Free Markets · Honest Money · No Apologies
Thursday Trader’s Brief 30-Second Read · Cash Open 9:30 ET · Jobs Report 8:30 AM · Closed Friday
Last Tape | Wed Jul 1 SMH $620.46: −5.4% as the semis leadership cracked |
The Rotation | MU −10.6% META +8.8%: Chips dumped; laggards & banks bid |
10Y Treasury | 4.48% 30Y 4.97%: Yields backed up across the curve |
Macro Hedges | WTI ~$67 Gold $4,075: Iran talks ended; Brent below prewar |
Thu Futures | NQ −0.4% YM +0.2%: AI selloff extends into jobs day |
The second half opened with a violent changing of the guard. Wednesday, the narrow semiconductor leadership that carried the whole first half finally cracked. Micron fell 10.6%, Marvell 8.7%, Taiwan Semi 7.0%, Vertiv 7.0%, AMD 6.9%, and the semis (SMH) dropped 5.4%. But the money did not leave the market. It rotated. Meta ripped 8.8%, Palantir 7.8%, the banks and the beaten-down laggards caught the bid, and the Dow touched a fresh intraday record of 52,742 before fading. This is the exact resolution we flagged Tuesday: the narrowing staircase did not broaden, and it did not crash. Leadership changed hands.
The momentum board flipped upside down. Off Wednesday’s close, the CCI(20) board reads two green, four yellow, five red, and the tell is which two are green. Communication Services and Consumer Discretionary, the two worst sectors on the year, are the only greens left. The generals that owned the first half, Technology and Industrials, both rolled to red, joining Energy, Staples and Utilities. The year’s laggards are now the momentum leaders. That is a rotation, not a rally.
Meta got paid for admitting it over-built. Meta disclosed it has “excess compute capacity,” the first hyperscaler to admit the AI build-out ran ahead of demand, and the stock rose 8.8% anyway, because the market read capex discipline as free cash flow. That same admission is the knife under the semis: if the buyers of chips are slowing, then the sellers of chips (MU, AMD, MRVL) are the trade that unwinds. Software (MSFT +3.0%, CRWD +1.3%) got the money the chips lost.
Oil broke again, and the war premium is gone for good. WTI opens near $67 and Brent near $70, now below its pre-war level, after U.S.–Iran talks in Doha concluded and President Trump said they were “going well.” Gold sits near $4,075 and firm, the dollar softened to 100.8 after Fed Chair Warsh’s Sintra remarks lit up the debasement trade, and copper holds near multi-year highs at $6.14.
Trader’s call into a jobs number the whole year hinges on. Futures are mixed: Nasdaq −0.4% as the AI selloff extends, Dow and Russell modestly green as the rotation runs. The June payrolls report lands at 8:30 AM today, pulled forward because the market is closed Friday for July 3. It is the referee for the July Fed. With core PCE at 3.4%, a hot number keeps a July hike on the table; a soft one lets the reds re-green. Keep 6–10% in T-bills, and let the 8:30 print, not the rotation, set the map.