The S&P 500 surged 2.63% last week, closing Friday at a fresh all-time high and leaving an unfilled gap from Wednesday open.
This gap highlights the ongoing tug-of-war between bulls and bears. To navigate the eventual pullback, watch sector rotation closely: if capital shifts from XLK to other areas rather than fleeing to cash, expect a sideways grind rather than a sharp drop.
Comentario en Español en este link: https://mariorandholm.substack.com/p/el-ciclo-del-sp500-no-se-rinde?r=293tyd&triedRedirect=true
NYSE Breadth Stays Resilient
Since April 6, NYSE stocks—fueled by AI momentum—have shown relentless strength through May, with more names hitting highs than lows.
AI Narrative Broadens Beyond Nvidia
The AI story now spans the full value chain, not just Nvidia’s GPUs. Spotting innovation across the stack keeps us hunting entries in emerging leaders.
Nine top AI-related stocks have doubled in the past year: MU, SNDK, AMD, INTC, GOOGL, STX, ASML, AMAT, DELL. Three are memory plays (Micron, SanDisk, Seagate)—once seen as purely cyclical.
Lisa Su’s case for agentic AI points to exponential CPU growth, driving demand for memory bandwidth.
Not Just a U.S. Story
Monitor for cracks in semis: slowdown signals will first hit equipment makers like AMAT and LRCX, not memory firms. Revenue trends remain upward, with analyst forecasts showing potential growth deceleration by late FY2027—but still positive.
Markets may or may not discount this yet—we’ll see.
Fed’s Hands Tied
Labor data stays firm, so no Fed rescue needed. Tuesday’s CPI is eyed at 3.7% YoY (up from March’s 3.3%), core at 2.7% (from 2.5%). Oil-fueled inflation and three FOMC dissenters keep cuts distant—no hikes expected, but patience required.
Oil: Key Risk to Watch
Crude is down 20% from Iran tension peaks but up 42% from pre-shock levels.
OIL Correlation with equities has broken, but persistent mentions in earnings could disrupt AI capex—and refocus markets negatively.
Best,
Mario Randholm
