Weekend Update, July 6th, 2026

July 6, 2026

Dow Record, Software Strength, Chip Stress

Key Takeaways Last Week

U.S. stocks rose in a holiday-shortened week, with markets closed Friday for Independence Day observance. The Dow gained  +2.0%, the S&P 500 rose +1.8%, and the Nasdaq gained +2.1%. Healthcare, software, transportation, and financials showed strength, while AI and semiconductor stocks sold off sharply.

  • The Dow hit a record high, closing just below 53,000.
  • Software, cybersecurity, healthcare, and transportation led while semi chips lagged.
  • Oil stayed below $70/bbl despite Strait of Hormuz concerns.
  • The June jobs report was weak, with payrolls up 57,000 and unemployment at 4.2%, easing rate-hike fears.
  • AI leadership remains under pressure, but strength in software helped keep the rally intact.

U.S. Stock Performance – Index and Sector Moves

Financial markets improved during the week 7/3/26, though trading ended Thursday, due to the holiday.

Markets: Year to Date

Source: Seeking Alpha

The S&P 500 closed at 7,483, and the Dow reached a new record. The Nasdaq lagged as chip and AI names including Micron, Nvidia, and Lam Research weakened.

Sector performance favored healthcare, software, transportation, financials, and select consumer names. Semiconductors and memory stocks were the weakest area.

US Equities.

Source: Seeking Alpha

Sector performance moved away from momentum and toward GARP.

US Equity Sectors.

Source: Seeking Alpha

S&P 500 Weekly Leaders and Laggards Ranked

Top Performers (WTD):

  • Axon Enterprise (AXON), +30.7% – Cloud software, and AI-enabled security platforms.
  • AppLovin (APP), +25.2% – AppLovin opening its Ads platform to all advertisers.
  • Palo Alto Networks (PANW), +21.8% – Cybersecurity leadership after analyst target increases.
  • Datadog (DDOG), +21.3% – Rallied after acquiring Adaptive ML and launching new AI/security capabilities.
  • Moderna (MRNA), +20.2% – Biotech rally on flu-shot optimism, and oncology and autoimmune programs.

Bottom Performers (WTD):

  • Sandisk (SNDK), -19.6% – Memory/storage selloff after a huge AI-driven run.
  • Teradyne (TER), -18.7% – Semiconductor-test equipment weakness as investors rotated.
  • Seagate Technology (STX), -17.5% – Declined with memory/storage stocks.
  • Western Digital (WDC), -16.2% – Fell with storage and NAND names as AI hardware momentum reversed.
  • Coherent (COHR), -15.1% – Broader optical/AI infrastructure unwind and semiconductor weakness.

Breadth & Participation

Breadth improved away from AI hardware. Healthcare, software, transportation, and financials carried the market while semiconductor leadership weakened. This was a constructive rotation, but also a warning that the most crowded AI winners remain vulnerable.

US Equity Factors.

Source: Seeking Alpha

International/Global

Global markets were mixed. South Korea rebounded sharply after a prior selloff, with the Kospi rising +5.8% on strength in Samsung and SK Hynix, while European markets were mixed.

Global Equities.

Source: Seeking Alpha

Volatility & Risk Sentiment

Risk sentiment weakened in AI and semiconductors but improved in defensive, value, and small-cap areas.

VIX: 17 and declining

MOVE: 65 and in downtrend

Bonds, Credit & Interest Rates

Treasury yields fell as the softer jobs report helped ease rate-hike concerns. Treasury yields: N/A. Credit conditions remained stable.

Bonds.

Source: Seeking Alpha

Economic Data, Monetary Policy & Earnings

June payrolls rose 57,000, below expectations, while unemployment was 4.2%. Average hourly earnings rose 0.3% month over month. Manufacturing data was mixed but not alarming. ISM manufacturing eased to 53.3 from 54.0, with new orders still expanding at 56.0 and prices still high at 73.0, though down sharply from May.

https://www.zerohedge.com/economics/us-adds-only-57k-jobs-half-expected-unemployment-rate-slides-plunge-workers-participation

Commodities, Currencies & Macro Assets

WTI crude: below $70/bbl
Brent crude: ~$71.76/bbl
Gold: $4150
Bitcoin: $61500

Commodities.

Source: Seeking Alpha

Positioning rotated from AI chips and memory into cybersecurity, software, healthcare, transportation, and financials. The AI trade is not over, but the market is rewarding cleaner earnings visibility and less crowded leadership.

What Matters This Week

  • Fed minutes and rate-policy expectations
  • CPI/PPI inflation data
  • Oil below $70 and whether the Hormuz risk premium stays low
  • Delta, Taiwan Semiconductor, and early earnings commentary
  • Whether software strength can offset chip weakness

Bottom Line

Markets rose despite continued AI-chip weakness. The Dow hit a record, software and healthcare strengthened, and the softer jobs report reduced some pressure from rates. The key message is rotation: investors are not abandoning risk, but they are becoming more selective about crowded AI and semiconductor winners.

Stock Talk

Market Timing: Are you that good?

Past performance is no guarantee of future results. Indexes are unmanaged and one cannot invest directly in an index. They do not reflect any fees, expenses or sales charges. The preceding discussion is for informational purposes only. Investing involves risk and no reference to any security listed above should be considered a buy or sell recommendation. Advisory services are provided through Oak Harvest Investment Services, LLC, a registered investment adviser.