Wall Strut<\/p>\n
US equities pushed ever higher overnight, with the S&P500 delivering its 30th record high this year.<\/p>\n
Wall Street gains have hardly ever been this lopsided as Mega Tech accelerates into the ether while other risk assets basically stand on the beach and watch.<\/p>\n
It seems punters were unwilling or unable to sell in a thin market with Juneteenth National Independence Day being celebrated on the 19th \u2013 we could see something similar into the EOFY.<\/p>\n
The S&P 500 hit a fresh record on Monday, bringing its year-to-date gain to more than 14%.<\/p>\n
The great jostling bulk of those muscular gains comes from the usual seven suspect major US tech companies tied to AI, such as Mr Nvidia \u2014 who has more than tripled in weight so far this year.<\/p>\n
Last week on Wall Street, the S&P500 (SP500)\u00a0 clocked its best weekly advance in\u00a0 six weeks largely on the back of surprisingly soft inflation data. The always exciting\u00a0headline consumer price index for May came in flat in what was its first unchanged reading since July 2022.<\/p>\n
For the week, the S&P500 added +1.6%, the blue-chip Dow (DJI) fell -0.5%.<\/p>\n
The tech heavy Nasdaq Composite climbed a lazy +3.2%.
\n\u00a0<\/p>\n
Over the past two years, the S&P500 Growth Index has surged by over 57%, surging beyond the broader\u00a0 S&P500\u2019s still exemplary 43% leap.<\/p>\n
In the past four weeks the growth index has outpaced value by nearly 9%.<\/p>\n
Nvidia Corp (NVDA) has added another fairly astonishing circa 37% after a busy month which included the Q1 earnings mega beat and stonking Q2 forward guidance, and it hasn\u2019t missed a beat since the recent 10-for-1 stock split.<\/p>\n
With generative AI driving robust sales in both infrastructure and SaaS layers, Nvidia is sitting pretty to continue swallowing up further market share and profit growth.<\/p>\n
Down the road, Broadcom Inc. (AVGO), another cunning AI chip designer in the NVDA school of gen-AI, watched with glee the success of NVDA\u2019s split and itself announced last week a 10-for-1 forward stock split which goes into effect in one month on July 16.<\/p>\n
AVGO stock hit $1714 on Friday, 30% higher than the start of the month.<\/p>\n
Via Google<\/p>\n
Broadcom is starting to get its name up in lights on Wall Street as not a bad option on the alt-AI front \u2013 especially considering Broadcom\u2019s revenue rose 43% year-on-year to $12.487bn, an easy beat on market\u2019 expectations.<\/p>\n
More significantly AVGO hoisted forward revenue guidance to $51 billion based on increasing demand for its AI chips.<\/p>\n
The key here is \u2013 like NVDA \u2013 the company has some thrilling cash flow numbers and in a world of mighty valuations looks comparatively cheap, according to concensus expectations, even despite its recent stunning gains.<\/p>\n
\u00a0<\/p>\n
Out front of the US-tech trendsetters, AI-related companies are looking unflustered by the last 12 months of ever-increasing and undeniably eye-watering valuations.<\/p>\n
But while fundamental factors around these names are supportive of their multiples, the market isn\u2019t entirely free of fear, Charles Schwab chief investment strategist Liz Ann Sonders told US media overnight.<\/p>\n
\u201cAI and its enthusiasm \u2014 I think that\u2019s very legitimate,\u201d Sonders said. \u201cAt this stage in the game, the trajectory of earnings, you could argue, is supportive of valuations.\u201d<\/p>\n
