00:00 Speaker A
Hey Allie, how are the markets looking? 30 minutes out from the start of trade off of some of these fresh records?
00:07 Allie
Yeah, as you were just saying, we are seeing a bit of a pullback here for stocks across the board after we saw those back-to-back record highs for both the S&P 500 and the Nasdaq. So, we have this exuberance in stocks right now, and we also have this broadening out of the rally to end the first six months of the year. We have industrials and communication services sectors leading the way higher, tech is number three. We've also seen a significant bounce back in financials as well. So, on a sector basis, the rally is broad. However, on a company-specific basis, we're still seeing those mega cap stocks outperforming some of those smaller and mid-cap companies. So, that's something that strategists tell me they'll want to see more of this broadening out, the more we get into the summer trading. Uh, and one thing that I've been interested in is just this disconnect that we seem to have between Wall Street sentiment and retail sentiment. Wall Street has been pretty bearish on the outlook, especially when we talk about the economic picture, but we've seen retail traders really lead this market higher, this aggressive buying of the dip. They have their hands all over this rally, and you can look at some of the best performing stocks of the year to paint that picture, Palantir, Super Micro Computer. I mean, these were meme stocks not that long ago, and now they're poster children for the AI tech trade. So, we're in this momentum-driven, FOMO chasing rally here, and that's really forced institutions to catch up as well. So, everything that we will see in the summer suggests that we could potentially go higher, but we could also see some volatility, some choppiness in the trade. However, we will be past peak uncertainty, hopefully, because we will be receiving some confirmation on the trade and tariff front, along with the tax bill, and that will just give markets, as well as the Fed, more clarity on what to do next. And Brooke, uh speaking of the retail traders out there, I know you're looking at different pockets of the market that have actually benefited and they've been a little riskier, right?
04:25 Brook
A little riskier indeed. When you take a look at what exactly Q2 consisted of, it really started at that peak when Trump announced that liberation day until now, and if you take a look here, investors really leaned into what quote unquote Goldman Sachs said was the riskier corners of the market over the past three months, as we kick off Q3 today. Taking a closer look since then, since that beginning of April, one of the riskier index that investors really have flocked to is that Bitcoin sensitive index at Goldman Sachs. And if you take a look, that has become a top performing asset over the past three months. If you take a closer look at Bitcoin, it's up more than 14% year to date. If you take a look at specific stocks, think of Coinbase, one of the companies that has been more of a riskier companies. They did close at a record high for the first time since November 2021 last week. Also, year to date, they're up more than 40%. Now backing down a bit off those highs as we roll into this lighter trading week, with trading set to close on Thursday at 1:00 p.m. Also, keeping a close eye on strategy, formerly known as Microstrategy, that bought another, that company bought another $532 million of Bitcoin. That's also up around 40% year to date. Another outperforming index under that Goldman Sachs note there was the high beta momentum index, think equities, think fixed income, think commodities over the past few months. But me, I'm always keeping an eye on that retail favorites index. If you could see there, that pink line there trending higher than the S&P 500, and what we've seen really lead that majority of retail stocks include things like Dollar Tree and Dollar General, two companies that have really been outperforming the S&P 500 as consumers really turn to low-cost goods, low-cost items in this environment where truly uncertainty is leading their spending decisions here.
