Not only did the S&P 500 (SPX) established a new all-time high on Friday, but it also marked the quickest recovery after a decline of at least 15%. Truly remarkable stuff. The characteristics of the rebound are also hard to believe while market breadth has been lackluster, at best.

On the NASDAQ Composite, there were far more decliners than advancers, and down volume swamped up.

Market Breadth	NYSE	NASDAQ
Advancers	1,338	1,876
Decliners	1,422	2,597
New Highs	119	211
New Lows	18	76
Up Volume	2.11 billion	2.73 billion
Down Volume	2.16 billion	4.15 billion

As for the S&P 500, only 22 names were at new highs going into Friday’s session. Some see this as a bad thing, but I think it’s a great thing – more names will join the chase.

Upward Bias

The market was in cruise control mode when President Trump announced that tariff negotiations with Canada were suspended. The post took the wind out of the sails of the market, mostly a convenient excuse for some to take some profits off the table. However, the market gathered itself with an hour left in trading, and both the S&P 500 and the NASDAQ Composite set new records.

It was an eclectic mix. it is clear investors are looking to bottom fish.

It’s a short holiday week, but it should be an exciting one.

If you plan to go to the beach, be sure to take your phone or tablet.

Today’s Session

From Briefing.com

Senate voted 51-49 to advance large reconciliation bill to a full Senate vote tonight; House expected to vote Wednesday. The bill includes extension of 2017 tax cuts, spending cuts (Medicaid and green energy spending), deregulation, energy reform, immigration reform, and a debt ceiling increase of $5 trillion.

The bill extends 2017 tax cuts for all income levels with an increased standard deduction. Tax cuts will be made permanent.

The bill eliminates taxes on tips and overtime.

The bill increases deductions for seniors on Social Security by $4000.

The bill makes permanent write-offs for business interest expenses and R&D.

The bill provides $170 billion for border security and deportations.

The bill phases out solar and wind tax credits beginning in 2026 and will be completely phased out by 2028. The bill will require solar or wind projects to be in service by the end of 2027 to qualify for tax credits. Nuclear power credits will last until 2036. Hydrogen tax credits will be phased out in 2028.

The bill starts Medicaid work requirements beginning in December of 2026. The Medicaid provider tax will drop to 3.5% by 2032.

The bill creates a $25 billion fund for rural hospitals.

The bill makes auto loan interest tax deductible.

The bill raises the debt ceiling by $5 trillion.

The bill raises the state and local tax deduction to $40,000 for people making $500K or less. SALT cap will go back to $10K after 5 years.

The bill makes changes to the IRS free tax filing program, pending review by a task force.

The bill includes tax on college endowments and private foundations.

The bill includes reforms for how pharmacy benefit managers do business with the government.

The bill creates a new savings account for children, and $1000 of funding will be provided.

The bill provides new tax credits for nuclear energy.

The bill will provide billions for the construction of the "Golden Dome" missile defense shield.

The bill raises the child tax credit to $2200 from $2000.

The bill provides additional money for air traffic control and some other defense programs.

The market is poised to open higher, adding more pressure on hedge funds - who have increased short positions, and long-only funds -who have just begun to add equities. 

Wall Street strategists also must make big decisions.  They need to let the train leave the station, and their targets behind, or move their trees higher.  They have been behind all year long. 

The Fed will chime in today as President Trump continues to go after Jay Powell.

Comments

The $4000 Tax Deduction on SS for Seniors is a Huge Disappointment from what was promised. Elon has a great point! P. Krueger on 6/30/2025 11:58:47 AM

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