It's been a long time coming, but all niches of the market finished in the green on Friday. Two sectors closed in the red (Health Care (XLV) and Energy (XLE)), as re-rotation has begun from expensive “value” to real “value.”

AI Trade Rebounds

What’s Old is New

Most of the names on the top advancer list are associated with the artificial intelligence (AI) trade. The list is also a great reminder of companies' ability to survive and reinvent themselves. Corning Inc (GLW), Ciena Inc (CIEN), SanDisk (SNDK), eBay (EBAY), and Garmin (GRMN).

When to Breakout?

I cannot remember the last time the stock market traded sideways for this long. Usually, after such a long sideways move, there is a decent-sized pullback (5.0%) after such a long, unfruitful attempt to break out.

That would be technical. The fundamentals say to stay ‘long.’

Today’s Session

It’s a quiet morning. The financial media is enthralled with the SCOTUS decision on Trump’s global tariffs, as the White House is pushing to use an alternative, but I think the focus should be on the areas of weakness and potential contagion.

Software

Jefferies downgraded four software names this morning (Workday (WDAY), DocuSign (DOCU), Monday.com (MNDY), Infosys (INFY)).

Private Equity

Private Equity concerns, which have lingered for almost a year, are becoming more intense and with good reason.  So far, no good answers from the smartest folks in the room.

Mega Cap Spending

Nvidia (NVDA) reports this week and fetched another upgrade this morning.

On the tariff situation, the decision was not a surprise “bombshell” or even a rebuke of tariffs; it was just an interpretation of the Constitution. Lots of fresh guesses on effective rate, including 13.7% at Yale Labs and less than 10% at Goldman.

Even before the decision, Goldman penciled out how tariffs were fading as an inflationary event.

Comments

I still feel this is a political cause, fanned by media, fighting everything the Trump administration does, the swamp will not go quietly Tom Sanders on 2/23/2026 2:18:47 PM

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