From Quantum to Space Tech: Matthew Tuttle Highlights Emerging Sectors Beyond Traditional AI Plays

The AI trade continuing to drive markets to records.

Yesterday, the S&P 500 and Nasdaq 100, building on records as Micron crossed $1 trillion in market cap.

Now this abbreviated trading week investors are watching for the Fed's preferred inflation figures which are coming out tomorrow morning as well as a second look at Q1 GDP and key reports from retail giant Costco as well as semiconductor player Martech joining me live here at the New York Stock Exchange this morning is Matthew Tuttle, CEO & CIO of Tuttle Capital Management.

Matthew, great to have you here.

Thank you so much for joining me.

Thank you very much for having me.

Well, today we are looking at the major stock averages higher, and this does come after some record highs in the previous session.

But what do you make of the fundamental backdrop, especially as we continue to monitor the situation in the Middle East?

Yes, so you've got kind of a dichotomy there.

You've got oil now selling off, but you know, everyone, we I heard this before.

The war is over.

I'd be buying oil stocks on the dip, and then you've got what's going on with Micron, all the memory names, the photonic names.

I would own those.

Maybe it's a bubble, maybe it's not, but I think you've got to own those here and just watch your position sizing, you know, don't go crazy with it.

Don't chase them, but you've got to own kind of those AI bottleneck trades.

Yes, so can you expand on this AI bottleneck trade?

I understand there are a lot of moving parts, especially when it comes to the ecosystem.

So how are you looking at this right now?

So you want to continually be looking for what is stopping progress of where AI is eventually going to go, and then what companies are solving that.

So right now it's the memory, it's the photonics, and we're big believers.

Space is a data center trade.

So we look at that as a bottleneck trade, but That's all obvious now.

All that stuff is ripped, so what you want to do is you want to continue to peel that onion.

What's the next layer?

So for example, one area we're looking at is glass substrates because that makes the photonics work better, and you've just got to keep peeling it and peeling it and peeling it as the technology continues to evolve.

Yes, and there are a lot of moving parts when it comes to the memory part, the photonics, as well as space, and these are areas which are not easy to get into overnight, is it?

So whether we're talking about the manufacturing or the R&D, you can't just flip on a switch.

So what names are you paying attention to and what sectors in particular?

It's, it's really those three, but we're also looking for the picks and shovels, and we're looking for the names that people aren't really thinking about because, you know, the microns, the Heinks, that's obvious.

So like one of the names we really like is Schmidt, S H MD.

It's a glass substrate name and, you know, again, that's kind of the next level.

Of photonics, so we like that a lot.

We like Cleveland Cliffs.

Cleveland Cliffs is what we would call halo, heavy asset, low obsolescence, and you know that's a pick and shovel name.

They make the steel that goes into the towers that we have to build.

We like INFQ.

It's a quantum name.

This market isn't that hard.

Watch Trump.

Trump's telling you now buy the quantum names.

The government just invested in Quantum, so I like INFQ because that's a little bit below the radar screen.

Everyone knows IONQ and Reggeti.

IONQ maybe people haven't heard about as much.

So those are three names that I really like right now.

A lot of focus on the space sector, especially on the heels of the NASA announcement yesterday, but also ahead of a key IPO, in particular SpaceX this year.

So what names are you paying attention to within space?

Yes, so we actually just launched the Space EPF 2.5 months ago.

It's already doubled.

These names are going crazy.

But Rocket Lab, Lunar, Redwire, ASTS, what you want is you want the pure play space names.

They're going to benefit from data centers in space, which I mean it's not happening tomorrow, but during our lifetime it's going to happen, and they're also going to get a tailwind from the SpaceX IPO and they already have obviously.

And Matthew, before I let you go, I do want to get your take on what we're seeing when it comes to the major stock averages, in particular the S&P 500, because when we look at the leaders versus the laggards, the equal weight versus the index itself, it's so important to pay attention to the details.

And right now when we're looking at record levels for the major stock averages, it's easy to get a little bit of FOMO here.

I mean it's very easy to get FOMO here.

I wouldn't be looking at the averages.

I would be looking at the areas you want to be in.

So again, we talked about the bottlenecks, we talked about the Halo names.

These are the energy and the infrastructure.

I'd stay away from anything consumer related.

I think the average consumer is going to have some trouble here.

And finally, before I let you go, of course.

It's very interesting to see what's happening in the chip names as well as semiconductors, but also it's interesting to look at the PE as well as compression multiples here.

But when it comes to the names that you mentioned in particular in memory, photonics and space, what are you looking at when it comes to the underlying figures?

So right now we're not in a fundamental driven market.

We're in a FOMO.

Market, but we're also in a market where people are expecting a very bright future for all of this.

So I'm paying a lot more attention to the momentum.

I'm paying attention to the charts, where are things going?

I don't want to buy anything that's way extended.

I want to look for pullbacks, so I'm more paying attention to that right now than what PE ratio Micron's trading at.

Yes, and speaking of which, as you mentioned, we are getting price targets adjusted.

And when we take a look at even the S&P 500, we know that a lot of firms are adjusting their year-end price targets given where we are right now.

But you mentioned pullbacks.

So what are some levels that you're looking at across the asset classes?

So I'm looking at the individual names that I want to be in that maybe I don't currently own.

I don't own as much as I want to, and then I'm looking, you know, they'll give you.

5678, 15% pullbacks.

We have some days where momentum just gets crushed, and when it does, these names are going to pull back hard.

I'd be buying them when they do, and we've seen that.

We've had like two of those days in the past two weeks.

Those have been great buying opportunities.

I'd keep buying the dip until it doesn't work.

Well, Matthew, great talking to you.

Thank you so much for joining me here at the New York Stock Exchange and thank you so much for all of your insights.

Thank you.

Thank you.