On Friday the S&P 500 closed below its 50d ma for the first time since early April while most other major US indices were holding around all-time highs - highlighting the underperformance of the mega-cap tech stocks amidst increasing concerns around AI Capex spending. Yesterday there was a reprieve in that dynamic with tech bouncing back while the rest of the market ended around unchanged. There were a flurry of headlines across the media and telecom while Alphabet’s 5% gain provided a solid boost to the Dow Jones Industrial Average as it debuted in the index. There was a risk on tone with defensive/yield-oriented sectors, which had been outperforming recently, pulling back. Some the thematic favorites rallied with space leading the way after the Rocket Lab deal to buy Iridium Communication. Crypto also stabilized after Strategy announced several initiatives, including some to support the STRC perpetual preferred.

Today is month and quarter-end so we could elevated volumes and volatility. It was a reasonably quiet overnight session as thoughts about barbeques and fireworks start to detract from investor attention spans. The US envoy landed in Doha but reportedly will not be meeting with Iranian officials. From a market perspective Iran has clearly become a secondary concern as oil prices have moved sharply lower over the last few months. As of mid-day markets are looking to end the quarter on a solid note. Semis have outperformed across pretty much every time frame this year so it is fitting that they are leading the way again today. Otherwise the sector performance is very similar to yesterday.