Oil prices surged and the stock market's "fear gauge" spiked as the war between the U.S. and Iran escalated again on Wednesday. Violence in the Middle East continues to impede traffic through the Strait of Hormuz, while even exponential growth for AI-related companies is letting down investors, traders and speculators.

"We'll be hitting them hard," President Donald Trump told Fox News after Iran struck a U.S. base in Jordan. "They're going to get a beating." The front-month West Texas Intermediate crude oil futures contract was up 7.2% at $84.94 per barrel.

The Cboe Volatility Index (VIX) rose from 18.21 on Tuesday to as high as 20.34 on Wednesday, breaching its "normal" range of 12 to 20 and settling at 20.05.

The July Fed meeting ended where investors, traders and speculators thought it would: with interest rates unchanged for the fifth straight time but central bankers worried about inflation and the energy shock.

The target range for the federal funds rate remains 3.50% to 3.75%. But three voting members of the Federal Open Market Committee (FOMC) dissented from the decision because they favored raising it by 25 basis points.

"Economic activity is expanding at a solid pace," reads a repeated sentence in a subtly updated but still brief FOMC policy statement, "despite elevated uncertainty that owes, in part, to the conflict in the Middle East."

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As Fed Chair Kevin Warsh said during his press conference, "We'll be watching inflation data over the period ahead," but he also said the central bank wouldn't rely exclusively on any one piece of it.

Acknowledging a steep rise in market-based rates over the last 42 days, the Fed chair noted shocks the economy seems to be absorbing relatively well so far.

By the closing bell, the tech-heavy Nasdaq Composite had shed 1.7% to 24,442, the broad-based S&P 500 was down 1.5% to 7,316, and the blue-chip Dow Jones Industrial Average had declined 2.2% to 51,594.

SKHY leads chip stocks lower again

The earnings calendar is the market's main focus following an overnight preview from South Korea-based SK Hynix (SKHY, -2.6%). The Nvidia (NVDA, -3.6%) supplier reported 257% top-line growth, as well as a 557% rise for operating profit and a 1,242% earnings increase.

But SK Hynix stock was down 9.6% on its local exchange because it failed to meet high expectations, and trading was halted on South Korea's KOSPI Index to stem a broader sell-off. The KOSPI closed lower by 6%.

Losses were similar for Nvidia and other semiconductor stocks such as Advanced Micro Devices (AMD, -5.5%), Broadcom (AVGO, -2.8%) and ASML (ASML, -2.0%), with Micron Technology (MU, -9.9%) suffering like fellow memory stock SKHY.

Up now are Meta Platforms (META, -1.3%) and Microsoft (MSFT, -0.7%), with Apple (AAPL, -0.6%) and Amazon (AMZN, -1.8%) to follow on Thursday.

CAT dogged by data center debate

Caterpillar (CAT, -6.9%) was the worst-performing Dow Jones stock on Wednesday after Baird analyst Mircea Dobre cut his rating on the heavy equipment maker from Buy to Hold and reduced his 12-month target price from $1,200 to $900.

Dobre cited rising regulatory opposition to AI data centers due to environmental strains and power grid pressures.

"The ground is shifting in many ways; the recent New York State moratorium on data center construction is the highest-profile example of a bigger (and growing) trend towards regulatory action at state and local level targeting data centers," the analyst observes. "This raises costs, adds new development approval hurdles, limits site availability, and likely slows future investment."

Caterpillar is scheduled to report second-quarter results before the opening bell next Tuesday, August 4. Wall Street expects to see earnings of $6.20 per share (+31.4% year over year) on revenue of $19.17 billion (+15.7% YoY).

CAT hit new all-time intraday and closing highs on June 30. The industrial stock is down 20.9% since then, shedding more than $100 billion in market cap.

What the 2-year Treasury yield says about a rate hike

According to LPL Financial Chief Technical Strategist Adam Turnquist, markets have adjusted to a "higher-for-longer" environment, with the 2-year Treasury yield up about 90 basis points from its February 27 low of 3.375% and outside the target range for the federal funds rate since April.

Turnquist describes eight periods since the 1980s during which the 2-year yield was above that range while policy was on hold, defined as at least three months without a change in the fed funds rate, along with a "crossover period" of at least 20 consecutive trading days.

"As of July 28, 2-year yields have remained above the fed funds target rate for 68 trading days," Turnquist notes, "with the spread reaching a maximum of 0.60% so far."

The median maximum spread for the comparison period was 0.97%. And Turnquist concedes the limited nature of the historical data set means it can't be used to either confirm or rule out a rate hike.

Still, he concludes, "The comparison suggests the current crossover is less mature than the three completed historical signals that ultimately preceded tighter monetary policy."

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Stocks were choppy early on Tuesday, but falling oil prices and a round of well-received corporate earnings helped the Dow Jones Industrial Average and S&P 500 climb higher into the close. The Nasdaq Composite, however, couldn't sidestep an extended slump in chip stocks.

At the close, the tech-heavy Nasdaq Composite was 0.2% lower at 24,876, pressured by weakness in semiconductor stocks. The iShares Semiconductor ETF (SOXX), which counts Advanced Micro Devices (AMD, -8.2%) and Micron Technology (MU, -8.9%) among its biggest holdings, fell 4.8% and is now down 23% for the month to date.

The continued sell-off is being "driven by concerns about capital return prospects, valuations, circular financing dynamics and Chinese competition," says José Torres, senior economist at Interactive Brokers.

But the broader S&P 500 (+0.2% at 7,428) and the Dow Jones Industrial Average (+1.0% to 52,747) advanced thanks in part to falling oil prices. Front-month West Texas Intermediate crude futures fell 4% to settle at $79.26 per barrel.

Strong earnings for several blue chip stocks also helped buoy the benchmarks. Coca-Cola (KO), for one, jumped 5.0% after the soft drink maker beat second-quarter estimates and raised its full-year guidance.

The company credited the FIFA World Cup as one catalyst behind its strong results, seeing Trademark Coca-Cola volume growth of 5% in Q2, its best volume growth since the COVID-19 pandemic.

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Boeing (BA) was another post-earnings winner, rising 4.8% as the aerospace giant's Q2 revenue came in higher than expected, which offset a wider-than-anticipated per-share loss.

Sherwin-Williams has its best day since 2022 after earnings

Sherwin-Williams (SHW) emerged as the best Dow Jones stock today, surging 8.3% — its best day since April 26, 2022 — after the paint maker reported stronger-than-anticipated second-quarter results.

