Monday Takeaways: S&P 500 Hits Fresh Records as Tech Powers “Most Hated Rally”

Shah Gilani|June 30, 2025

The “most hated rally” just delivered another punch to the skeptics…

The S&P 500 posted its first new record since February – and futures are pointing to even more gains ahead.

But here’s what has me excited: This tech-powered surge is being driven by exactly what I’ve been telling you to watch.

The numbers tell the story:

• S&P 500 breaks to fresh all-time highs off April 8 lows
• Nasdaq 100 continues explosive momentum above previous peaks
• QQQ outperforming as AI and chip stocks power higher
• Russell 2000 and Dow setting up for major catch-up plays

While analysts slash Q2 earnings estimates (making beats easier), one sector refuses to slow down: technology.

AI isn’t going “back burner” – it’s staying front and center for the next decade.

I’ll break down why this hated rally could run much longer, which laggard ETFs offer the best catch-up opportunities, and why being on the sidelines means you’ve already missed out.

Click on the image below to see why it’s time to put your chips on the table.

TRANSCRIPT

Hey, everybody. Shah Gilani here with your Monday Takeaways.

The first takeaway from last week: it’s another record day on Wall Street. This morning, the futures are showing greater strength, and we probably will end the day higher and, therefore, at another record high. Friday’s closing high was the first new high for the S&P 500 since the February highs.

The Nasdaq Composite and Nasdaq 100 have already made new highs for the year and continued on their very strong ways. So the rally really has been powered by tech. The idea that American exceptionalism is dead and the U.S. markets that were once leading global markets have lost their luster, and the tech sector that has led U.S. markets against all other global markets – well, not so fast, people, because tech has led the rally.

Whether it’s big tech, whether it’s AI-related tech, whether it’s cybersecurity tech, it’s about tech. It’s about chips, and that’s where we are. Here’s what the S&P looks like, people. It’s a very pretty picture off of the April 8 lows.

Just a remarkable recovery.

This was ugly, but this was an opportunity here. For anybody that bought this – and we bought it in my subscription services, we bought a lot of different stocks down here. We bought stocks on April 8 when things looked pretty hairy and certainly have been rewarded for that. We continue to buy on the way up because I have been saying stocks just look like they want to go up. Yes, they have been climbing every wall of worry.

The takeaway from all of that is that, indeed, stocks have been going up because they see a better future. Now earnings season is about to kick in in another week or two, and that’s going to be interesting because analysts have been furiously cutting their earnings estimates for Q2.

As they’ve been cutting earnings estimates – and that’s earnings growth estimates because they’re still expecting growth, about four and a half to five and a half percent – that’s down from March when they were looking at about 12% for the second quarter. They’re anticipating that impact. As the quarter has evolved, they have been cutting their estimates.

One of the reasons many of them have been citing is the potential for tariffs to impact margins and profitability. So hence, a cut in earnings. But that just makes it easier for companies to beat because the benchmark, the hurdle has been lowered, and therefore, it’s easier to beat. So stocks look pretty good.

This is just one heck of a move up here for the S&P. At all-time highs, working on new all-time highs. Now if you look at the QQQ – and a lot of you, I know, want to play the technology sector and you want an ETF that does it all – it’s the QQQ for you, and it is for me. It’s a pretty simple way to get involved in the Nasdaq 100, which is where you want to be. Yes, the Nasdaq Composite is great, but I prefer the Nasdaq 100. I prefer the QQQ.

Even over SPY in terms of QQQ Nasdaq 100 versus S&P 500. This is a spectacular rise, well above its highs, making new highs and will likely continue to make new highs because, again, technology at the forefront really looks good.

There are a couple of laggards here. The Russell – and I’m going to use some of the ETFs because most people like to know, “If I’m going to play the Russell 2000, if I’m going to play the Dow, what do I play?”

If you’re going to play the Russell, it looks pretty good here. I think if there’s going to be some catch-up in terms of small caps, in terms of the Russell 2000, then I think you want to be in the Russell 2000. It’s a good opportunity here if markets are going to go higher, if sideline money comes in, and there’s going to be a lot of chasing if this rally continues because it’s one of those hated rallies. I don’t know if it’s the most hated, but it’s one of the most hated rallies. Nobody trusted it. We’ve seen that movie play out in the past, and we know how it ends – with higher and higher and higher markets for sometimes years.

So it’s not a bad time to get in. Now the Dow, same thing. The Dow is a bit of a laggard here – not as bad as the Russell 2000 in terms of lagging, but hasn’t caught up yet, hasn’t made new highs. But it’s working on it. So we have a little bit of catch-up to do in terms of both the Dow and, more importantly, I think, the Russell 2000. So the IWM to me looks like a good spot to maybe take a stand and try to catch a little bit of uplift there in a catch-up kind of play.

Now it’s going to be a short week this week. The takeaway there is trading’s likely to be a little choppy, but we do have jobs numbers on Thursday. Is that going to move the needle? I don’t think so because so far, everything has been good.

Inflation trends have been good. The tariff expectations that were supposed to be built into inflation numbers haven’t shown up. Spending is pretty strong still. Consumer confidence – yes, it’s fallen, but it’s not bad. Everyone’s scared about consumer confidence falling this much because it generally leads to recession. Well, that remains to be seen because interest rates are coming down, not because the Fed is knocking them down, because the market is knocking them down.

Treasury issuance has been strong in terms of reception, and yields have been coming down because as bond traders look at how these auctions have been received – and they’ve been received very well – they’re being bought. Therefore, there’s no expectation that the Treasury market could back up dramatically, and we could see the 10-year back at 5%. That doesn’t look even remotely close right now because we’re knocking on 4.25% yield on the 10-year. It has come down dramatically. It’s been one heck of a month for bond traders. If you’ve been long bonds, you’ve had one heck of a month.

The takeaway there is bonds have been supportive. The VIX has come down dramatically. It’s supportive, sporting about a 17 handle right now. You’ve got a lot of positives out there, and that, again, creates a clearing for markets to go higher.

If you’re looking for something to do and you’re a little nervous about the market, maybe take a shot with the QQQ because it’s not wise to short a market that’s making new highs, especially when the things that are causing investors to buy – i.e., chasing, i.e., the story of AI, which goes front burner, back burner, front burner, back burner – it’s really, to me, always going to remain on the front burner for another decade or two. So it’s front burner.

Those stocks have been powering technology, and AI in particular and chips and everything associated with data centers, energy – all having to do with the expansion of AI in our world – is powering stock markets higher.

The takeaway from all that is: listen, if you’re on the sidelines, put some money to work. You can always put tight stops in there. But if you’re on the sidelines, you’re missing out. You’ve already missed out.

I’m not so sure that we can go higher and higher and higher, but my bet is that we can. Therefore, since I am a betting man, put your chips on the table and just use fairly tight stops if you’re not convinced.

If we go higher and higher and you’ve got chips on the table, then add more chips. As scary as it gets, the higher we go, you still have to add because we can continue to go higher. Because yes – and I know a few people out there hate when I say this – it’s all good until it isn’t.

Those are your takeaways. Be safe out there, and happy Independence Day to everybody. Happy Fourth of July. Cheers, y’all.