Market Overview

Brokers and Retail Power

• Broker-dealer stocks have surged to new highs, driven by a boom in retail trading. Retail investors account for a significant share of market volumes, especially with over 60% of options trades now in zero day to expiry products.

  

   

• Recent crypto regulations and the introduction of new ETFs, especially in Ethereum and Bitcoin, are fueling additional volume and brokerage revenue.
• Despite sideways action in the past 10 days for major indices, both the S&P 500 and Nasdaq are up 7-8% year-to-date; Europe is showing similarly strong performance.
• Asset class performance: The dollar is down 10% for the year, Bitcoin is up 25%, gold up 27%, and copper remains strong due to new tariffs.

  

   

Sector & Industry Breakdown

Week-to-Date Sector Moves

• Winners: Aerospace & defense, software, metals, and mining stocks outperformed.
• Losers: Oil services and healthcare equipment lagged.
• Industrials are up over 15% year-to-date, reflecting market confidence in ongoing GDP growth.
• The technology sector has gained 12% year-to-date.

  

   

Market Dynamics & Sentiment

Interest Rates and Volatility

• The 10-year yield hovered between 4.3% and 4.5%.
• Inflation data (CPI, PPI) showed signs of easing, while retail sales continued to impress.
• The VIX (market volatility index) remains subdued, signaling a risk-on environment and aggressive volatility selling by institutions.

Federal Reserve Outlook

• The market expects no change at the upcoming Fed meeting in 10 days.
• Probabilities for a September rate cut are around 50%, with only a modest two possible cuts priced in by year-end.
• Fed policy has become less accommodative as economic indicators and earnings remain robust.

Technicals and Leading Stocks

Index Trends

• Both the S&P 500 and Nasdaq continue to set all-time highs, albeit in narrow trading ranges.
• The Russell index is catching up, with levels of interest flagged at 2,250 and 2,300.

Crypto Surge

• Ethereum has rallied nearly 50% in two weeks following regulatory changes and new ETF launches, pushing the broader crypto space higher.

  

   

Key Stock Performers

• Microsoft: Since its last earnings gap, the stock has steadily advanced from $425 to $510, demonstrating persistent earnings momentum.

  

   

• Roblox: Jumped from $60 to $124.50, doubling in value since its lows. Volume spikes and upgrades from major banks support this move. (log chart)

  

   

• Robinhood: Broke out at $67 and now trades around $110, rising 50–60%. Despite strong gains, some profit-taking appeared on high volume last Friday. (log chart)

  

   

• GE and Spin-offs: GE has been rerated dramatically since its spin-off, with the forward valuation now at 33–38x 2026–2027 EPS despite little change in earnings forecasts.

  

GE last (lhs) vs 2026 EPSe (rhs).

GE Fundamentals.

Upcoming Catalysts

• Earnings Season: Major companies reporting in the next weeks include Coca-Cola, Intel, Tesla, and Google.
  • So far, 60% of sales and 80% of EPS have beaten estimates, but stocks missing on sales or profits are being punished more than usual.
• Macro Events: ECB rate decision and flash PMIs on Thursday. Little is expected from the Fed until their next meeting due to the blackout period.
• Political Watch: Japan’s elections will impact global bond markets.

  

   

Trading Insights

• Retail traders currently drive short squeezes in non-profitable tech and heavily shorted names, propelling them over 10% in a week.

  

   

• Volatility is historically low, with implied moves for the S&P 500 now under 2% per week, and persistent downward trends.
• The market is showing some complacency heading into earnings, potentially underpricing event risk

   

  Community & Mentoring

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