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The Tsunami Rally: Record Highs and the Road to 50,000 · The SPY Trader

• 0:00
  Good morning and welcome back to Spy Trader .
• 0:03
  I am your host , Skippy McScrip , and I am so glad you are tuning in with me at 5 am on this Saturday , February 7th , 2026 .
• 0:12
  If you are drinking your first cup of coffee like I am , let me tell you , it has been a wild week on Wall Street .
• 0:19
  We just wrapped up a week that felt like a rollercoaster , but it ended with what many are calling a tsunami rally on Friday , February 6th .
• 0:28
  The Dow Jones Industrial Average surged by over 1,200 points , closing at a record high of 50,141 .
• 0:37
  The S&P 500 , which we track via the SPY ETF , climbed back up to 6,932.30 .
• 0:46
  While the week started with a lot of nerves and selling in the tech sector , that Friday bounceback was really something to behold .
• 0:54
  Earlier in the week , investors were getting a bit jittery about how much money big companies like Amazon and Alphabet are spending on AI .
• 1:03
  We are talking over 200 billion dollars in capital expenditures .
• 1:07
  That caused a selloff in the Nasdaq , but by Friday , Nvidia led the charge back up , jumping over 8 percent after fears about hardware demand were seen as overblown .
• 1:18
  Broadcom and AMD also rallied over 7 percent .
• 1:22
  We also saw some huge moves in other sectors .
• 1:25
  Eli Lilly had a fantastic quarter with 20 billion dollars in revenue , mostly thanks to their weightloss drug Zepbound .
• 1:33
  But the real news there was their new partnership with Nvidia to build an AI drug discovery lab .
• 1:39
  That is the kind of convergence between tech and biotech that investors are looking for right now .
• 1:45
  Now , why did the market suddenly decide to go up so much ?
• 1:49
  Part of it is the labor market showing signs of weakness .
• 1:53
  The ADP private payrolls report showed only 22,000 jobs added in January , which was way lower than expected .
• 2:01
  Usually , bad news for jobs is seen as good news for the stock market because it keeps the Federal Reserve on a path toward easing interest rates , potentially as early as March .
• 2:13
  Plus , we are currently dealing with a partial federal government shutdown that has delayed the official NonFarm Payrolls and inflation reports .
• 2:23
  This data vacuum contributed to some earlyweek uncertainty , but the nomination of Kevin Warsh as the next Fed Chair is being viewed as a stabilizing move for the economy .
• 2:34
  In this environment , investors rotated heavily into value and industrials .
• 2:40
  Caterpillar jumped 7.1 percent on Friday , and Goldman Sachs gained over 4 percent , reflecting optimism about a soft landing and infrastructure spending under the One Big Beautiful Bill Act .
• 2:53
  Looking at the technical side of things , the Nasdaq or QQQ found some support at the 22,000 level after a shortterm correction .
• 3:02
  Meanwhile , the 10year Treasury yield fell to 4.24 percent as the weak jobs data made longterm bonds look more attractive .
• 3:10
  So , what should we be doing with our money ?
• 3:13
  Here are a few thoughts .
• 3:14
  First , I like the Vanguard Total Stock Market ETF , ticker VTI .
• 3:21
  Since we are seeing a rotation away from pure growth into cyclicals and value stocks , VTI captures the broader recovery better than the techheavy QQQ .
• 3:31
  Second , take a look at the Health Care Select Sector SPDR , or XLV .
• 3:36
  With Eli Lilly showing massive growth and that new AI partnership , the healthcare sector offers a rare blend of defensive stability and hightech growth .
• 3:47
  Third , if you want to follow the bluechip momentum , individual stocks like Goldman Sachs or the XLF Financial ETF are strong picks as interest rates stabilize .
• 3:58
  For a hedge , consider the iShares 20plus Year Treasury Bond ETF , ticker TLT .
• 4:05
  As the Fed looks toward rate cuts due to cooling labor data , TLT offers potential for capital appreciation .
• 4:13
  Finally , for the tech enthusiasts , I would avoid broad software plays for now and stick with Nvidia on any price dips , as they remain the clear leader in AI hardware .
• 4:24
  That is all for this morning's update .
• 4:27
  I'm Skippy McScrip , and this has been Spy Trader .
• 4:30
  Stay safe out there and enjoy your weekend !