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Stocks Open Sharply Lower as a Tech-Led Selloff Ripples Across Global Markets

At the Open: A risk-off tone rippled across global markets on Tuesday with semiconductor and memory names facing the harshest downside pressure. Worries of frothy valuations and crowded positioning in the artificial intelligence (AI) trade sparked the bout of volatility, while jitters around elevated spending returned to the forefront amid the recent push from some firms to raise capital. News flow was fairly quiet otherwise, with Treasury yields finding some relief after Monday’s backup in yields while FedEx (FDX) prepares to present its latest quarterly results after the closing bell. The U.S. Dollar Index remained at year-to-date highs while gold and silver declined.



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Stocks Fluctuate Despite Falling Oil, Continued Geopolitical Deescalation

At the Open: U.S. stocks were set to return to action on a relatively quiet note with S&P 500 futures contracts little changed from Thursday’s close. Equities found little support on both the U.S. and Iran highlighting progress on deconfliction and the Strait of Hormuz over the holiday weekend, while crude continued to drop as traffic through the waterway picked up. Meanwhile, Nasdaq futures felt a little more support on fresh signs of insatiable artificial intelligence (AI) demand from booming South Korean chip shipments. Treasury yields rose across the curve, while investor attention turns to Thursday’s Personal Consumption Expenditures (PCE) release to gauge if rate hike expectations are warranted.



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Can Stocks Keep Climbing? Why Valuations May Drive the Next Market Rally
By Dr. Richard Baker, AIF®

My wife and I are taking our family to Slovakia later this summer to hike the Suchá Belá Gorge. This is a beautiful yet treacherous hike up multiple waterfalls by climbing ladders and walking on sticks of rebar protruding from the rock. That all sounded great last Fall while we were planning it, but now we realize we are not in good enough shape. For us to make that climb, something drastic in our workouts need to change. That pretty much sums up the next climb for the market as well; it needs a boost to go to the next level.

It’s already been a great year for stocks, with the S&P 500 total return of almost 10% year to date. The next leg higher may require more help from higher valuations than positive earnings surprises.

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Can Stocks Keep Climbing? Why Valuations May Drive the Next Market Rally My wife and I are taking our family to Slovakia later this summer to hike the Suchá Belá Gorge. This is a beautiful yet treacherous hike up multiple waterfalls by climbing ladders and walking on sticks of rebar protruding from the rock. That all sounded great last Fall while we were planning it, b

Stock Market Insights
By Dr. Richard Baker, AIF®

Can Stocks Keep Climbing? Why Valuations May Drive the Next Market Rally

My wife and I are taking our family to Slovakia later this summer to hike the Suchá Belá Gorge. This is a beautiful yet treacherous hike up multiple waterfalls by climbing ladders and walking on sticks of rebar protruding from the rock. That all sounded great last Fall while we were planning it, but now we realize we are not in good enough shape. For us to make that climb, something drastic in our workouts need to change. That pretty much sums up the next climb for the market as well; it needs a boost to go to the next level.

It’s already been a great year for stocks, with the S&P 500 total return of almost 10% year to date. The next leg higher may require more help from higher valuations than positive earnings surprises.

The market has posted strong gains this year despite a war and stubborn inflation, but so far those gains have been driven completely by strong earnings. The forward price-to-earnings ratio (P/E) for the S&P 500 has fallen since the start of the year, while most analysts agree that the earnings-per-share estimate for 2026 has increased by almost 9%.

It seems like investors are starting to push back a bit on AI investment. The hard-to-grasp AI spending has been around $725 billion this year alone, which includes the recent debt and equity raises by Alphabet, NVIDIA, Elon Musk’s SpaceX, and others. In other words, this year’s $200 billion upside surprise in AI capital expenditures probably won’t be repeated, or at least at the same pace.

If earnings outlooks remain stable, and I think they will, the P/E ratio will have to improve for stocks to enjoy another double-digit return over the next six months. For that to happen, stocks will have to start looking like better “deals.” Right now, stock prices are high enough that most new money is shying away from buying stocks (SpaceX was the exception) until they reach a better entry point.