"Sales improvement was driven by continued growth investments, new account wins and increased share of wallet," said Sherwin-Williams CEO Heidi Petz. "We also implemented pricing actions to offset raw material inflation that pressured our gross margin in the quarter."

In mid-June, Argus Research analyst Alexandra Yates said SHW is "uniquely positioned to benefit from significantly higher demand trends and margin expansion in the long term, this due to its dominant market position." Yates added that she views the materials stock as a "core long-term holding."

Corning suffers its biggest one-day drop in six years

Not all earnings reports were well received. Corning (GLW) plunged 12.1%, its biggest one-day drop since March 16, 2020, after the Gorilla Glass maker's disappointing third-quarter revenue forecast overshadowed a second-quarter beat.

Susquehanna analyst Mehdi Hosseini says the softer-than-expected revenue guidance is due primarily to "weakness outside Optical Communications, particularly within the Solar segment."

And he maintained a Positive (Buy) rating on the tech stock, saying it "remains well positioned to benefit from growing AI cluster sizes and increasing and width requirements, while also enabling alternative manufacturing approaches for fiber array units (FAUs), which we believe are among the most critical components in the commercialization of optical CPO (transceiver) architectures."

These transceiver architectures have a variety of use cases, including in data centers, AI chip connections and high-performance computing.

Buckle up

There are plenty more events this week that could spark market volatility. On the economic front, Wall Street is waiting for tomorrow afternoon's policy announcement from the Federal Reserve.

While it's unlikely the central bank will raise the federal funds rate this time around, rate hike odds have been rising. According to CME Group FedWatch, futures traders are now pricing in a 32% chance the Fed will increase rates tomorrow, up from 26% one week ago.

We're reporting live on the July Fed meeting. Follow along with Kiplinger for all the news and updates.

And on the earnings calendar, Wednesday's after-the-close announcements from Meta Platforms (META, -0.08%) and Microsoft (MSFT, +1.1%) will likely draw a crowd. Apple (AAPL, +0.9%) and Amazon (AMZN, -0.2%) will report on Thursday.

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Crude oil prices sank and interest rates were lower Monday on renewed hope for peace in the Middle East. But semiconductor stocks sold off as markets continue to wonder when escalating hyperscaler capex budgets will generate returns on investment.

The front-month West Texas Intermediate crude oil futures contract was down 8.1% to $82.04 per barrel. The 2-year Treasury yield declined by nine basis points to 4.322%.

Both are still much higher than they were before the war between the U.S. and Iran started on February 28. But the immediate reaction to the suspension of attacks in the U.S.-Iran war "implies further equity upside when the conflict is fully over," according to Louis Navellier of Navellier & Associates.

"The Fed decision on making a change in the fed funds rate will be the big event of the week," Navellier observes about the economic calendar.

The July Fed meeting starts tomorrow and ends Wednesday. Price action in the fed funds futures market shows a 64% probability the central bank keeps its primary benchmark where it is this week. But, according to CME FedWatch, odds of a rate hike in September are now up to 55.5%.

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It's also a big week for the earnings calendar, as Navellier notes: "By the end of the week, more than a third of S&P companies will have reported."

At the closing bell, the Dow Jones Industrial Average was up 0.5% to 52,209, and the broad-based S&P 500 had inched up 0.02% to 7,413 But the tech-heavy Nasdaq Composite was down 0.2% to 24,932.

AAPL > NVDA

Nvidia (NVDA, -5.0%) was the worst-performing Dow Jones stock during a rough session for chipmakers. The iShares Semiconductor ETF (SOXX, -2.1%) reflected broadening concern about the sustainability of the AI revolution as its leader makes new and bigger deals.

Bloomberg reported that Nvidia is discussing one deal worth as much as $250 billion to help its customer OpenAI lease computing power from a U.S. data center and another to finance $350 billion of OpenAI's chip purchases for the project.

On Friday, Nvidia announced a $500 billion deal with South Korea-based chipmaker SK Hynix (SKHY, -7.5%) that illustrates what skeptics describe as "circular" AI deals supporting the infrastructure build-out.

Apple (AAPL, +1.2%), meanwhile, overtook NVDA to become the biggest company in the world in terms of market cap. The iPhone maker will carry a year-to-date return of about 23% into its fiscal third-quarter earnings announcement after the closing bell on Thursday.

Meanwhile, amid rising anxiety about their capex plans, Meta Platforms (META, -0.2%) and Microsoft (MSFT, +1.9%) will report after the closing bell on Wednesday. Amazon (AMZN, -0.3%) joins AAPL in the spotlight on Thursday.

As Navellier writes, these four Magnificent 7 stocks account for 17% of the weight of the S&P 500 "and will be very telling of the continued confidence in the AI theme." Nvidia will report fiscal 2027 second-quarter earnings on Wednesday, August 26.

QBTS + T

D-Wave Quantum (QBTS, +8.9%) is one of the best ways to invest in quantum computing right now because it's making deals with classic blue-chip companies such as AT&T (T, +1.2%).

On Monday, D-Wave Quantum announced the expansion of a partnership teased in January when AT&T executives appeared at the Qubits 2026 conference. The telecommunications giant will now use D-Wave's tech across its network operations, most notably outage detection and traffic management.

"AT&T's initial focus is on layering D-Wave's annealing quantum computing technology into the tools that are already powering AT&T's agentic AI solutions," D-Wave said in its press release.

Mizuho Securities analyst Vijay Rakesh reiterated his Outperform (Buy) rating and raised his 12-month target price for QBTS from $29 to $35 following management's first "analyst day" event in June, citing its leadership in annealing QC.

Rakesh says D-Wave's updated financial model shows long-term gross margins for quantum computing as a service (QCaaS) at 65% to 75%, professional services at 40% to 50% and computing systems at 75% to 90%.

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Investors continue to hope for signs of progress as negotiations between the United States and Iran have broken down. The logic is straightforward: A peace agreement could reduce geopolitical risk, lower energy prices and reduce concerns about disruptions to the Strait of Hormuz. This should all be good news for the broader stock market.

Perhaps.

But I suspect many investors are focusing on the wrong takeaway.

The more interesting question is whether the conflict permanently changes how countries approach energy security.

Think about COVID-19 and the way it transformed global supply chains. For decades, companies optimized for efficiency. The pandemic then exposed the risks of depending on a single supplier or a single region.

