US stocks are nearing or at record levels.
Earlier this week, the Nasdaq 100 hit new all-time highs, and putting on a July Fed rate cut is gaining some traction after two Fed officials suggested it's possible.
Chairman Powell stating economic data would support a cut and if not for worries that tariffs could push prices higher.
Meanwhile, several countries are rushing to strike deals with the US before new tariffs kick in.
Canada's top negotiator says US and Canadian officials.
We'll meet this week.
Joining me here at the New York Stock Exchange to weigh in on what's happening with markets is Jay Woods, chief global strategist at Freedom Capital Markets.
Good morning, Jay.
Thank you so much for joining us.
Good morning.
I love your fun fact about Wrigley's WWI.
I was the market maker in Wrigley's when I got my seat in '98 and early 2000.
So you just brought back some crazy memories.
You used to give us gum at Christmas time.
So what was your favorite gum from Wrigley's?
Oh, it was just, yeah, juicy fruit was great, just regular peppermint. it was a classic, yeah, and total blast from the past, but right now we're looking at markets higher and we're seeing all-time highs for some key names.
So first and foremost, I do want to start out by looking at micron because they did announce their earnings yesterday.
So what do you make of this thing here?
This one blows my mind.
I mean, this stock is up 100% from its April 9th low going into earnings.
It broke out.
I knew if they would beat.
It would take a lot to get it to go higher.
Well, they did beat and they beat well, and the guidance was solid.
The street likes it and it continues its much higher.
So right now that really just lends more to that bullish narrative that just continues to be seen, especially in the semiconductor space.
So Mike and I'd be surprised if we could get much higher than where we are now, but.
You know, nothing has surprised me right now when it comes to stocks continuing to go higher.
It's crazy.
Yeah.
And earlier this week, the Nasdaq 100 hit a new record high.
So let's start out by looking at Nvidia because that hit another record high and so did Microsoft, but we are still in that tug of war between those two names being the largest market cap.
So what do you make of what's happening with Nvidia?
Well, let them battle it out.
This is great for the market, the two biggest stocks in the world. will keep going higher and you get the largest market cap ranking.
To me it bodes extremely well for the market.
This market has been swimming in a sea of uncertainty for a long time, and now we can see the shoreline.
And when you have stocks like Microsoft, Nvidia now breaking out technically to all-time new highs, this is the leadership we want.
This is the leadership we've been waiting for.
The stocks continue to do well on the earnings front.
It was all that.
Tariff uncertainty, that deep Se story.
Remember the panic about deep seek that's long forgotten.
And now we can focus on what's next.
So when Nvidia breaks out, I think I told you on the show a couple of weeks ago, the bullish horns are going to come spewing out of my head, and I should be wearing them right now.
But yeah, this is very good as we head into the second half of the year.
Yeah, hard to believe, but that second half is right around the corner.
So another sector I do want to touch on are.
Banks here and JPMorgan hit a new record high.
We have to keep in mind that these stress tests are upcoming, but given what the expectations are and that dividends are oftentimes issued by some of the big banks afterwards, what's going on with JPMorgan?
Yeah, JPMorgan is back.
Goldman Sachs knocking on the door.
Morgan Stanley doing well.
All that uncertainty is starting to clear up, you know, when we hit that liberation day with the. cart out on the lawn that put the fear of God into everybody.
We saw the markets say, you know what, if this is what really is going to happen, here's your worst case scenario and we sold off and that got people's attention clearly and now we've backed up.
So there's this taco trade.
Trump always chickens out backing off of these tariffs.
Well, we have deadlines coming up.
July 9th is a deadline.
So only have one deal in place.
Remember 90s, 90 days.
That's with England, but It seems like the narrative is going to be we're going to push it down the road a little bit.
We're going to negotiate in good faith, and the market is telling us right now with new highs that that's exactly what's going to happen and now the Fed is easing, which is going to help the banks.
So to me the headwinds that we've been dealing with are now dying down and it could become a tailwind if we get through.
The tariff uncertainty.
The Fed maybe makes a cut in July.
I still don't think Powell's going to go there, but the course is growing louder and not just from the president, but from a couple of his Fed chairmen who are voting members there.
So it's very interesting because all the uncertainty, all the fear that inflation would spike up, jobs, you know, job losses would increase.
They did slightly but not really.
And you know, if we're going to go one day at a point at a time. is what he normally does.
It's time to cut rates, so we're going to see what happens, but the worst case scenarios have been built in.
And remember we were this Sunday night we were watching World War II was about to happen and we rallied.
So to me that was very head scratching because I've been doing this a long time.
I'm like, oh we'll have a dip, but it'll be a viable dip.
We need to get a dip to buy.
So that was frustrating.
But when you look at that new leader board like you said, Microsoft Nvidia, JPMorgan and Financials, then you look at the sector.
XLK already making new highs.
XLF about to break out to new highs.
These are the two sectors you want to lead in a bull market.
So I think it's safe to say we're back now.
How euphoric will it get?
TBD.
But I think we know the worst is over and we move forward from here and I think it bodes well for the second half of the year.
Yeah, and speaking of which, Jay, before I let you go, I do want to talk about the S&P 500 here because we are above 66.
100, believe it or not this morning and you mentioned all that uncertainty whether we're talking about politics, terrorists, geopolitics.
We went through a lot this quarter.
So as we head into the second half, what are you looking for in terms of levels?
All right, well 6144.
15, not that I'm gonna do these things exactly, but that would be the closing high if we can get above that.
I think that's coming.
I'm watching the Russell 2000, which is actually down 4.2% for the year, starting to come back.
This is the Seasonal time we have the Russell reconstitution on Friday, the rebalancing where people will look for beaten down names or fear of missing out those names like Nvidia and Microsoft now making new highs and people are on the sidelines.
We've got to get our money into these names.
So I think that will start us off well and as far as levels we've been consolidating, but every time we pull back it's a lower high or wait it's a higher low yeah.
Yeah, so it's a higher low and that is very constructive and it's just a matter of time before we break out and we get more participants.
I don't think this will be a rally where the tide lifts all the boats, but the right boats are set in sail, and I think a lot more are going to follow soon.
OK, Jay, always great talking to you.
Thank you so much for joining us on this Thursday.
