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Milestone Mania: Navigating S&P 7,000 and the Great Rotation · The SPY Trader

• 0:00
  Good morning and welcome to another episode of Spy Trader !
• 0:04
  I am your host , Sunny Sideup , bringing you the latest market buzz and trading insights .
• 0:10
  It is 5 am on Thursday , January 29th , 2026 , here on the Pacific coast .
• 0:17
  We have a lot of ground to cover this morning as we navigate a market that is currently gripped by what I like to call milestone mania .
• 0:25
  We have seen some historic moves over the last 24 hours , so pour yourself a fresh cup of coffee and let's dive into the numbers .
• 0:33
  The big headline this morning is that the S&P 500 recently crossed that massive 7,000 mark for the first time ever .
• 0:42
  As of right now , the index is hovering near those alltime highs at 6,992 , marking a solid 1.4 percent gain for January .
• 0:53
  However , while the big index looks strong , the real story is under the hood .
• 0:58
  We are seeing a major rotation in leadership .
• 1:01
  Investors are starting to pull capital away from those megacap tech giants that have led us for so long and are instead moving into smallcap companies and defensive sectors .
• 1:12
  Yesterday , the Federal Reserve kept the federal funds rate steady at 3.5 to 3.75 percent .
• 1:20
  Chair Jerome Powell upgraded his view of the economy to solid expansion , but he is hitting the pause button on rate cuts for now to see how the three cuts from late 2025 are settling in .
• 1:32
  Meanwhile , the safehaven trade is on fire .
• 1:36
  Gold spot prices shattered records this morning , surpassing 5,500 dollars per ounce .
• 1:44
  This flight to safety is being fueled by geopolitical tensions in places like Venezuela and talk of tariffs involving Greenland , not to mention a weakening U.S.
• 1:54
  dollar .
• 1:55
  In the world of individual stocks , the Magnificent Seven earnings cycle is creating some serious waves .
• 2:02
  Microsoft saw its shares drop about 6 percent in afterhours trading despite beating earnings , mostly because investors are worried about slowing growth in its Azure cloud business .
• 2:14
  On the flip side , Meta Platforms shares jumped nearly 9 percent thanks to a fantastic sales outlook and aggressive AI plans .
• 2:22
  Tesla also managed to climb about 3 percent after beating estimates , even though they reported their first annual revenue decline .
• 2:30
  Everyone is now looking toward Apple , which reports today after the market closes .
• 2:35
  With the stock down 6 percent this year , all eyes are on iPhone 17 demand .
• 2:41
  So , what does this mean for your portfolio ?
• 2:45
  My first big insight is to capture the rotation into smallcap value .
• 2:49
  Largecap tech valuations are looking a bit stretched , while small caps are seeing a fundamental comeback .
• 2:56
  I recommend increasing your exposure to the iShares Core S&P SmallCap ETF , ticker IJR .
• 3:03
  Unlike the broader Russell 2000 , IJR requires its companies to be profitable , making it a higherquality way to play this rally .
• 3:13
  These smaller companies benefit more from the Fed’s recent rate cuts because they often rely on floatingrate debt .
• 3:20
  Next , let’s look at defensive growth in the healthcare sector .
• 3:24
  With recession fears still lingering around 22 percent , healthcare offers a great mix of AI innovation and stability .
• 3:33
  I suggest looking at the Health Care Select Sector SPDR Fund , ticker XLV .
• 3:39
  Specifically , companies like GE Healthcare and IQVIA are leading the way in the Health Tech 2.0 wave and are currently trading at a discount compared to big tech .
• 3:48
  For those looking to hedge against inflation and political uncertainty , precious metals are a must .
• 3:54
  With a government funding deadline looming tomorrow , January 30th , the flight to quality is real .
• 4:00
  Consider adding SPDR Gold Shares , ticker GLD , or the iShares Gold Trust Micro , ticker IAUM , for a lowerfee option .
• 4:09
  Finally , it is time for some selective tech rebalancing .
• 4:13
  I am not saying you should abandon tech entirely , but it is wise to pivot from the companies that are just hoping for AI success to those that are actually proving it .
• 4:22
  I suggest trimming your position in Microsoft and moving that capital into Nvidia or Meta .
• 4:28
  Meta is specifically proving it can monetize AI through its advertising efficiency right now , whereas Microsoft's slowing cloud growth suggests that the infrastructure phase might be maturing .
• 4:41
  It is a highstakes environment out there , but by focusing on quality small caps , defensive healthcare , and gold hedges , you can stay ahead of the curve .
• 4:51
  This has been Sunny Sideup with your Spy Trader update .
• 4:54
  Stay sharp , stay informed , and I will talk to you in a few hours !