Francis Hunt
Trading Education, Hunt Volatility Funnel & Capital Preservation
Tech stocks face a grim May 2026 as the market story rolls from Hormuz and oil to a financial and economic crash and deflation. Brent and US crude are selling off, with a run through $68 and further downside possible, contrary to calls for $250+ oil. Banks are also at risk as the stagflation narrative gives way to deflation. x.comÂ
Hyperscaler credit stress and weak financials-versus-staples leadership warn of downside risk in the S&P 500 consolidation. Spreads have broken July wides, though an upside breakout is probable if financials stabilize. So far, tech weakness has lowered yields as Fed hikes are priced out, letting defensives rally and the S&P chop. If the Fed signals Nasdaq weakness won't stop tightening without better data, the tech-yield link could break in an uncomfortable, 2018-like direction. x.com x.com … Show more
US tech stocks look vulnerable to escalation with Iran: @firstadopter reads the 'five days' timing in Trump's Truth Social post as a possible ruse to position troops for more pressure on Iran at the end of the week. x.comÂ
US tech stocks now look attractively valued after selling off into a very solid earnings season. Geopolitical risks keep growing, though, and sentiment has swung from risk-on in June to risk-off in July. x.comÂ
Forward risks matter more than good earnings for the Nasdaq now. The index looks to be topping and has a good shot at 28,000 before a rally after the midterms; tomorrow's PCE and GDP releases are unlikely to help, and this week's lows could break. x.com x.comÂ
Uncertain AI-capex profits and higher oil costs from Iran still threaten US stocks. The SPCX-Nvidia deal brought much-needed overnight inflows to chips and is shifting sentiment, but tech's waterfall decline will not heal with a sharp V-bottom. Be prepared for a big fade. x.comÂ
The Iran war, rising oil prices and inflationary pressure do not yet look severe enough to trigger a major economic crisis. Despite some deterioration in the macro picture and short-term volatility, the broader picture remains relatively healthy and the long-term outlook for US large-cap and Nasdaq 100 stocks is very positive. x.comÂ
Hotter-than-expected inflation is pressuring the Nasdaq as yields rise. September CPI reached 3.7%, above the 3.6% forecast; hot oil, rising rates and the active Iran war accompanied the Nasdaq's 2% drop. The Nasdaq also failed to hold 745. x.com x.com x.comÂ
Potential spending cuts and AI-related deflation make long-dated US Treasuries an asymmetric opportunity. A Democratic sweep could cut spending; an AI-trade blowup could cause deflation, while the AI trade hurts employment. Ending the Iran war could reduce spending and oil prices. Further crude gains could damage the economy hard and quickly enough to outweigh the inflation threat. x.com x.comÂ
US stocks could face a meaningful correction because the macro backdrop is deteriorating across bonds and inflation. The secular bull market is still expected to continue afterward, with a key factor potentially limiting the correction's severity. x.com x.comÂ
The Nasdaq 100's bottom for this move is not in yet, even if tech makes new highs later this year. The recent semis and tech crash blew up the Situational Awareness fund, and more forced unwinds by stressed funds are likely, as in 2022 when 3AC and Celsius were not the end. Martin Shkreli shares a report that two more AI hedge funds, AIPR and VARA, are down 30-50% this month. Prices still have a way to go before retesting the spring range for a bounce. x.com x.com x.comÂ
