*DON'T BE SURPRISED* if This Happens in The Stock Market

What a day for the stock market today. It is a mixed bag. Basically, wherever you look. In this video, I will share with you all of your major market moving news and events for the day today. And a lot of people have a lot of questions. It's a midterm election year. What do you do right now? Are we going to have a correction? We will talk about that in today's episode as well. Before we get rocking and rolling here, because I don't want to waste your time, the only thing that I ask you to do is hit the like button for the YouTube algorithm to help push this video out to more people that need to see it that'll make money from it. So, we did have some big news today. Trump signals a shift to economic pressure as Iran hardens its stance over the Strait of Hormuse. Trump said that he is prepared to wait for economic distress to mount in Iran, backing away from a renewed military offensive. So Trump's basically saying, "Look, we'll just let your economy collapse and your country fail internally. We don't have to use military force." Donald Trump shared this post on X. He says, "51 years of bad behavior. Iran has no money." This is showing you a chart from the past year or so where 1 million Iranian realale was worth about a dollar 11 USD and now it's worth 53 cents. So hyperinflation and currency devaluation. Now this comes after over this weekend it was rumored. We haven't heard anything officially confirmed, but Trump basically said to his internal team that if Iran opens the straight of her moose, tolls or not, he would be willing to walk away from the conflict. And I think a big reason for this, really the only reason for this is it is a midterm election year. So, it's really about damage mitigation right now heading into the midterms. Republicans are not going to do well during the midterms, especially if gas prices are over $4 a gallon going into them. So, I think really over the next two months or so, it is about limiting the damage, getting things back on the right path, and Republicans basically just hoping that voters forget about the gas prices and other problems that we've experienced over the past 6 months. Well, this leads us into the next piece of news today. Iran's foreign ministry spokesman says, quote, "Understanding with Oman is within reach if negotiations continue." So basically what's happening right now is Iran and Oman are in negotiations to open different waterways. So essentially the inbound traffic into the straight of Hermus is going to pass by Iran. the outbound traffic is going to pass by Oman. Well, at the same time, Trump's like, "Look, if you guys open the straight of moose, we'll end the war." Basically, is what's happening. We're kind of waiting for this agreement between Iran and Oman to be finalized and confirmed. And then we'll see if they open the straight of her moose and we leave the conflict. But the stock market is a bit skeptical today. Oil prices are up about 3 1.5% sitting at $80.88 per barrel. While also 10-year Treasury yields today are up about 3.5 basis points, sitting at about 4.692% sitting at some of the highest levels for 10-year treasuries you've seen in the past 5 years. So, I don't know what the timeline is going to look like on all of this, but you guys have to understand, at least from my perspective, it's about damage mitigation at this point heading into the midterms. Now, after the midterms, who knows what'll happen if the shredder moose is opened and the military forces in the region have died down. I don't think they're going to rush back to Iran to restart the conflict. But I don't expect much of an escalation here in the next two months. I mean, that's that's not good for Republican voter turnout at this point. It's too close to the midterms. And you also now have a scenario where investors are pricing in rate hikes by the end of this year because of higher oil, because of this war with Iran. And compound that on top of everything else going on and yeah, it's not a good look for the midterms. So, I don't know what day exactly the Strider Formoose is going to open or some of these positive developments are going to make their way into the marketplace, but I do think positive developments are coming. Whether or not they last a long time, that's up for debate. Now, if we take a look at the heat map today, you guys will see that semiconductors are actually selling off quite a bit today. Okay, Nvidia's down 2%, Intel's down three and a half, AMD is down, Texas Instruments, Broadcom, Micron, the whole suite of semiconductors basically in the red today. Computer hardware is doing a little bit better like a Dell AET, um, SanDisk, right? Uh, Western Digital semiconductor equipment not doing as great. So, even within the semiconductor AI hardware trade, it's not like a uniformally great day or bad day. There's a lot of mixed reactions out there in the marketplace, even within communication services, right? There's red, there's green cyclicals, there's a lot of red, there's a lot of green. Same for financials and industrials. But some of the