The outlook for the September Fed meeting is different.
The market is pricing in a 77% chance of 25 bps in cuts by then, and a 17% chance of 50 bps in cuts.
But, the economy is humming along and equity markets remain strong, even in the face of the trade war.
The real question may be “will the Fed step in BEFORE things break?”
I can't answer that question. Can you?
6. Next Week SHOULD Be Sleepy
The market closes early Thursday and it shut on Friday for the July 4 holiday.
So the calendar is light:
Does that mean we're in for a sleepy week?
Maybe not.
Remember, we don't know what could happen with the trade war or Middle East conflict.
The President has a knack for keeping things “interesting.”
And volume could be light, exacerbating volatility.
If you think you can take it easy into the holiday, you better think twice.
7. Uranium DID NOT Fill the Gap
Last week, we pointed out that the Global X Uranium ETF (URA) looked like it might fill its June 16 gap up.
It did not!
On Monday, New York Governor Kathy Hochul announced plans to build a new nuclear facility.
This comes amid the backdrop of a friendlier regulatory environment for the nuclear industry.
The AI boom is also driving increased electricity demand, and companies like Meta (META), Amazon (AMZN), and Microsoft (MSFT) have struck nuclear power deals.
The Washington Post reported that Former Texas Governor Rick Perry's company Fermi America just laid out a proposal for four new nuclear reactors near Amarillo.
The result: URA is now up 42% YTD, crushing every major ETF, including ARKK, which we discussed earlier.
8. Super Micro's Short Squeeze Is Epic
Last weekend, our buddy Sami Abusaad called Super Micro (SMCI) “trashy.”
He also said the stock looked great, and that it could hit $65:
SMCI opened Monday morning at $43.47 and fell to $40.77.
Now it's at $47+.
What's driving the stock?
Well, tech stocks and AI names have been rocketing higher.
And SMCI's short interest is 16.2%, the third highest of any stock in the S&P 500 Index:
Keep it on the radar.
9. Gold Has Been Dropping Like the Rock That It Is
I almost wrote “gold is dropping like a rock.”
And then I realized gold is a rock.
Whatever.
It's been in absolute free fall thanks to improving US-China trade relations and an easing of Middle East tensions.
Given how far gold's come, it could have a long ride down if good news keeps coming.
10. You Can Master the 20 Day Moving Average NOW
Sami Abusaad is an amazing trader.
Why?
Because he keeps things simple, with 2 indicators and nothing else. not even volume.
Learn about his favorite one, the 20 day moving average, now.
And stop missing the biggest moves in the market:
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