Yesterday, Bloomberg Television and CNBC tried mightily and laid it on thick. But even when the market was only down fractionally, headlines painted a different picture.

The problem with this approach is that it nudges retail investors into the fray.

The media has lost so much credibility that people don’t believe it or, in the case of the stock market, are inclined to act the other way.

After being called “dumb” for so long, retail investors are simply following the basics:

• Buy low
• Sell high

By 12:30 p.m. yesterday, retail investors poured a record $4.1 billion into the stock market. They were 36% of the total volume to make up for smart money, which continues to suck their thumbs on the sidelines.

Go Big

Large-caps edged higher across the extended factors board.

Putting Your Money Where Your Mouth Is

Stephen Hemsley, the returning CEO of UnitedHealth (UNH), bought $25.0 million in the company’s stock, which attracted buyers to the stock and sector.

The session had a cautious vibe, as growth sectors struggled, with Technology (XLK) and Consumer Discretionary (XLY) finishing in the red.

I’m not sure what to say about Energy (XLE) anymore. Crude oil slows and Energy stocks cannot gain traction.

The Best Kind of Flip-Flop

On Sunday, Treasury Secretary Scott Bessent made a very uncharacteristic comment about another “Liberation Day.” 

The Street ignored it, but it was on everyone’s mind when the opening bell rang. Then, Bessent backtracked on the comment, further fueling the intraday reversal.

New Kind of Retail Investor

In the past, retail investor speculation was mainly seen as excessive trading. When you hear “Buy the Dip,” there is a similar notion.

But I’m not sure if retail is flipping stocks daily.

Many exchange-traded funds (ETFs) and options products exist for those who want to turn the stock market into a casino. A growing breed of retail investors is buying and holding for larger scores. 

They’ve made fortunes in recent years with Tesla (TSLA), Meta Platforms (META), and Palantir Technologies (PLTR). The smart money crowd has targeted these stocks, pulling them through the ringer. Those who held tough are sitting pretty.

March of the Wooden Soldiers

Four Fed speakers are out and about today.

I’m unsure what they will say, but the Leading Economic Index (LEI) indicators were slammed for the fifth month.

Can they continue to say risks are balanced and, because of that, the better part of valor is to punt?

Yesterday, Raphael Bostic of the Atlanta Fed suggested the Moody’s downgrade would mean one less rate cut this year. 

LEI

Today’s Session

Futures are indicating the market could open slightly lower, but notably still above major support levels.

Home Depot (HD) reported this morning, sending the stock up 2% in pre-market hours. The home improvement retailer saw a miss in earnings, but reaffirmed financial guidance for 2025.

Contrary to Walmart (WMT) who announce it would increase their prices due to tariffs, Home Depot (HD) has a different narrative. The CFO said on TV they are not planning to raise prices as more than 50% of their purchases are sourced in the United States.

Comments

"Thumbsuckers" ??? HAHAHA 😆 YUVONNA E BALDWIN on 5/20/2025 7:51:49 AM

After cutting 50bps right before the election, the Fed will thwart Trump's economic agenda for as long as possible. August Belmont on 5/20/2025 12:23:58 PM

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