TMTB EOD Wrap

QQQs +3% as investors were very happy to hear the 2 week ceasefire news. Crude fell 17%. Yields ended up roughly flat. as treasuries failed to rally today which some saw as a warning sign that inflationary concerns not going away. We’ll stop there on the war news as we want to focus on those HOT AI SUMMER rays.

Not only were the HOT AI SUMMER vibes out in full force today, but we had another Saaspocalypse (two sides of the same coin at this point) — I’ve lost count how many we’ve had this year. The bigger and better the model release (Mythos), the bigger the underperformance in software, and today’s was BIG.

Today’s 7%+ underperformance vs semis was not only the biggest this year — which says a lot — but also the biggest in the last 20 years (I didn’t go further back but I’m pretty sure it’s the biggest ever)

Didn’t see one semi stock red on my screen while software was mainly a sea of red outside just a few names. IGV is now down 24% on the year while Semis are up 11% overall (and that’s with NVDA lagging), a whopping 35% spread. Overall ,the semis vs software ratio is hitting new lows;

Individual names leading the way both lower (sw) and higher (sems)

TMT Mo pair up 10%, one of its biggest gains in years. The AI trade vibes even managed to infiltrate the hyperscalers today as well: META +6.5% (see below for more detail); GOOGL +3.9%; AMZN +3.5%. Felt like the good ol days (oh wait, NVDA still underperforming…one step at a time…)

Ok, let’s get to the good stuff…

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INTERNET

• META +6.5% as they finally got some good news on the model front, announcing their new closed model Muse Spark, which came earlier than expected (most were thinking May release). Overall it stacks up really well against Opus and competitors. Great thread on the release here and great run-through of the current META bull case by AnonCap here in TMTB Slack (h/t to Randy for calling the news out early):