In contrast to the dot-com bubble,\u00a0 Sonders said the current AI rally has much stronger fundamental factors correlated to momentum such as strong free cash flow, high return on equity and profitability streams.<\/p>\n
By comparison, the most highly correlated fundamental factor with momentum in the dot-com boom was negative earnings, she said.<\/p>\n
And thus, the S&P500 on Friday clocked its best weekly advance in over a month, primarily on the back of surprisingly soft inflation data.<\/p>\n
The headline consumer price index for May came in flat in what was its first unchanged reading since July 2022.<\/p>\n
The consumer inflation data ended up overshadowing last week\u2019s point of focus \u2013 the latest monetary policy decision out of the US Federal Reserve alongside the release of its luminous Summary of Economic Projections \u2013 the so-called dot plot.<\/p>\n
The Fed held interest rates steady at a 23-year-high, but also trimmed expectation of rate reversals to just one 25 basis point from a prior forecast for three such cuts.<\/p>\n
\u00a0<\/p>\n
Meanwhile, Chris Weston at Pepperstone says the price action and the technical set-up in US equity indices will be front and centre this week.<\/p>\n
\u201cIf it hadn\u2019t been for the rise and rise of Nvidia, Microsoft and Apple, then the US500 and NAS100 would have attracted far greater rewards for those positioned short.<\/p>\n
According to Counterpoint Global, the so-called \u201cMagnificent Seven\u201d stocks \u2013\u00a0 Apple (AAPL), Microsoft (MSFT), Nvidia, Alphabet (GOOGL), Meta Platforms (META), Amazon (AMZN) and Tesla \u2013 currently account for circa 75% of the largesse generated in gains by the entire S&P 500 index.<\/p>\n
The same seven playas were behind more than 50% of the S&P500\u2019s total gains for calendar 2023.<\/p>\n
Minus Elon\u2019s TSLA, which is being driven more by Musky madness than any Elon-generated AI, those scary numbers would be even scarier<\/p>\n
\u201cMarket breadth in the S&P500 is clearly deteriorating, and the index is hanging in by a thread, and that is throwing up greater short opportunities in single stock names, but such is the influence these three behemoth names have on both indices.\u201d<\/p>\n
\u00a0<\/p>\n
\u201cI just want to start off by saying, hot damn, I love you guys! \u2026 We have the most awesome shareholder base. I mean it\u2019s just incredible.\u201d<\/p>\n
Yep. Musk got his money.<\/p>\n
Elon\u2019s contentious pay deal was valued at about US$56bn when Tesla\u2019s share price was peaking in late 2021, but has since ebbed by about a quarter.<\/p>\n
Still. There was much rejoicing when all this happened late last week (Friday Sydenham time).<\/p>\n
Here\u2019s the actual news from last week\u2019s annual love in.<\/p>\n
\u00a0<\/p>\n
Here\u2019s the full breakdown of Elon\u2019s presentation, including Q&A session, at the 2024 Tesla Shareholder Meeting earlier today.<\/p>\n
1:36 FSD improving exponentially \u2014 ELON DOCS (@elon_docs) June 14, 2024<\/a><\/p>\n\n Elon\u2019s adroit use of threat worked wonders in this case \u2013 he simply threatened he\u2019d jump ship from TSLA if shareholders didn\u2019t give him what was due.<\/p>\n The legendary Wedbush tech analyst Dan Ives wrote on Friday that the decision to feed Elon his big bucks breakfast has unshackled a weight from around the neck of the TSLA share price.