U.S. Futures & World Markets

The market has been pricing a deal with Iran for weeks, and we finally got official confirmation over the weekend — an official announcement of a peace agreement. This may be the least surprising announcement we hear all year, but stocks are soaring higher premarket. Markets crave certainty, and this deal eliminates one of the biggest risk factors for investors.

There was a ton of hype around the SpaceX IPO, but Friday's debut turned out to be uneventful — and that is a very good thing. The sheer size of the deal and the eye-popping valuation were concerns, but the market digested SPCX in orderly fashion. The stock closed +19% on its first day of trading, which is inline with the average IPO. The bankers got their fees, investors who got allocations made money, and existing shareholders didn't get ripped off. That's about as close to a win-win-win as you'll ever find on Wall Street.

Now investors can get back to focusing on the usual suspects: earnings, interest rates, and whatever headline decides to move markets next.

S&P Futures vs. Fair Value: +95.00  |  10-Year Yield: 4.45%

CORE Headlines

Charts & Data

AI-token usage doubling even as per-token cost fell 90% — Jevons paradox in action. Torsten Slok, Apollo: "As tokens get cheaper, companies don't spend less but instead run more AI agents, automate more workflows and generate more code, pushing aggregate expenditure higher even as the unit cost of intelligence collapses." The AI spend supercycle isn't slowing down because it's getting cheaper — it's accelerating.

"We're not even close to silly yet. Get comfortable." JC Parets: a chart-based assessment of where we are in the AI rally — notably not at the kind of extreme that marks a top.

The US economy is being held up by AI capex and the top 10% of earners — a rug-pull could compound quickly. Dan Rose: "The resiliency of the US economy can largely be attributed to just two things — AI capex and the top 10% of income earners... which is especially circular this cycle." Worth watching as a structural vulnerability.

5 of the Magnificent 7 have underperformed the S&P 500 since start of 2025 — only Google and Nvidia have outperformed. Charlie Bilello: a very different picture than 2023-2024. The AI leadership has narrowed even within the mega-caps.

The three largest passive S&P 500 funds now hold over $2.6 trillion combined. Torsten Slok, Apollo: "Prices are increasingly set by mechanical flows rather than by anyone judging what companies are actually worth." The passive-indexing effect has never been more dominant.

S&P 500 equal-weight (RSP) hitting fresh all-time highs — breadth expanding. Market breadth expanding to include the equal-weight index is one of the healthiest things we've seen this year. The "only 10 stocks doing anything" narrative is starting to fade.

Russell 2000 hitting new highs — small caps joining the party. A second confirmation that the rally is broadening beyond mega-cap AI. Small-cap leadership alongside large-cap gains is a classically healthy setup.

Consumer sentiment rebounded sharply — biggest beat vs. estimates in months. Liz Ann Sonders via Daily Chartbook: "Consumer Sentiment rebounded to 48.9 vs. 46.0 est. and 44.8 in prior month." Still historically low, but the direction matters — and this inflects higher with the Iran deal.

US oil rig count climbing — up to 433 from 407 on Feb 27. Daily Chartbook: domestic production is responding to higher prices. More supply is disinflationary for oil longer-term.

Gold down 24% from its high — 70% 1-month win rate, but only 30% higher a year later. @sentimenttrader via Daily Chartbook: "Relief was not repair." A tradeable bounce is plausible; a sustained recovery is historically unusual after this level of drawdown.

Tech funds saw a record $12.3 billion in inflows over the past week. BofA via Daily Chartbook: money is flowing back into tech at a record pace. The rotation out of AI-adjacent names during the SpaceX IPO was apparently brief.

Nasdaq saw 1%+ daily moves for five straight days — tied for most since August 2024. Bloomberg via Daily Chartbook: the volatility spike of the last two weeks is giving way to a more directional move. Whether that direction holds is the key question.

Hyperscaler capex vs. cash flow — by year-end, all hyperscaler cash from operations will go toward capex, surpassing the dot-com TMT peak. Goldman Sachs via Daily Chartbook: a staggering data point on the scale of AI infrastructure investment underway. The picks-and-shovels trade has never been this dominant.

S&P has never had an up day on the first Fed meeting under a new chair — Warsh's debut is Wednesday. Bespoke via Daily Chartbook: a quirky but consistent historical pattern. Warsh's first meeting will be closely watched for any signals on the rate path.

Software at a discount to Nasdaq 100 and S&P 500 for the first time historically. Daily Chartbook: "The forward P/E of Software stocks has fallen below that of the Nasdaq 100 and S&P 500. Historically, software stocks have commanded a sizeable premium." Either AI disruption has fundamentally repriced software, or this is the buying opportunity of the cycle.

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This content does not constitute legal, tax, accounting, or other professional expert advice. Everything published is believed to be reliable, but its accuracy or completeness is not assured. Past performance does not indicate future results. The opinions expressed herein are subject to change without notice and are solely those of the author as of the date indicated.