"Just in time" became "just in case." A movement toward diversifying suppliers, reshoring production and prioritizing resiliency soon followed.

I expect energy will follow a similar path.

If recent events encourage governments and energy companies to place a greater value on resiliency and dependability — even when it comes at a higher cost — I believe the setup for oilfield service stocks may be more attractive than many investors realize.

How has the oilfield service industry changed?

Oilfield service companies provide the technology, equipment, expertise and manpower needed to find, drill, complete and maintain oil and gas wells. Whether an energy company is developing a new offshore field, maximizing production from an existing reservoir or repairing aging infrastructure, oilfield service companies are often central to the process.

Historically, the industry developed a reputation as one of the market's ultimate boom-and-bust sectors. When oil prices surged, producers rushed to drill more wells. When prices collapsed, spending dried up almost overnight. Service companies were often caught in the middle.

That history is real. But the oilfield service industry today is very different from the one many investors remember.

The three dominant players are SLB, Halliburton and Baker Hughes.

• SLB (SLB) is widely regarded as the industry's technology leader and has the deepest international footprint
• Halliburton (HAL) is perhaps best known for its leadership in hydraulic fracturing and remains the most direct way to gain exposure to North American shale activity
• Baker Hughes (BKR) has differentiated itself through growing exposure to liquefied natural gas, power generation and other energy technology

While each company has different strengths, all three stand to benefit from a world that increasingly values dependable energy supply.

This opportunity comes at a time when energy producers themselves have changed quite a bit. A decade ago, many exploration and production companies prioritized production growth above all else.

Today, shareholders are demanding capital discipline, free cash flow and returns. That shift may not generate the explosive growth that once characterized energy upcycles, but it could also result in a less extreme boom-and-bust cycle for service providers than investors experienced in the past.

Why should investors be optimistic about the sector?

The first reason I am optimistic about the oilfield service industry's long-term prospects is straightforward: The world still needs enormous amounts of oil and natural gas.

That may sound obvious, but investors continue to underestimate how difficult it is to replace existing energy infrastructure. Even as renewable energy grows, economies remain heavily dependent on fossil fuels and the countless products derived from them. The Iran conflict served as a reminder of that reality.

The second reason is that energy security is becoming more important.

For years, many countries focused primarily on securing the cheapest energy available. Going forward, some may place greater emphasis on securing energy from dependable partners and politically stable regions.

That shift could encourage development in areas that previously looked less attractive economically but offer strategic advantages.

More development means more drilling. More drilling means more demand for oilfield services.

The third reason is international growth.

Many investors instinctively think about U.S. shale when they hear the word "oil." Yet some of the most attractive opportunities for service companies may be found overseas.

International and offshore projects are often larger, more technically demanding and more service-intensive than their North American counterparts. They also tend to be driven by long-term development plans rather than short-term commodity price movements.

That plays directly into the strengths of the industry's largest participants.

Where are the opportunities?

Venezuela offers an interesting example.

Recent agreements involving Shell (SHEL) and BP (BP) suggest international energy companies see potential in bringing portions of the country's vast energy resources back into production.

After years of underinvestment and deteriorating infrastructure, doing so would require extensive technical expertise, well rehabilitation, equipment upgrades and project management — the exact types of services oilfield service companies provide.

Importantly, investors do not need Venezuela to become a success story for this thesis to work. Nor do they need oil prices to surge.

That is what makes the opportunity interesting.

The investment case does not depend on a single country, a single conflict or a single commodity forecast.

Oil and gas fields naturally decline over time. Existing infrastructure must be maintained. New projects must be developed. Production must be optimized.

The world needs energy today and will need enormous amounts of energy for years to come.

Some investors spend a tremendous amount of time trying to predict where oil prices will go next. I believe a more productive exercise is identifying the companies that help make energy production possible, regardless of where oil trades next month, and considering what recent events may mean for energy security over the next decade.

Oilfield service stocks are increasingly removed from the cyclical industry of the past that was tied to the next move in crude oil.

Here's the more durable reality: The world needs dependable energy, and oilfield service companies may play a critical role in making that possible.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Stocks rallied off their mid-morning lows on Friday on reports that Pakistan is attempting to restart peace talks between the U.S. and Iran. But worries about the impact of rising oil prices and new tariffs on inflation, as well as another round of poorly received tech earnings, had main indexes reversing course heading into the weekend.

At the close, the blue-chip Dow Jones Industrial Average was up 0.5% at 51,947 and the broader S&P 500 was 0.05% higher at 7,411. The tech-heavy Nasdaq Composite, on the other hand, was 0.6% lower at 24,975. The S&P 500 and Nasdaq notched back-to-back weekly losses, while the Dow extended its weekly losing streak to three.

Retreating oil prices somewhat eased inflation worries ahead of next week's Federal Reserve meeting. But while front-month West Texas Intermediate crude futures fell 3% to $89.31 per barrel, they're still up more than 28% for the month.

And the Trump administration's newly announced tariffs, which impose 10% to 25% tariffs on a variety of goods from major trading partners, kept price concerns at the forefront.

"The administration has found a replacement for the IEEPA tariffs struck down by the Supreme Court in February," says Sonu Varghese, chief macro strategist at Carson Group.

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While the effective tariff rate "will still be below the worst-case scenario feared after Liberation Day," he explains, the tariffs "add another layer of inflationary pressure, raising companies' costs for raw materials and intermediate goods that have yet to be fully passed on to consumers."

The Fed will conclude its July policy meeting next Wednesday afternoon. According to CME Group FedWatch, futures traders are pricing in a 64% chance the central bank will hold interest rates steady — down from 87% one week ago.

Intel swings lower after earnings, DLR has its best day since 2020

Market participants also sifted through a busy earnings calendar. Intel (INTC) was one of the most noteworthy reports. The chipmaker reported its highest year-over-year revenue growth in 15 years — up 25% from Q2 2025 to $16.1 billion — sending its shares higher at Friday's open.

But Intel closed down 7.9% on the day. "Even earnings reports that appear to be positive are often not enough in the current environment," write Argus Research analysts. And for INTC, in particular, Argus is concerned that key end markets, such as servers and PCs, "are at risk from soaring component costs, particularly for memory."

Digital Realty (DLR), meanwhile, surged 11% after its beat-and-raise quarter, its best day since March 13, 2020.

Results from the real estate investment trust (REIT), which owns, operates and invests in data centers, underscored "accelerating AI-driven demand, market share gains, and the strength of its global platform," says Stifel analyst Erik Rasmussen.

