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The Great Tech Pivot: SmallCaps and SpaceX Take Center Stage · The SPY Trader

• 0:00
  Hello and welcome back to Spy Trader !
• 0:03
  It is 2:30 pm on Wednesday , July 1st , 2026 , here on the West Coast .
• 0:09
  I am your host , Buck Green , and I am so happy to have you with us as we navigate these fascinating financial waters together .
• 0:16
  We are officially kicking off the second half of the year , and after a historic first half , the market is showing us some very interesting shifts .
• 0:24
  Today , the major indices are taking a bit of a breather .
• 0:28
  The S&P 500 , which many of you track through the SPY or VOO ETFs , closed at 7,485 , down just a fraction at 0.19 percent .
• 0:40
  It is still having a great year , up over 9.3 percent yeartodate .
• 0:44
  The Nasdaq , or the QQQ , took a slightly bigger dip , finishing down 0.66 percent at 26,040 .
• 0:53
  But let’s look at the star of the show : the Russell 2000 smallcap stocks .
• 0:59
  They are up a whopping 21.4 percent so far this year !
• 1:03
  This tells us that the market rally is finally spreading out beyond just the giant tech names .
• 1:08
  Speaking of the giants , we are seeing a major rotation .
• 1:12
  Investors are moving away from the Magnificent 7 tech leaders and looking for value in other sectors .
• 1:19
  Part of this is because of the massive SpaceX IPO we saw in June .
• 1:25
  At a 2.1 trillion dollar valuation , it was the largest in history and it has soaked up a lot of the cash that usually sits in stocks like Apple or Meta .
• 1:35
  We are also keeping a close eye on the Federal Reserve .
• 1:39
  Our new Chairman , Kevin Warsh , is taking a hawkish tone , meaning he is focused on keeping interest rates higher for longer to fight inflation .
• 1:49
  With May inflation hitting 4.2 percent due to that energy spike from the USIran conflict , Warsh hinted today at the ECB Forum that another rate hike could be coming in just four weeks .
• 2:02
  Currently , the benchmark rate is at 3.75 percent .
• 2:06
  On the company side , Microsoft and Nvidia are under a microscope .
• 2:12
  Microsoft actually lost 20 percent of its value in June as investors started demanding to see the actual profits from all that spending on AI infrastructure .
• 2:22
  Even though the Philadelphia Semiconductor Index surged 88 percent in the second quarter , we saw Micron Technology fall today as people started taking their profits off the table .
• 2:33
  But it is not all tech talk !
• 2:35
  Nike gave us some great news today , with their stock jumping about 5 percent .
• 2:41
  Even though their sales in China have been struggling , their North American wholesale business is growing fast , which is a great sign for the brand .
• 2:49
  We also saw some action in the grocery aisles , with Kroger’s 1.65 billion dollar acquisition of Giant Eagle showing that investors are hungry for solid , cashflowpositive businesses .
• 3:02
  So , what is the game plan for your portfolio ?
• 3:05
  First , consider rotating some of your highconcentration tech holdings .
• 3:10
  If you have been heavy on the QQQ , you might want to look at the Vanguard Total Stock Market ETF , or VTI .
• 3:18
  This gives you exposure to those winning smallcaps and balances out the tech risk .
• 3:22
  Second , look at the Financial Select Sector SPDR Fund , or XLF .
• 3:28
  Higher interest rates from the Warsh Fed are actually good for big banks like JPMorgan because they can earn more on their loans .
• 3:36
  Third , let's talk about safety .
• 3:39
  The peace deal between the US and Iran is still a bit shaky , and any more trouble could send oil prices soaring again .
• 3:46
  Allocating a little bit to SPDR Gold Shares , or GLD , is a smart way to hedge against that geopolitical risk .
• 3:54
  Finally , if you noticed today’s weaker manufacturing report , it suggests the economy might be cooling down .
• 4:01
  To stay stable , you might want to rebalance a bit into the Vanguard Total Bond Market ETF , known as BND .
• 4:10
  If things slow down , those fixedincome assets will provide a nice cushion for your portfolio .
• 4:15
  That is all for this update !
• 4:17
  I am Buck Green , and this has been Spy Trader .
• 4:21
  Stay smart , stay diversified , and I will see you in a few hours with more updates from the floor !