big news today for AI stocks, specifically semiconductors, is this news here. It says Intel plans a $15 billion stock offering as AI demand accelerate. Intel highlighted physical AI, purpose-built silicon, and advanced packaging as major growth areas. And this is quite honestly a big reason why you want to stay away from AI hardware stocks and hyperscalers for that matter. Again, in my opinion, is because they're going to be spending so much money that simply the bond market just is not going to give them cheaply anymore. So what they're going to do, they're going to go out, they're going to sell stock. Yes, you are going to fund their capital expenditures. No investor wants to fund a company's capital expenditures. Okay, it's a big uh you know magnetic force to keep investors away. And I do think some AI hardware stocks could do well. I'm quite bullish on Marll, Qualcomm, AMD, but for the general group of these stocks, hyperscalers and AI hardware included, there's just not a lot of opportunity there at this point. the FOMO wave is over with. It's not coming back. You really have to rely on disciplined execution. What does that mean? That means disciplined execution. Not going out and diluting investors $20 billion, $50 billion, hundred billion to put up growth or fund future growth. Nobody wants to invest in a company that's diluting their investor base, no matter how exciting the story sounds. And over the next 12 months, there's going to be a lot of dilution in hyperscalers and maybe even some of your AI hardware stocks like Intel. You will notice today if you take a look at the heat map, software doing very well today. Cyber security on fire, but software also doing very well. Now Iran also said today the straight of her moose security depends on aggressors ending military actions against Iran and compensating for previous violations. Iran's Aragoti and Pakistan's DAR had a call today focusing on the evaluating situ evolving situation in the region and efforts to promote peace and stability. Apple is also down 2 and a.5% today as as Jeffre cut their rating to underperform from hold. And also in the news today, Microsoft will significantly raise their internal AI chip production. Also in the news today, hedge funds are piling back into stocks. Hedge funds bought global equities for a second straight week, reversing a sharp risk reduction in late July, according to Goldman Sachs. Gross trading activity rose at the fastest pace in 7 weeks with long buying outpacing short sales 1.4 to one. Single stocks saw net buying for the first time in a month, while materials led sector demand amid the strongest short covering wave in nearly two years. And also in the news this morning, the Bank of Japan's September rate hike signal led the US to join in the yen intervention. Kevin Hasset today, the White House senior adviser says Kevin Walsh is as independent as it comes. Hasset says, "If I were at the Fed now, I'd hold or cut rates." And wow, look at this. SpaceX retail investors have now turned net sellers. Retail investors sold a net 4.5 million of SpaceX shares on Friday, their first day of net selling since the company's June IPO. JP Morgan today raised their S&P 500 target to 8,000 from 7800, implying roughly 3% upside from Friday's close. Strategists cited strong earnings and growing evidence that massive AI investment is translating into customer demand. Stronger cloud growth and expanding backlogs at major tech companies are helping validate rising AI spending, which JP Morgan expects to represent more than half of the S&P 500's 1.5 trillion in capex next year. Now again, keep in mind we have big economic data this week. Not really anything this morning, but tomorrow you have the ADP employment change weekly and existing home sales. You do also have total household debt and a three-year bond auction tomorrow. But Wednesday, you get your core CPI number. You're expecting 0.2%. Last month was 0%. This is going to be a big driver to whether or not the markets start to think we get rate hikes or not, right? The jobs report last week came in really bad. If the CPI report comes in low, well, there's really no chance of getting rate hikes anytime soon. Current probabilities um are coming down a little bit. Uh yes, well, Friday the probability was 56.6% of a hold uh by September 16th. Today, it's down to 53.6%. So, it's dropping about 3% today, but you're still pricing in a hold for September. and the odds are rising slightly of a rate hike by October 28th. You are currently pricing in a rate hike with about a 62ish% probability. We also have important earnings throughout this week specifically for AI. This is a big week for AI companies. Uh today and after hours you have Rocket Lab, AS Space Mobile, HIMS and HERS. Um tomorrow in after hours you have super micro, coreweave, lum and cava. Wednesday you have nebius in premarket. In after hours you have cisco, inflection, coherent, uh sarah brass. And then uh Thursday you have JD.com and tapestry in the morning. In after hours you have applied applied materials, figure, pet meds and some others. The following week, you will start to get more cyber security, more software, and more cyclical like companies. But so far so good. 82% of S&P 500 companies have now reported earnings. 