After stumbling into the long weekend, Tech stocks- in particular the semis/hardware names- bounced on Monday, pushing the S&P 500 up 0.8%. Unfortunately, speaking of stumbling, the US Men’s National team lost last night to Belgium, ending their World Cup run. We turn our sports attention back to the Yankees who are also in the midst of a pretty big stumble themselves. Comm Services, Info Tech and Consumer Discretionary led the markets higher. Meanwhile, Thursday’s leadership- Healthcare, Utilities, Staples and Real Estate- lagged. The Russell 2000 rose 0.5% while the equal weight was flat. Treasuries were flat-to-lower while Bitcoin rose about 2% to ~$64K despite Strategy disclosing it sold >$200ml.

Major indices opened modestly lower, but the momentum unwind picked up steam. That unwind left not only semis/memory and other AI adjacent stocks in its wake, but other themes have moved sharply lower as well including rare-earths, robotics, space and quantum. Once again, we’re not seeing a mass exodus from equities but there is what feels like a mechanical rotation with mega-caps and defensives once again leading to the upside. Looking at the movement of speculative capital - as AI unwinds, we’re seeing some positive action in software and crypto two areas of the market that have been left for dead. As we head to print the S&P 500 is only down ~0.25% as the mega-cap tech names have bounced despite the ICE Semi index trading off >4% (unwind of the follow the money trade). The equal-weight is hovering around unchanged with adv:dec in the index ~1.5:1.