Jul 28 Market Commentary
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Overnight markets are mixed to green, this is despite the fact KOSPI declined -10.8% and the Nikkei down -3.95% with Asia 3/6 red but EU all green (mildly) while SPY is up .95pts in pre-market action.
The AI trade took a heavy hit yesterday with MU down -11.7% since yesterday pre-market, AMD -12.26% and SNDK down -21.45% since pre-market trading on Monday. The key for us was AMD as it was holding strength the best amongst the AI tickers. The KOSPI has been since June, and remains our canary in the coalmine, is now down -35% from the Jun 26 highs. Thus, the AI trade continues to unwind, and with earnings this week, the Mag7 badly needs some real beats/upside to continue the bull trend.
As we’ve been saying for a while, leverage is present in every bubble, and there is great leverage across the AI space, both on the buy side and supply side.
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