US - Market Strategy 04 (Jul 25 - Dec 27)

[winston]

It’s Time to Buy Small-Cap Stocks

by Bryan Hayes

Market breadth has improved, with a greater number of stocks participating in the bullish rally.

One area of the economy that benefits significantly from two key themes of President Trump’s approach – deregulation and lower taxes – is small businesses. There’s less red tape, allowing them to operate more seamlessly.

Small-cap companies, as measured by the Russell 2000, are set to deliver more than 60% year-over-year EPS growth in the second quarter.

We shouldn’t fear interest rate cuts, as small-cap stocks have performed admirably after the central bank begins the easing process.

And given that we’re in a strong, trending market with little volatility, the probability of further gains ahead remains enticing from a historical perspective.

Source: Zacks

https://dailytradealert.com/2025/07/28/ ... ap-stocks/

[behappyalways]

Why Kohl’s Stock Soared 100% For No Obvious Reason
https://m.youtube.com/watch?v=MyPxbqiPH4Q

[behappyalways]

Currently 150 stocks making new lows on Naz. That's the most since April.
https://x.com/Chartfest1/status/1951008253254697453

[winston]

Are US Stocks in a Bubble?

AI boom, meme-stock mania and record borrowing to buy stocks, are fueling talk of a market bubble.

by Tom Ozimek

Even when you can identify bubbles, it is tremendously difficult to know how long they will last.

”Valuations reminiscent of past near-term tops, margin leverage above normal and retail euphoria straight out of the 2021 Reddit playbook, only this time with a crypto and AI twist”.

”A balloon can hold some air without bursting. Similarly, assets reaching overvalued territory and then correcting does not necessarily indicate a bubble. It is part of usual market behavior.”

Bubbles often feed on seductive stories that “this time is different,” according to Shiller’s framework. The AI boom may be today’s defining narrative, with investors betting it will transform productivity and corporate profits.

Valuations for some AI names have decoupled from earnings reality, retail sentiment is running hot (especially around companies like Nvidia and AMD), and risk appetite is elevated among VCs and institutional players alike.”

AI has the potential to transform the economy but warns that investors face a risky backdrop of tight liquidity, lofty valuations, and fragile fundamentals.

Margin balances exceeded $1 trillion in June 2025, the highest on record.

Source: Epoch Times

https://www.theepochtimes.com/business/ ... %2BiFmE%3D

[behappyalways]

Yup, pretty much
https://x.com/Mayhem4Markets/status/1951355034048012606

[winston]

HIGHS AND LOWS

NEW HIGHS OF NOTE LAST WEEK

Bank of New York Mellon (BK)... financial services
CBOE Global Markets (CBOE)... exchange operator
ResMed (RMD)... medical equipment
British American Tobacco (BTI)... cigarettes and alternatives
Altria (MO)... cigarettes
Oshkosh (OSK)... industrial manufacturer
SPX Technologies (SPXC)... manufacturing
Idacorp (IDA)... utilities
American Electric Power (AEP)... utilities
Evergy (EVRG)... utilities
Fortis (FTS)... utilities
Xcel Energy (XEL)... utilities
Northrop Grumman (NOC)... "offense" contractor

NEW LOWS OF NOTE LAST WEEK

UnitedHealth (UNH)... health care giant
Colgate-Palmolive (CL)... personal care products
Chipotle Mexican Grill (CMG)... tacos and burritos
Copart (CPRT)... "junkyard giant"

Source: Daily Wealth

[behappyalways]

US tech stocks have reached a 100-year high relative to the S&P 500 in 2025, with the Mag 7 now accounting for 35% of total US market capitalization. - BofA
https://x.com/AyeshaTariq/status/1952298289627283696

[behappyalways]

Tech PE multiples just hit an all time high (source BBG)
https://x.com/zerohedge/status/1953133195920044514

[winston]

Nearly 50% of the S&P 500’s weight is packed into just 20 stocks

By: Jason Capul

Fresh data from Apollo shows that Nvidia (NVDA) now commands the largest individual stock weighting in the benchmark index since records began in 1981, underscoring the market’s intense focus on artificial intelligence (AI) leaders.

The chipmaker’s surge in valuation has propelled it past even the most dominant names of past decades in terms of index influence.

The trend is not limited to Nvidia.

The so-called “Magnificent Seven” — a group of tech and growth titans including Apple (AAPL), Microsoft (MSFT), Alphabet (GOOG)(GOOGL), Amazon (AMZN), Meta Platforms (META), Tesla (TSLA), and Nvidia (NVDA) — now account for 33.85% of the S&P 500’s total market weighting.

Broaden the lens to the 20 largest constituents, and nearly half of the index, or 48.44% more specifically represent the entire benchmark average.

Such levels of concentration raise questions about diversification and risk within the world’s most-watched equity benchmark.

Source: Seeking Alpha

https://seekingalpha.com/news/4482544-n ... e=hs_email

[behappyalways]

I wouldn't fade this move yet. But if people don't think we're well into an AI bubble, I would point out that the highs of the http://dot.com bubble, the PE of Cisco was just over 200. #Palantir #PLTR is over triple that! #bubble
https://x.com/JulianMI2/status/1953836245466911021



The Largest 10% of U.S. Stocks now account for 76% of U.S. Stock Market Capitalization, the highest concentration in history
https://x.com/Barchart/status/1953640336573538536