And given the company's strong execution, sufficient liquidity and increasing AI-related deployments, Rasmussen believes "Digital Realty remains well positioned to sustain double-digit earnings growth."

He has a Buy rating on the REIT and a $235 price target, representing implied upside of 17% to current levels.

Bank of America hikes its dividend by 14%

In non-earnings news, Bank of America (BAC) jumped 1.3% after the financial giant announced a 14% dividend hike.

"The increase in our dividend reflects the strength of our earnings, the power of our franchise and our confidence in Bank of America’s ability to drive long-term growth and create value for shareholders," said CEO Brian Moynihan in the press release.

This is welcome news for income investors who have watched Bank of America raise its payout for 13 years straight. And the most well-known person in that group is Warren Buffett, who first added BAC to the Berkshire Hathaway equity portfolio in 2017.

While Berkshire has been slowly reducing its exposure to the bank stock in recent quarters, it was still the third-largest equity holding at the end of Q1. And BAC has been an income-generating machine for Berkshire over the years, paying the holding company $625 million in cash dividends in 2025 alone.

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Saving for retirement is hard. For many, investing that money may be even harder. Target-date funds have become a nearly $5 trillion industry by largely solving that problem.

The "target date" is the year of an investor's expected retirement (but it could apply to any other long-term savings goal, such as college tuition). The funds have a heavier weighting in stocks early on, when the investor is younger and can better weather losses. They shift gradually over time to bonds, when safety becomes more important.

It's investing on autopilot, so much so that many call the premise of the funds "set it and forget it." That works for many holders of the funds. But target-date funds come with no guarantees. It's important to choose the right fund for you and to determine where it fits in your portfolio.

It can be an all-in-one diversified solution to a savings challenge, a core around which you layer other holdings or just one of many investments. As with any fund, it's also important to check in periodically to see how well it still fits.

Failing to do so may cause you to veer off course — a serious risk for retirement savers. "The negative thing with the target-date funds is that they don't know your life," says Mark Wilson, founder of MILE Wealth Management in Irvine, California.

Whatever the weaknesses, target-date funds' growth has been explosive: The market increased 20% in 2025 to $4.8 trillion, according to research firm Morningstar. Assets held by target-date funds, both inside and outside of workplace retirement plans, have grown 11.9% per year for a decade. A large part of that is performance, in addition to popularity.

With bonds in the mix, they won't keep up with stocks in a bull market, but most target-date fund holders saw double-digit returns in 2025, Morningstar reports.

A long-term trend toward sharply lower costs has added to the appeal. The average target-date fund had an expense ratio of 0.55% in 2015; in 2025, it was 0.27%. Competition has pushed fees for the cheapest offerings from fund companies including Vanguard and Fidelity to less than 0.10%.

And the funds, which largely contained actively managed investments at the industry's inception, have followed the larger trend of the fund industry by increasingly embracing index investing.

Encouraging good behavior

There are certainly benefits to a "set-it-and-forget-it" approach. Andrew Jacobs Van Merlen, a portfolio manager of the target-date strategies for fund company T. Rowe Price, says his firm conducted a study that suggests target-date investors are about 7.5 times less likely to trade in any given quarter.

"And that relationship holds in periods of market volatility, which is really critical," he says. Adds MILE's Wilson: "People who are in target-date funds tend not to panic. They're better behaviorally than other folks typically are."

The downside is that investors may lull themselves into thinking a retirement-oriented fund is safer than other funds. Many target-date funds tumbled in the financial crisis of 2007-09. More recently, investors who were shifting into heavier bond allocations just as interest rates started to climb in 2022 were in for a rude shock, because bond prices fall as interest rates rise.

William Connor, a wealth adviser at SAX Wealth Advisors, says one of his clients came to him, bewildered. "He asked, 'What happened? Wasn't I supposed to get more conservative?' "

A word about workplace plans

Although substantially similar to target-date offerings that anyone can buy, the funds you're likely to find in your workplace retirement plan may sport some key differences. For one, they're probably cheaper than conventional offerings. You'll likely have access to a less expensive institutional share class, for starters.

Or you may be offered funds legally structured as "collective investment trusts," or CITs, available only in workplace plans. Typically, a fund company takes the exact same asset mix that's in their conventional target-date mutual fund and places it in the CIT structure. Less administration, marketing and regulation — including lighter disclosure requirements — for CITs has added up to lower costs.

You may also see more innovation, at least at first, in workplace funds — for good or bad. On the plus side, some firms, as part of their target-date offering, are including an annuity or some other structure for guaranteed annual income post-retirement. BlackRock launched an annuity-based fund in its LifePath series in 2024, and Vanguard has announced a partnership with TIAA, the long-time pension and annuity provider.

On the jury-is-still-out side is the introduction of private assets into workplace target-date funds. Franklin Templeton, for one, introduced a line of Retirement Advantage Plus funds, with the "plus" indicating that the series provides "modest allocations to private real estate and private credit."

Private real estate has been part of some target-date allocations for years, but proposed rule changes at the Department of Labor could broaden the push into private assets, with the DoL estimating the changes could prompt 4.5 million plan participants to put $178 billion in target-date funds with alternative investments.

"I'm a big fan of private investments for sophisticated investors," says SAX's Connor. "I'm very wary about them going into these retirement plans."

Pay attention to the glide path

No matter whether you're choosing a retirement plan offering or considering a target-date fund for your personal portfolio, the so-called glide path will be one of your most important considerations. The glide path refers to a fund's progression from a heavy stock weighting to a majority allocation to bonds — and that can vary meaningfully from fund to fund.

Target-date funds are classified as "to" retirement — meaning they stop adjusting allocations on their target date — or "through" retirement, meaning managers tweak the mix for up to decades more after. (Most of the funds mentioned here are through retirement.) Some funds with a retirement date 40 or more years in the future are 99% stocks, while others are barely over 70%, according to Morningstar. The median allocation to stocks in funds with a target 40 years from 2025 is 93%.

Target-date funds today, in the aggregate, contain a higher allocation to stocks than their forebears did, in recognition that people are living longer in retirement and need the "growthier," inflation-beating returns of stocks to pay for it.

Even so, many advisers think the stock allocations are still not high enough. And some investors may decide they're able to tolerate a bit more risk than allowed by the fund that corresponds to the target date they have in mind. There's a workaround for that, Connor sometimes tells his clients: "You want to retire in 2045? Pick the 2055 fund. That'll keep you a little more aggressive for a little longer."

