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The 2026 Pivot: From AI Potential to AI Proof · The SPY Trader

• 0:00
  Hello there and welcome to Spy Trader !
• 0:03
  I am your host , Sunny Sideup , and it is a pleasure to have you with us today .
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  It is currently 2:30 pm on Monday , July 6th , 2026 , here on the Pacific coast .
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  We have got a lot to unpack in today’s afternoon update as the market navigates this fascinating latecycle expansion phase .
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  We are seeing a major shift in how investors view the world , moving away from the wild speculation of the early 2020s into a period defined by tangible results and a normalizing Federal Reserve .
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  Let us jump right into the big news items shaping your portfolio today .
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  The S&P 500 , which many of you track through the SPY or VOO ETFs , is currently trading near alltime highs .
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  However , the momentum we saw earlier this year has started to tap the brakes .
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  The big story is the Federal Reserve .
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  Following the June meeting , the Fed signaled that inflation has finally stabilized at 2.4 percent .
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  While that is not quite their 2 percent target , it was enough for them to start a series of small rate cuts to protect the labor market .
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  This pivot is acting like a tailwind for broader market indices like the Vanguard Total Stock Market ETF , or VTI .
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  In the world of technology , the narrative has shifted from hardware to software .
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  Last week , NVIDIA announced that its Omniverse 2.0 enterprise adoption rates are blowing past expectations .
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  This is huge because it shows they are moving toward recurring software revenue rather than just onetime chip sales .
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  Meanwhile , in healthcare , we are witnessing a biotech renaissance .
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  Breakthroughs in CRISPR therapies and the commercialization of cheaper , more accessible weightloss drugs have given the sector a massive boost .
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  Taking a look at our analysis for the day , the theme for 2026 is definitely AI Proof versus AI Potential .
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  Investors are no longer handing out participation trophies for just mentioning artificial intelligence .
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  Today , the market demands to see actual margin expansion .
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  If a company cannot show how automated workflows are saving them money or making them more efficient , their stock price is feeling the squeeze .
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  This is why we are seeing Microsoft perform so well ; they have a dominant position in integrated enterprise software that companies are actually using .
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  We are also seeing a rebound in Real Estate and Financials .
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  As interest rates begin to decline , the cost of capital for Real Estate Investment Trusts has dropped .
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  The Vanguard Real Estate ETF , known as VNQ , has seen a five percent uptick over the last thirty days as those scary commercial refinancing fears start to fade away .
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  Even big banks like JPMorgan Chase are benefiting because the yield curve is steepening , which helps their profit margins .
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  Now , let’s talk about some concrete trading recommendations for this environment .
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  I am a big fan of the Core and Explore strategy right now .
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  For your core , which should be about 60 percent of your portfolio , I recommend sticking with the Vanguard S&P 500 ETF , or VOO .
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  In this normalized rate environment , broad market exposure is your best friend because it captures steady growth without the stress of singlestock volatility .
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  For the other 40 percent , your explore category , we want to target sectors with clear wind in their sails .
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  First , for AI productivity , look at the Technology Select Sector SPDR Fund , or XLK .
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  A great stock example here is Salesforce .
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  After a bit of a slow start in 2024 , their 2026 integration of autonomous agents has led to recordhigh margins .
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  Second , if you are looking for income and recovery , consider the Vanguard Real Estate ETF , or VNQ .
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  With the Fed cutting rates , the headwinds that crushed real estate a few years ago are vanishing .
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  A strong pick within that space is Prologis , as they benefit from the continued strength of ecommerce and logistics .
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  If you are worried about the economy cooling down too fast , the iShares 20 Year Treasury Bond ETF , or TLT , acts as a great insurance policy .
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  If a recession hits in late 2026 , those longterm bonds will likely surge .
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  Finally , do not forget about international markets .
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  As U.S.
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  interest rates fall , the dollar tends to weaken , which makes the Vanguard FTSE Developed Markets ETF , or VEA , very attractive for U.S.
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  investors .
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  Before I let you go , here is your checklist for the rest of the month .
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  Keep a close eye on inflation data .
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  If it stays below 2.5 percent , you can stay aggressive in the QQQ .
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  Watch the 10year Treasury yield ; if it drops below 3.5 percent , it might be time to increase your exposure to real estate and bonds .
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  And lastly , keep your eyes peeled for Apple’s quarterly report .
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  Their new SiriAI ecosystem is a makeorbreak moment for their valuation .
• 5:19
  Thank you for tuning in to Spy Trader .
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  Stay diversified , stay informed , and I will be back in a few hours with more updates .
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  Happy trading !