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Peaked Out

PUBLISHED Jun 3, 2023, 7:51:44 AM        SHARE

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imgTom Hamilton

June 2, 2023 – Well we made it and in no small “Thanks” to the top 5 Tech stocks* (yes, the household names).* As I’ve noted before, the S&P 500 Index is capital weighted, thus 6 big cap stocks make up 25.9% of the entire index value. Heck, Apple along is 7.5% compared to Nike* (another household name*) making up only .37% and Delta Airlines .06%. I note that Delta employs far more people than Apple . . . not even in the same league, let alone ballpark. Lastly, Apple’s market cap is greater than the entire Russell 2000 small cap index. Just something to keep in mind when folks talk about the “stock market” as to what they are actually talking about. Right now, only about 6 or 7 stocks.

We’re just above the previous swing high of August, 2022. Now it gets interesting and this is a likely area to pause and consolidate. We remain in a ‘news driven’ market with the US economy strong, the debt issue behind us and the Ukraine War still a question mark. * (2 out of 3 +)* Job growth remains strong and that could spark the FED to increase interest rates to slow things down. The FED remains somewhat of a wild card.

Technology stocks are the place to be with AI* (artificial intelligence*) the new “me-me” stocks to pile into. Take a look at symbols PATH & AI for example of the Fear Of Missing Out over the past week. These go up until everyone is in, then retrace about half way back down. Are there new buyers there? That’s the unanswered question since these small companies don’t make any money, or at least, not much. The consumer remains fairly strong though showing signs of weakening demand as price remain high.

I’m invested, though tend to prefer the broad tech based index QQQ and ETF’s that hold a basket of stocks. I’d sure like to see broader participation in this market move, especially from Financials. Got to get some “Legs” under this market move. Perhaps later over the summer they will catch up if interest rates prove to stabilize.

Have a good week. ……….. Tom ………….. Chart by MetaStock, used with permission.

I/we have a position in an asset mentioned



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