Investors adding a target-date fund to their own portfolio must also choose whether the underlying investments in their target-date fund are actively or passively managed. (A target-date fund can never be totally passive, because choosing how to allocate investments in each year of the path to retirement is an active choice by its managers.) The companies that sponsor target-date funds typically invest in a mix of their own mutual funds. Vanguard, not surprisingly, uses its index funds. Other target-date sponsors use active funds; some, including Fidelity, offer the choice of a blend of active and passive.

Today, 80% of target-date fund assets are held by five firms. Vanguard is at the top with 37% market share, followed in order by Fidelity, T. Rowe Price, BlackRock and Capital Group. To help you understand your workplace options or choose a fund on your own, we took a closer look at each of their offerings. Returns, expense ratios and other data are as of May 31 and apply to publicly available fund offerings, unless otherwise indicated.

Note that most target-date funds have several share classes, aimed at different types of investors, with varying expenses. The funds mentioned here either carry no sales charge or can be found load-waived at some, but not all, major online brokerage platforms, such as Fidelity, Schwab and E*Trade.

Vanguard Target Retirement

Vanguard's index-based approach drives one of the lowest expense ratios among target-date funds: 0.08% across publicly available mutual funds with target dates from 2020 to 2070.

The funds start with an allocation of about 90% in stocks and about 10% in investment-grade bonds, then start down the glide path about 25 years before the target date, around age 40 for someone retiring at age 65. At age 60, the split is 60% stocks and 40% bonds, and at 65, it's 50-50. Vanguard believes 72 is the most common age to start withdrawals, so the funds move to their final allocation, 30% stocks and 70% bonds, seven years after the target date.

Investors in Vanguard's CITs, but not in its mutual funds, have the choice to remain on the default glide path or freeze their stock allocation at 50% by converting to a balanced fund offered in workplace plans with a higher weighting in stocks.

For nearly the entire glide path, the underlying holdings of Vanguard's target-date funds include just four Vanguard index funds: Total Stock Market, Total Bond Market, Total International Stock and Total International Bond.

"With target-date funds, you're talking 40, potentially 50 years of investment if you hold this throughout your entire life cycle into retirement," says Brian Miller, the head of multi-asset product management for Vanguard. "It's hard for any manager, even a really good manager, to consistently outperform over that period of time."

Miller says Vanguard evaluates the allocations every year, considering population characteristics and capital market assumptions, and has not recently changed its asset allocations. "We continue to feel that those numbers make sense for our investors."

The funds have typically been middle-of-the-pack performers, although they meet or beat their benchmarks in most years. Vanguard Target Retirement 2030 (VTHRX), as well as the 2045 (VTIVX) and 2065 (VLXVX) iterations, rarely fell into either the top or bottom 25% of their categories in each of the past 10 years. The 2030 fund, however, finished in the top 15% of its category from 2023 to 2025. It has landed in the bottom half only once in 10 years. (Morningstar rates target-date funds only against their peers with the same target year.)

Workplace investors can expect to see CITs with an annuity option debut later this year. A portion (up to 25%) of investors' target-date fund holdings will fund the annuity in the years leading up to retirement; at retirement or later, investors can choose whether (and how much) of those savings to annuitize for guaranteed lifetime income.

Fidelity Freedom

The firm has three series: Freedom funds, which are actively managed; Freedom Index funds, which are passive; and Freedom Blend funds, which mix the two strategies.

For individual investors, the Freedom funds have expense ratios ranging from 0.46% to 0.68%; the Blend funds have expense ratios from 0.41% to 0.47%; and the Freedom Index funds have an expense ratio of 0.12%.

Last September, Fidelity said it would update its glide paths to boost stock allocations and reduce bond exposure for both early career investors and investors in retirement. The boost to the early career stock allocation is 5 percentage points; retirees will see stocks increase between 0.5 and 0.9 percentage point, depending on the target date.

The allocation shifts started in the fourth quarter of 2025, and Fidelity expects to complete the change by the end of the first quarter of 2027. That means that by then, Fidelity's 2070 funds will invest 95% of assets in stocks, while the 2030 funds will have a bit less than 60%. The firm's 2010 funds, whose holders would be at least 80 years old right now if they retired at age 65, will hold 30.5% of assets in stocks.

Fidelity also said it will increase exposure to inflation-sensitive assets for investors near and in retirement through an addition of commodities and an increase in U.S. Treasury inflation-protected securities. Fidelity says it's making the changes because investors are concerned about longevity and an increasing reliance on personal savings and workplace-plan assets instead of guaranteed pensions to support their retirement spending. The firm also says it sees the potential for continued inflation.

The Fidelity Freedom Index funds have been strong long-term performers, but they "have experienced some headwinds of late," says Morningstar analyst Hyunmin Kim, who notes that the funds had a smaller allocation to U.S. stocks than many peers and moved into bonds in 2021, just before a sharp increase in interest rates. (Bond prices fall when interest rate rise.)

That stock allocation, however, helped the funds beat most peers in 2025 as international stocks outperformed. Fidelity Freedom Index 2030 Investor (FXIFX) and Fidelity Freedom Index 2045 Investor (FIOFX) have finished in the top half of their peer group in seven out of the past 10 years.

Fidelity Freedom Index 2065 Investor (FFIJX), which has only a six-year history, has turned in a mixed performance over that time, finishing in the top 25% in 2025 and near the top third in 2022, but worse than 85% of peers in 2021.

T. Rowe Price Retirement, Target and Retirement Blend

T. Rowe Price has one of the heaviest allocations to stocks of any target-date fund provider. The firm has three sets of target-date mutual funds available to individual investors: Retirement, Target and Retirement Blend.

The Retirement series is 98% invested in stocks 45 years out from the retirement date and falls to just 55% at the retirement date. Stock exposure remains at 30% roughly three decades after retirement, when a fund holder who retired at age 65 would be about 95 years old. The Target series has a less-aggressive glide path that starts similarly but shifts more to bonds slightly sooner than the Retirement series and ends up at 42.5% in stocks in its target year.

The firm's philosophy is that a tilt toward stocks is a must for most savers. "If you're looking at savings behavior of most Americans versus what they're going to need, they're under-saving," says Jacobs Van Merlen. "That means that they need their assets to work a little bit harder to mitigate the risk of running out of money."

