The news that President Trump had succeeded in bringing Iran to its knees was the headline that lit the fuse Monday, and by the end of the day it was green across the screen. That AI trade that remains so sensitive to the headlines? It is alive and well, too, writes Kenny Polcari, chief market strategist at SlateStone Wealth.
By the end of the day, this is what the scoreboard looked like: The Dow gained 486 points, or 0.9%; the S&P added 122 points, or 1.25%; the Nasdaq surged by 795 points, or 3.1%; the Russell added 22 points, or 0.7%; the Transports LOST 245 points, or 1% (think rotation); the Equal Weight S&P added 44 points, or 0.5%; while the Magnificent 7 rose 927 points, or 2.7%.
Of the 11 S&P sectors, technology stole the show, rising 3.8%. Consumer discretionary was a distant second at +1.7%, followed by industrials at +1.4%. Meanwhile, Energy got punched in the face, down 3.5% (think lower oil prices).
Within tech, individual names like IonQ, Inc. (IONQ) were up nearly 6% and D-Wave Quantum Inc. (QBTS) was up 12%. And the memory stocks? They continued to explode higher. Micron Technology, Inc. (MU) surged 10%. Western Digital Corp. (WDC) jumped 16%, while Seagate Technology Holdings Plc (STX) added 9.5%.
And the latest addition to the investing family? SpaceX (SPCX)? Yeah, it continued to push higher, gaining another 20% to end the day at $192 per share.
One thing that made no sense — at least at first glance — was the Transports. They fell 295 points. What? Lower fuel costs should be a gift for airlines, truckers, railroads, and shippers. In fact, airline stocks did move higher.
But the transport average fell because Monday’s session wasn't really about transportation. It was about rotation. Investors weren't selling transports because they suddenly became bearish on the economy. They were selling transports because they were buying something else. They were buying AI. They were buying semiconductors. They were buying growth. They were buying risk.