86% have beaten EPS estimates and 75% have beaten revenue estimates. This is this is a very good number. Now, let's talk about this seasonality before the midterms. Now, I know I've talked about this a lot on the channel, but we have to keep in mind the S&P is rec or the NASDAQ is recovering from an 11 12% decline. While I think anything can happen and we have to be prepared for that, I do think it is about damage mitigation right now heading into the midterm. So, I'm not expecting some kind of massive escalation with the conflict with Iran. If anything, I think we could actually get good news and the straight of moose actually opening up. That's good for the Fed. that lowers oil, that would lower 10-year treasuries, that would ignite the broadening trade. I think the biggest risk at this point is within the hyperscalers, the hardware, the AI hardware stocks because just one headline of China's doing this or that's happening here can you know ignite or you know crash the sector and those are the biggest waitings in the S&P and the index that could bring the index lower. I don't foresee any kind of big bad news that just crashes the entire market. Obviously, that's unpredictable, but I just don't see that at this stage. So, I continue to prefer looking out for the next 12 months investing in the areas of the markets that are going to be the next big AI themes. You can see in the trading community portfolio, it's now up 83 and a half% year to date, which is insane, I know, but it's not really that crazy when you're doing what we're doing, right? We're beating Wall Street to the puck. We're beating Wall Street to the opportunity, right? During the SAS apocalypse when a lot of these stocks were, you know, down 50% year to date for no reason, yeah, we were scooping those up hand over fist. You know, a lot of those stocks have doubled since the last four months, right? It wasn't rocket science. It was looking out, figuring out where Wall Street is wrong and where consensus is wrong and taking advantage of those opportunities. The opportunities eb and flow in the markets at any given moment or any given year. But looking ahead at this point, I think there is four distinct opportunities right now. Four themes right now. Number one is robotics. This is the hardest one to play. There's not many options. Tesla, you know, Tesla is, I think, the main one within robotics. Automation, this is like Zebra Technologies and Rockwell Automation and maybe like a UIP path, right? Um, and I'm I'm sure there are many others as well. You could even put Palent here in this category. You have AI software. Okay, just generally a lot of software is going to benefit immensely from AI. that's not priced in. And then number four is cyber security. You could group that into AI software if you want to. I think it's kind of its own category. Those are the four main themes that are where the opportunity is. This is where the next double, triple, 5x, 10x is going to come from within these four themes. Again, let me reiterate robotics, automation, AI, software, and cyber security. Those are the four main themes for the next 12 to 24 months within the AI trade itself. I like cyclicals, I like industrials, I like financials, but where you're going to make the most money is in those four areas. Now, if you guys want to come trade and invest alongside of us, that link is down below in the description of today's episode. But yeah, so from my perspective right now, what happens with Iran and the straight of Hermoose, that is top of mind for investors. That is what's going to move the needle for the broadening trade. Whether or not that continues, I think it's going to come down to what happens with the straight of moose. I am expecting something positive, if not nothing. Um, I don't think you're going to get some kind of massive escalation here right before the midterms. I think most people would probably agree with that logic. And then second up is the CPI report coming out on Wednesday. Also a major catalyst for the broadening trade. things like Nebius earnings, you know, other earnings for this week for AI like SMCI, those could move AI stocks, but I think I think it's really about the straight formoose and CPI for this week. Ladies and gentlemen, that is it for today's episode. I will tell you again, I am cautiously optimistic. I don't think we have to go through another massive decline in the markets. We just fell 11 12%. But, you know, whether or not we do well in the next couple of months depends on these broader issues. And I I can't accurately predict what's going to happen in with Trump's tweets or with the CPI report, although I think it's going to be low. Just uh just a speculation. So, let me know your thoughts on this down below in the comment section. Hit the like button as well as subscribe to the channel if you guys have not done so already. Have a fantastic rest of your day and I will see you in the next