T. Rowe's Blend series, introduced in 2018, mixes the active management of the Retirement series with passive index investing. The Blend funds retain the same glide path, including stock allocations, as the Retirement series funds.

Fees across all three series of funds for individual investors range from 0.34% to 0.64%, with the Blend funds at the low end of the range.

The stock-heavy mix has helped the firm's funds outperform in many years of the bull market. T. Rowe Price Retirement 2030 (TRRCX) has four top-10 annual finishes in the past decade, and the fund ranked in the top 11% and 13% in two other years.

The shop's managers aren't infallible, however, with some "uncharacteristically weak" security selection and tactical calls recently leading to a mixed performance for the Retirement series, which otherwise has strong long-term returns, says Morningstar analyst Greg Carlson.

T. Rowe Price Retirement 2065 (TRSJX) has finished in the top half of its peers only twice in its five full calendar years of existence, and it has twice landed in the bottom 20%.

BlackRock LifePath

BlackRock's target-date strategy is called LifePath, and its path can be traced back to the beginnings of the industry, when Wells Fargo Investment Advisors launched its funds in 1993. (Barclays Global Investors acquired the Wells Fargo business in 1995, and BlackRock bought the Barclays operation in 2009. The LifePath name has been constant.)

There are two main series of funds: LifePath Index and the actively managed LifePath Dynamic. A smaller series, LifePath ESG, uses environmental, social and governance factors in its investing. A newer series called LifePath Paycheck, launched in 2024, includes an annuity-based income option that is only available in workplace-based retirement plans.

LifePath funds have heavy stock weightings early on but make a greater shift toward bonds during the glide path than most target-date products. At 45 years from the target date, the LifePath Index glide path is 99% stocks, 1% bonds. It drops to 95% stocks 25 years out and 65% stocks 10 years out. At retirement date, stocks make up just 40%.

LifePath Index funds have an expense ratio of 0.39%; the ESG Index funds charge 0.50%; and the Dynamic funds have annual expenses ranging from 0.84% to 1.59%. Availability of the funds with no load or fee varies depending on the brokerage platform.

Thanks in part to heavier bond holdings than its peers, BlackRock LifePath Index 2030 Investor A (LINAX) has finished in the bottom half of peers in eight of the past 10 years. BlackRock LifePath Index 2045 Investor A (LIHAX) has three finishes in the top third of peers over the past decade but may struggle to outpace peers as it adds to its bond mix.

BlackRock introduced target-date exchange-traded funds called iShares LifePath ETFs in November 2023. The funds, which invest in iShares stock and bond index funds such as the iShares Russell 1000 ETF, have target dates ranging from 2030 to 2070. The expense ratios range from 0.08% to 0.12% — comparable to the cheapest index mutual funds from Vanguard and Fidelity.

American Funds Target Date Retirement

The glide path for Capital Group's American Funds moves in two ways: The ratio of stocks to bonds grows more conservative over time, and the types of stocks also change. Early in the glide path, the funds' stock investments tilt toward growth-oriented stocks; as the target date approaches, the funds tilt more toward dividend-paying stocks.

The glide path keeps stocks near 90% of holdings until about 15 years to retirement. At retirement, stocks fall to just below 50%. The funds are designed "through retirement," so the final stock allocation, at about 30 years after retirement, is roughly 30%.

That post-retirement stock allocation is a slight downward adjustment of a few percentage points, says Kelly Campbell, who leads the multi-asset solutions business at Capital Group. "In our most recent assessment we decided to modestly adjust equity allocations for essentially the first time in a decade and a half because we believe it will make the glide path a bit more resilient."

Schwab, Fidelity and E*Trade all sell American Funds' F-1 shares with no load. The F-1s mirror the company's Class A shares, which have a 5.75% sales charge. The F-1 class of funds have expense ratios ranging from 0.63% to 0.75%.

The American Funds offerings have some of the better performance records among target-date funds: About 20% with a 10-year track record rank in the top 10% of their category, according to Morningstar. American Funds' 2030 Target Date Retirement (FAETX) has six finishes in the top 25% of peers in the past decade. American Funds' 2045 Target Date Retirement (FATTX) has five. The funds' move from growth stocks to dividend stocks as the target year gets nearer has hurt those funds' performance in years when more growth-oriented fare shines.

Strong long-term performance is important, but the best retirement investment is the one that fits your overall financial plan. Use the Bankrate tool below to connect with a financial adviser to build a retirement strategy tailored to your goals:

Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.

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Investors tend to view dividends as a general signal of corporate financial quality. The logic is sound: Companies typically don't pledge to pay their shareholders a regular, fixed sum unless they can afford it with plenty of room to spare. So where you find dividends, you'll often find a healthy bottom line.

But that assumption has its limits. As a dividend yield starts to climb well above market and sector norms, investors begin to wonder about that payout's sustainability. It could be that the company is dedicating too high a percentage of its profits to maintaining that dividend. Or it could be that the yield is growing because shares are diving, reflecting some sort of fundamental weakness.

For many reasons, "high" and "reliable" are two yield adjectives that aren't frequently joined at the hip. But it doesn't mean you'll never find the two hanging out.

Today, we'll explore five stocks doling out yields north of 4% — well above the average — that appear to be reasonably safe.

Data is as of July 22, 2026.

Our methodology for finding "safe" dividend stocks

Before we move on, let's be crystal clear: No dividend on this planet is 100% safe.

Dividend Aristocrats. Dividend Kings. Companies that have paid dividends for more than a century. All of these have seemingly bulletproof dividend programs, and every single one of them could shrink or outright suspend those distributions tomorrow.

That doesn't mean we think they're about to or even that they ever will. We're just stressing the importance of understanding the nature of dividends. With few exceptions — namely, real estate investment trusts (REITs) and business development companies (BDCs) — businesses aren't inherently obligated to pay us a dime, and they certainly don't have to ensure that we collect a certain level of income.

The best we can do is look for signs that a company can afford its dividend, and that management values maintaining or growing that dividend.

To get to our list of five safe, high-yield dividend stocks, I've looked for U.S.-domiciled and traded equities with the following features:

• At least $500 million in market capitalization
• A dividend yield of at least 4%
• At least 10 consecutive years of stable or growing dividends
• A dividend payout ratio of no more than 60% of estimates for 2026 adjusted earnings per share (in other words, they pay out no more than 60% of their profits as dividends)
• An average broker recommendation of 2.5 or lower within the ratings scale established by S&P Global Market Intelligence, implying they're a consensus Buy.

