Santoli: One key tech ETF may signal whether this bull market can keep marching on — SkimNews
Get the Finance newsletter
Daily finance — markets, central banks, M&A, the prints that move money. Free.
- The S&P 500 has held its upward path, with last week's pullback approaching but never breaching the top of its May-July range, while Goldman Sachs, State Street, NAAIM and Bank of America data all show professional allocators "stocked up" for the fall.
- The Leuthold Group's Courage/Fear Ratio has climbed to roughly an 18-year high, tracking a Courage basket (small caps, emerging markets, commodities, cyclical S&P sectors) against a Fear basket (U.S. dollar, gold, low-vol stocks, 10-year Treasurys).
- AI capex intentions showed no signs of slowing through earnings season, with both "spenders" upping projections and "vendors" raising guidance, all the way through Dell and Broadcom last week.
- The 10-year Treasury yield marching toward 4.8% is best framed as a "normalization shock" reverting to pre-GFC levels, with Deutsche Bank's Jim Reid conceding it is "getting harder to get outright negative returns in government bonds over the medium-term."
- Nvidia has outpaced the broader semiconductor group by 35 percentage points since June 30 after lagging for the prior 11 months, while software has recovered 70% of the October-April "Saaspocalypse" sell-off.
- The iShares Nasdaq Top 30 Stocks ETF (QTOP) — encompassing the Mag7 plus most relevant semis and other big AI-using corporates — peaked in relative terms during the May-June runup to the SpaceX IPO, retrenched sharply with the momentum collapse, and remains almost 5% below that three-month-ago peak.
- The Fed's September meeting sits roughly 10 days away with market-implied hike-vs-hold odds uncomfortably close to 50-50, with this week's inflation data "miscast" as a swing factor in Santoli's view.
Why it matters: With QTOP — broader than the Mag7 cluster — still 5% off its peak despite professional investors being fully positioned, Santoli argues the ETF is doing the heavy lifting for the S&P 500's record run; failure to break out soon could expose the AI bull market as "leaking steam" just as a near 50-50 Fed decision looms.
Ask SkimNews