<\/p>\n \u201c(The remuneration greenlight) removes a $20- $25 overhang on the stock in our opinion that has weighed on shares since the head scratching Delaware ruling set this Twilight Zone soap opera on earlier this year.\u201d<\/p>\n Dan says that now the drama is over, Tesla could add as much as $350 over the next 12-18 months \u2013 that\u2019d represent a circa +85% rise from the stock\u2019s current price.<\/p>\n \u00a0<\/p>\n Ahh. We thought more Musk meets AI.<\/p>\n Elon is threatening Apple and fans of said company\u2019s devices with a blanket ban from all of his companies\u00a0 after the tech giant\u2019s big \u201cApple Intelligence\u201d reveal which is basically the incorporation of OpenAI\u2019s Chat-GPT chatbot software with Siri.<\/p>\n \u00a0<\/p>\n Screenshot via Z. Sorry, X<\/p>\n \u00a0<\/p>\n When a user grants Siri permission, it can use ChatGPT to answer stuff that Siri can\u2019t.<\/p>\n Elon\u2019s complaining that using OpenAI\u2019s Chat-GPT at the OS level raises security concerns for users\u2019 data.<\/p>\n It\u2019s also the kind of first mover tie-up that Musk himself appreciates on a commercial level.<\/p>\n \u00a0<\/p>\n Via Google<\/p>\n \u00a0<\/p>\n Broadcom (AVGO) +23%.<\/p>\n Skyworks Solutions (SWKS) +15%<\/p>\n Qorvo (QRVO) +13%.<\/p>\n Adobe (ADBE) +13%.<\/p>\n Arista Networks (ANET) +11%. Paramount Global (PARA) -15%<\/p>\n Aptiv PLC (APTV) -14%<\/p>\n Warner Bros. Discovery (WBD) -12%<\/p>\n Albemarle (ALB) -10%<\/p>\n PayPal Holdings (PYPL) -10% \u00a0<\/p>\n Via Fox<\/p>\n \u00a0<\/p>\n MONDAY<\/strong> TUESDAY<\/strong> WEDNESDAY<\/strong> THURSDAY<\/strong> FRIDAY<\/strong> <\/span><\/p>\n The post TECH-HEAVY: Musk got his money, now TSLA will too; this AI craze is no dot-com crash<\/a> appeared first on Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"
\n4:04 How robotaxi will work
\n7:08 Autonomy could add $5 trillion value
\n8:37 Optimus could add $20 trillion\u2026 pic.twitter.com\/ngUJDuVL00<\/a><\/p>\nDumb A.I. News<\/h2>\n
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APPL vs NVDA vs TSLA (year-to-date)<\/h2>\n
Last week\u2019s Top S&P500 Gainers<\/h2>\n
\n\u00a0<\/p>\nLast week\u2019s S&P500 Laggards<\/h2>\n
\n\u00a0<\/p>\nUS Futures on Monday night in New York<\/h2>\n
The Economic Calendar<\/h2>\n
Monday June 17 \u2013 Friday June 21<\/strong><\/h2>\n
\nIndia, Indonesia, Malaysia, Philippines, Saudi Arabia,
\nSingapore, Turkey, UAE Market Holiday
\nChina (Mainland) Industrial Production, Retail Sales, Fixed
\nAsset Investment, Unemployment Rate (May)
\nUnited States NY Empire State Manufacturing Index (Jun)<\/p>\n
\nIndonesia, Turkey Market Holiday
\nAustralia RBA Interest Rate Decision
\nUnited States Retail Sales (May)
\nUnited States Industrial Production (May)
\nUnited States Business Inventories (Apr)<\/p>\n
\nUS, Turkey Market Holiday
\nJapan Balance of Trade (May)
\nJapan BoJ Meeting Minutes (Apr)
\nUnited Kingdom Inflation (May)
\nSouth Africa Inflation (May)
\nCanada BoC Summary of Deliberations (Jun)
\nBrazil BCB Interest Rate Decision<\/p>\n
\nChina (Mainland) Loan Prime Rate (Jun)
\nGermany PPI (May)
\nIndonesia BI Interest Rate Decision
\nSwitzerland SNB Interest Rate Decision
\nUnited Kingdom BoE Interest Rate Decision
\nUnited States Building Permits, Housing Starts (May)<\/p>\n
\nUS S&P Global Flash PMI, Manufacturing & Services
\nJapan Inflation (May)
\nUnited Kingdom Retail Sales (May)
\nCanada Retail Sales (Apr)
\nUnited States Existing Home Sales (May)
\nUnited States CB Leading Index (May)<\/p>\n