Again, while that doesn't guarantee that any of these dividends will be the same size (or be around at all) next year, next month or even next week, it may help us identify generous dividends that are more stable than similar-yielding companies.

Stocks are listed in reverse order of their consensus ratings — the lower the number, the better the analyst rating.

OceanFirst Financial

• Sector: Financials
• Market value: $1.1 billion
• Dividend yield: 4.1%
• Consensus rating: 2.29 (Buy)

OceanFirst Financial (OCFC) is the bank holding company for OceanFirst Bank, which is a 124-year-old community bank with 40 locations across five Northeastern states: Maryland, Massachusetts, New Jersey, New York and Pennsylvania.

There's little out of the ordinary here. OceanFirst offers consumer products such as savings and checking accounts, money market accounts, auto loans, student loans and mortgages. It also provides commercial and industrial loans, as well as real estate loans for commercial and multifamily properties.

OceanFirst is looking to bolster that latter business through its "Premier Banking" initiative, in which the company is prioritizing relationship-building and tailored solutions to attract commercial clients.

"Although we believe there remains a good amount of uncertainty regarding the ultimate ROI of the Premier Bank initiative (and the [commercial and industrial] banking hires), the project is off to a strong start and has the potential to meaningfully enhance OCFC's deposit base and franchise value if successful," write Keefe, Bruyette & Woods analysts Tim Switzer and Emily Lee, who rate the financial stock at Outperform.

The company also recently acquired commercial bank Flushing Financial, then announced it would be selling $1.4 billion in multifamily loans, which would amount to most of the multifamily loans it acquired from FFIC. In so doing, OCFC significantly reduced its overall exposure to multifamily housing.

OceanFirst isn't an annual dividend raiser, but it has improved its cash distribution a few times over the past decade. Its current quarterly payout of 20 cents per share amounts to a reasonable 43% of this year's earnings estimates — and more encouraging, just 35% of expected 2027 profits, which are expected to pop by 24% year over year.

Verizon Communications

• Sector: Communication services
• Market value: $184.9 billion
• Dividend yield: 6.4%
• Consensus rating: 2.27 (Buy)

Verizon Communications (VZ) is an American telecommunications giant, providing wireless phone service, broadband internet, fiber-optic service, wireline service and more. At the moment, it boasts about 147 million wireless retail connections and almost 17 million broadband connections.

Verizon somewhat resembles a utility stock, operating against precious few competitors — VZ, AT&T (T) and T-Mobile (TMUS) account for virtually all of the postpaid market — but also within saturated businesses that have limited room for organic growth.

It's currently trying to fend off its competitors by improving the customer experience.

"VZ delivered a major turnaround in subscribers despite being early days of its customer first strategy," Oppenheimer analysts (Outperform) wrote in April following the company's most recent earnings report. "Management is shifting from price increases and expensive device promotions to adding value, improving segmentation, and increasing automation. This improves CX, retention, and margins. The pivot comes at a slight sacrifice to short-term revenue growth, but is critical for growing subscribers — where share losses had caused the stock to lag peers over the past five years."

Verizon's growth plans also include its buyout of local exchange carrier Frontier Communications, which closed in January 2026. "Verizon is looking to expand both its spectrum asset and geographic footprint through acquisitions," says Argus Research analyst Marie Ferguson (Buy). "We think the acquisition with Frontier, a local exchange carrier (LEC), will help Verizon expand into the contested U.S. suburban and rural broadband market and drive earnings growth of about 6% in 2026."

VZ is also like utilities in that it makes up for its lack of growth prospects by paying a generous dividend. The payout, which has improved for 20 consecutive years, currently represents 58% of 2026 profit estimates.

Eastman Chemical

• Sector: Materials
• Market value: $7.98 billion
• Dividend yield: 4.8%
• Consensus rating: 2.00 (Buy)

Eastman Chemical (EMN) is a specialty materials company whose products are used across numerous industries, including agriculture, consumer goods, personal care, transportation and textiles. It offers acids, aviation fluids, animal nutrition products, copolyesters, plasticizers, heat transfer fluids, process fluids, solvents, turbo oils, and more.

Materials stocks are inherently cyclical, hinging not only on broader economic strength but also industry demand and individual product-demand cycles. For instance, right now, Eastman and other chemicals firms are struggling with weak demand from more cyclical industries such as construction, automobiles and consumer durables (i.e., appliances and electronics).

Still, Wall Street is broadly bullish on the name compared to its peers.

"Innovation and sustainability initiatives will likely help the company outpace end market demand trends," say Jefferies analysts, who call the stock a Buy. "The company's methanolysis technology is now proven at scale, and growth will likely be driven both by premium recycled content displacing mechanically recycled alternatives, and by new product launches from consumer brands seeking differentiated sustainability offerings. Strategic customer commitments from major packaging and consumer goods companies reinforce the durability of this demand even in a weaker macro environment."

Cyclical companies have to be somewhat conservative with their dividends, as their bottom lines can be more volatile than other industries. Still, despite what a high yield of almost 5% might suggest, Eastman's payout ratio of 54% isn't out of line with its peers.

Fidelity National Financial

• Sector: Financials
• Market value: $13.5 billion
• Dividend yield: 4.1%
• Consensus rating: 1.60 (Buy)

Fidelity National Financial (FNF) is a title insurance company that serves the real estate and mortgage industries. It provides title insurance, escrow and other title-related services; technology and transaction services; and mortgage transaction services. It also offers financial products such as annuities and life insurance.

Title insurers benefit from mortgage volumes, which tend to be spurred by lower interest rates. Just consider this bull case from Truist Managing Director Mark Hughes (Buy):

"FNF is the nation's largest title insurer; the company should be a beneficiary of lower interest rates as a result of Federal Reserve [easing]. … The macroeconomic indicators for the housing market are a primary driver of FNF's stock price."

However, Fidelity National Financial might be trying to swim upstream right now. Because while lower rates appeared to be the Federal Reserve's path of least resistance earlier in 2026, persistently high inflation has America's central bank increasingly poised to raise its target rate by the end of the year.

But even without Fed help in the near term, there are other reasons to like Fidelity National. Hughes adds that "Chairman Bill Foley and his team have a long track record of generating outsized returns across a broad spectrum of end markets." And Keefe, Bruyette & Woods' Bose George and Frankie Labetti (Outperform) add that, "As the largest title insurer in terms of market share, we believe FNF will continue to be able to use its scale to generate industry-leading margins."