This will only happen with lower oil prices, lower inflation, Federal Reserve rate cuts, and lower long-term interest rates. These may be difficult goals to hit, which may mean more modest second-half stock returns. Some say the Fed might actually raise interest rates, and there is also talk about the Trump Administration giving Americans a “Tariff Rebate” stimulus. Time will tell on all of it. One thing this market has proven this year is that you don’t want to sit on the sidelines because you never know what will happen. This bull market keeps taking licks and keeps on going.

The tricky part of the hike in Slovakia is that it is one-way only. Once you start, you can’t turn around, and if you are injured or tired, your group has to carry you up the trail to get back to your car. It might not be enough, but we have added a Stairmaster to our office gym and are trying hard to get ready for this hike. I wish I could say it was because we had a strong desire to get in shape, but the reality is, we don’t trust our kids to carry us! The market doesn’t have a StairMaster, but it needs something like that for valuations to go up as well.

Have a blessed week.

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This article was written by humans for humans because AI doesn’t have this quality of sarcasm.

Securities and advisory services offered through LPL Financial, a registered investment advisor, Member FINRA/SIPC. Opinions voiced above are for general information only & not intended as specific advice or recommendations for any person. All performance cited is historical & is no guarantee of future results. All indices are unmanaged and may not be invested directly.

All investing involves risk, including loss of principal. No strategy assures success or protects against loss. The economic forecast outlined in this material may not develop as predicted & there can be no guarantee that strategies promoted will be successful.

Fervent Wealth Management is a financial management and services entity in Springfield, Missouri.

Stocks Open Higher on Preliminary U.S.-Iran Deal

At the Open: The S&P 500 aimed to claw back part of its Fed day slide after President Trump inked a truce with Tehran. Sentiment received a lift ahead of the long weekend as tanker traffic began to trickle through the Strait of Hormuz shortly after the memorandum of understanding entered effect, and crude oil futures extended their weekly drop to well below $80 per barrel — reaching its lowest levels since the start of the conflict. Lower oil prices offset dented sentiment in equities from yesterday’s hawkish-toned monetary policy meeting, however, shorter-dated Treasury yields held Wednesday’s rise with the two-year yield trading near 4.18%.



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Stocks Poised to Open Mixed on Fed Day

At the Open: Equity futures steadied as market participants refrained from outsized bets on Wednesday morning. All eyes turn to Kevin Warsh and company’s first monetary policy decision as Chairman of the Federal Reserve (Fed) this afternoon, although attention will land on the subsequent press conference and any forward guidance (or a lack thereof), given central bankers are expected to keep rates on hold. A slight bounce in crude futures was also tabbed for the muted pre-market session. On the macro front, May retail sales cruised past consensus forecasts and prior results, showing some resilience in consumer spending despite inflation concerns. Treasury yields traded narrowly mixed.



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Stocks Open Little Changed as Focus Shifts to Central Bank Decisions

At the Open: U.S. futures fluctuated ahead of Tuesday’s open as news flow fell quiet after a strong start to the holiday-shortened week. Optimism around the expected U.S.-Iran deal held up well, although was somewhat countered by unanswered questions around implementation and how soon Strait of Hormuz traffic can normalize. Meanwhile, SpaceX (SPCX) continued to draw headlines amid outsized retail buying. On the macro front, May housing starts data missed forecasts, however, attention turns to tomorrow’s retail sales release and Kevin Warsh’s first meeting as Chairman of the Federal Reserve. Treasury yields were led lower by the long end of the curve, while oil paced its longest losing streak of the year.



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History's Biggest AI Spending Boom: Opportunity or Overhype?
By Joe Shearrer

This morning started differently than I expected. My daughter has been dealing with a virus for several days, and after a virtual visit with her doctor, we learned she may have chicken pox. As any parent knows, moments like that come with a lot of uncertainty. Are you sure it’s chickenpox? How severe will it be? How long will recovery take? Will anyone else in the house get sick? You don't have all the answers immediately, but you still have to make decisions and move forward.

Interestingly, I was already planning to write about the massive investment in artificial intelligence. While the topics couldn't seem more different, they share something in common: uncertainty.

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History’s Biggest AI Spending Boom: Opportunity or Overhype? This morning started differently than I expected. My daughter has been dealing with a virus for several days, and after a virtual visit with her doctor, we learned she may have chicken pox. As any parent knows, moments like that come with a lot of uncertainty. Are you sure it’s chickenpox? How sev