Despite additional White House tariff actions, it was a nice start to the week. Super Micro Computer Inc (SMCI) surged on a brokerage upgrade. (I also learned that the South Korea National Pension Fund had been a buyer, belying the notion that it's only a retail investor phenomenon.)

Nine of eleven sectors finished higher, led by Energy (XLE) stocks.

The presence of Artificial Intelligence (Al) permeated the air and helped six sectors: Technology (XLK), Utilities (XLU), Materials (XLB), Industrials (XLI), Consumer Discretionary (XLY), and Communication Services (XLC).

Heat Map

The biggest squares and rectangles were various shades of green (save Tesla (TSLA)).

I was surprised by the weakness in Financials (XLF).

Momentum Darlings

The momentum darling is surging, and fresh Tech names appear daily on the top advancers list.

More than Retail Money

South Korea’s $720 billion National Pension Fund has been loading up on U.S. stocks, including Palantir Technologies (PLTR) and Super Micro Computer Inc (SMCI). Ironically, many Wall Street analysts have steered clear of these names because too many retail investors are buyers.

Subdued Inflation Concerns

Friday, the University of Michigan's one-year inflation expectations surged to 4.3% from 3.3%. Yesterday, the New York Fed saw one-year inflation at 3.0%, and the Street breathed a sigh of relief.

Today’s Session

With inflation data coming out over the next two days, the focus has shifted to inflation and rates. This morning, Cleveland Fed President Beth Hammock stated it is still not clear inflation will keep moving down to 2.0%, and added, risks right now are skewed to the upside.

Her comments dovetail with a Reuters survey where 75% of economists see a 75% chance of yields moving higher, not lower.

Hammack and economist that see higher yields point to Trump policies including tariffs and tax cuts.

Meanwhile, earnings are still coming in, mostly beating, with mixed guidance.

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