S&P 500: Breaking Records and Riding AI Hype

The Lowdown on Volatility

Now, listen. If you’ve been watching the S&P 500, you’ll know it’s been hitting record highs—four in a row, to be exact. Alphabet’s earnings are stirring up AI excitement. But let’s talk about the VIX for a second. Today’s action? It’s still dropping, albeit slowly. By closing, it was in the 15s. Looks like we’re trending down nicely, following that big spike we saw post-liberation day. A quieter stock market scene should hardly surprise.

The Boring Yet Steady Indices

All right, let’s face it. The stock market’s gotten a tad boring. But low volatility tends to dry up volume, especially through summer—except for those standout options expiration or rebalance dates. The S&P 500 reflects this sentiment. Nonetheless, Jared from Yahoo Finance seems to think that you’ve got to look under the hood for the action. How about bond market volatility? The ISP of A move index is telling a similar story, coming down nicely too.

Meme Stocks and a Whiff of Mania

Let’s shift gears—meme stocks. It’s been a roller-coaster ride. While not every day sees an upward shift, downside movement lasted a bit longer. Take a peek at our Meme Stock Heat Map. There’s fresh blood like Circle, and old favorites including Coinbase and Robin Hood. The meme stock craze is alive and kicking, highlighting pockets of froth in an otherwise calm market. Crypto fits this narrative as well.

Meme Stocks Heat Map Sample

The Narrow Breadth and What It Means

Let’s talk narrow breadth. Is it a concern? Jared thinks of it as a yellow flashing sign—not too alarming yet. His chat with Jeff Hirsch, editor-in-chief of the Stock Traders Almanac, shed light on this. Calling market tops is notoriously difficult. Bottoms, however, present more visible cues in real time, especially those April 8th lows. Hirsch and Jared delved into why bottoms are more predictable. Tops? Not so much.

A Dive into Toppy Challenges

Hirsch touched on the challenges of pinpointing tops. Sentiment indicators work wonders at bottoms, but bullish indicators can linger. For tops, their predictive powers aren’t quite as reliable. Hirsch combines diverse elements like fundamentals, technicals, monetary policy, and sentiment to gauge market turns. His insights are captured on the “Stocks and Translation” podcast—worth checking out if you crave market wisdom.

Wrapping It Up

Catch Jared’s full breakdown on Yahoo Finance, a resource you don’t want to miss. Until next time, keep your eyes peeled for that next meme stock frenzy or market twist. See more from Jared Blickre on Yahoo Finance.