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Navigating the Valuation Reset: Inflation and Market Shifts · The SPY Trader

• 0:00
  Good morning and a very warm welcome to Spy Trader .
• 0:03
  It is 6 am on Saturday , April 11th , 2026 , here in the Pacific time zone .
• 0:11
  I am your host , Penny Pincher , and I am so glad you are joining me to wrap up what has been quite a whirlwind week in the markets .
• 0:18
  We are looking back at the trading days from April 6th through the 10th , and let's just say the market gave us a bit of a roller coaster ride .
• 0:27
  Our main benchmark , the SPDR S&P 500 ETF Trust , also known as SPY , wrapped up the week down about 1.4 percent .
• 0:37
  If you were watching the tech side , the Invesco QQQ Trust took a deeper hit , falling 2.1 percent .
• 0:44
  The big story was the inflation report we got on Friday .
• 0:48
  Headline inflation hit 3.3 percent , which was a bit higher than the 3.1 percent the experts were hoping for .
• 0:56
  This shows that the last mile of getting inflation back down to the Fed's target is proving to be pretty stubborn .
• 1:03
  When this news broke , we saw the iShares 20 plus Year Treasury Bond ETF , or TLT , spike in yield as investors realized interest rate cuts might not happen as soon as we would like .
• 1:16
  Looking at the sectors , Technology and Consumer Discretionary were the biggest laggards .
• 1:23
  With the 10year Treasury yield moving toward 4.5 percent , folks started rotating out of highgrowth software stocks .
• 1:30
  Apple faced some extra pressure because of cooling smartphone demand in emerging markets , even with all their progress in AI .
• 1:38
  On the brighter side , Energy and Defense were winners this week .
• 1:43
  Rising tensions in the Middle East pushed crude oil up , and defense stocks climbed while Congress discussed a new procurement bill .
• 1:51
  The Financial Select Sector SPDR Fund , or XLF , also stood its ground .
• 1:57
  Higher interest rates are actually helping big banks like JPMorgan Chase maintain their margins .
• 2:03
  Speaking of JPMorgan , they reported earnings on Friday .
• 2:07
  They beat revenue expectations , but CEO Jamie Dimon was a bit cautious about the global outlook , which kept the stock price fairly flat .
• 2:17
  We also saw NVIDIA take a 4 percent breather , not because the company is doing poorly , but because the market is shifting its focus from hardware like chips to the software that uses them .
• 2:28
  Meanwhile , Tesla hit a milestone with its Full SelfDriving version 14.5 , but high interest rates are making car loans tougher for families , so the stock struggled to find momentum .
• 2:40
  So , what is the game plan moving forward ?
• 2:43
  Right now , we are in a valuation reset .
• 2:47
  The optimism we saw earlier this year is meeting the reality of sticky inflation .
• 2:52
  However , the labor market is still strong , so we are not in a total tailspin .
• 2:57
  For recommendations , I suggest looking at some defensive plays .
• 3:01
  The SPDR Gold Shares , or GLD , hit a new high this week and acts as a great hedge against this hot inflation .
• 3:09
  I also like the Vanguard Real Estate ETF , specifically for residential REITs that benefit from the housing shortage .
• 3:18
  For your core holdings , consider the Vanguard Total Stock Market ETF to get broad exposure .
• 3:24
  A great stock example is Microsoft , which remains a safe haven growth play because of its diversified revenue in cloud and AI .
• 3:33
  If you are looking at bonds , keep it short .
• 3:36
  The Vanguard Total Bond Market ETF is a more balanced choice than TLT right now , offering a yield around 4.8 percent without as much price risk .
• 3:47
  Finally , if you have a fiveyear horizon , this dip in the Invesco QQQ Trust could be a buying opportunity .
• 3:53
  I would look at companies like Salesforce that are starting to monetize AI software .
• 3:58
  Keep an eye on the Retail Sales data coming out this Wednesday , April 15th .
• 4:03
  If consumers are still spending , Energy and Financials might keep leading the way over Tech .
• 4:09
  That is all for this morning's update on Spy Trader .
• 4:12
  I am Penny Pincher , wishing you a wonderful , relaxing weekend .