Insurers also tend not to go out on a ledge when paying for their dividends, and FNF is no exception. It pays only about 40% of 2026 earnings estimates to fuel its 4.1% dividend.

American Tower

• Sector: Real estate
• Market value: $77.4 billion
• Dividend yield: 4.3%
• Consensus rating: 1.56 (Buy)

American Tower (AMT) is a global telecommunications REIT that leases out space on nearly 150,000 communication sites across five continents. Its tenants include wireless data and/or service providers, radio and television broadcast firms, companies in other industries, even municipal governments and federal agencies.

AMT shares a headwind with Verizon — a saturated U.S. market — but has other routes to growth.

"The company is a leader in tower services, and while domestic mobile spending has flattened, the company is focusing on international expansion of 5G networks and growth in mobile data consumption," says Argus Research's Ferguson (Buy). "It also entered the data center market through its 2021 joint venture ownership of CoreSite, which we see as a positive."

American Tower has been the weakest of these five safe dividend stocks over the past year, losing about 25% of its value. That's at least in part over worries that more promotional activity in the wireless business could dampen longer-term investments, which could in turn mute tower leasing growth.

But Citi's Michael Rollins (Buy) sees leasing activity stabilizing and the possibility for a new entrant into the mobile service space. "We also see potential for AMT to continue to evolve its data center business strategy, while management commentary leads us to believe the leaning is still as a net investor, rather than a net seller," he says.

As for the distribution? While higher-than-average payouts are the norm because of REITs' dividend mandate, AMT has never flashed a monster headline yield — indeed, January 2026 marked the first time shares have regularly paid above 4%.

Still, for now, the dividend is well-covered. When it comes to evaluating REIT dividends, the metric to use isn't EPS, but funds from operations (FFO), which measure the cash generated from a REIT's core operations. Typically, anything below 80% is considered safe, and American Tower's dividend currently represents just 70% of this year's FFO estimates.

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Stocks sold off Thursday as rising bond yields and surging oil prices spooked market participants. Poorly received earnings reports from a pair of Magnificent 7 stocks didn't help matters, with the main indexes now on track for another week of losses.

At the close, the blue-chip Dow Jones Industrial Average was off 1.0% at 51,711, the broader S&P 500 was 1.2% lower at 7,408, and the tech-heavy Nasdaq Composite was down 2.2% at 25,137.

Rising bond yields were one headwind for stocks today. The yield on the 2-year Treasury jumped 4.9 basis points to 4.351% — its highest level since February 2025. And the 10-year Treasury yield spiked 4.2 basis points to an 18-month high of 4.699%.

The surge in Treasury yields comes as oil prices climb and accelerate inflation worries. It's also lifting expectations for a rate hike later this year. Front-month West Texas Intermediate crude futures rose 6.2% to $92.19 per barrel, and are now up 33% month to date.

"Higher oil prices are the biggest near-term macro risk," says Sameer Samana, head of Global Equities and Real Assets at Wells Fargo Investment Institute (WFII). "Escalating Middle East tensions have pushed crude prices higher, raising concerns that inflation could reaccelerate and delay interest-rate relief … maybe even cause the Fed to hike."

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And higher Treasury yields, Samana adds, reflect "expectations that rates may stay higher for longer, creating potential headwinds for rate-sensitive sectors and long-duration assets."

According to CME Group FedWatch, futures traders are pricing in a 57% chance that the Federal Reserve will hike the federal funds rate by a quarter-percentage point in September — and a 26% probability it will raise rates by a half-percentage point.

The odds for a rate hike at next week's Fed meeting are currently at 36%, up from 12% one week ago.

Alphabet stock has its worst day since May 2025 on capex worries

In single-stock news, Alphabet (GOOGL) slumped 7.1% today, the Dow Jones stock's worst day since May 2025, after the Google parent reported earnings.

While Alphabet beat on the top and bottom lines on strong revenue growth in its Cloud, Search and YouTube segments, the company's increased spending is worrying Wall Street. In its earnings call, management said it is raising its full-year capex budget to a range of $195 billion to $205 billion from $180 billion to $190 billion.

The higher capex, Alphabet admits, will keep pressure on free cash flow — which came in negative for the first time in Q2 — but "enables us to capitalize on the AI opportunity and continue to drive attractive returns."

Tesla loses $203 billion in market value today

Fellow Magnificent 7 stock Tesla (TSLA) fell 14.5% — shedding $203 billion in market value — after the mega cap reported lower-than-expected second-quarter earnings. TSLA also saw free cash flow turn negative in Q2, reporting a deficit of $1.1 billion, while capex more than doubled from the year prior, to $5.8 billion.

In the company's earnings call, Tesla's chief financial officer, Vaibhav Taneja, said capex will rise even further from here.

"CapEx will grow for the next two to three years as we expand our robotaxi fleet, expand our production capacity for Optimus, make investments for semiconductor fab, install solar manufacturing capacity and AI compute infrastructure in addition to all the other expansions we'll do for other manufacturing for automotive," Taneja explained.

"TSLA is in the midst of a high investment period so capex efficiency is key with the payoff from these investments further down the road, in our view," says UBS Global Research analyst Joseph Spak.

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Two of the three main equity indexes opened lower on Wednesday as escalation of the war in the Middle East cast a "risk-off" pall on markets. Investors, traders and speculators eased back into "risk-on" names as the trading session evolved, with focus on the first two Magnificent 7 revelations of the earnings season. Midday momentum ebbed, though, and all three indexes closed lower.

"From this point forward," President Donald Trump posted on Truth Social before the opening bell, "any time the Islamic Republic of Iran shoots at a ship in the Strait of Hormuz, whether it be by Missile, Rocket, Drone, or any other device or weapon, the United States will bomb and destroy ONE BRIDGE OR POWER PLANT, including those located next to, or in, the Capital City of Tehran."

The front-month West Texas Intermediate crude oil futures contract was up another 2.8% to $86.66 per barrel. WTI has risen 29.3% since hitting an intraday "ceasefire" low of $67.04 on July 2. Crude oil closed at $67.02 on February 27, the day before the war in the Middle East began.

The 2-year Treasury yield hit another new 52-week high on the way to closing at 4.304% vs 4.261% on Tuesday, and the 10-year yield was up to 4.659% from 4.628%. As Bloomberg calculates, the 30-year yield, which ticked up to 5.149% from 5.131%, has now been above 5% for more days in 2026 than in any other year since 2007.

Technology opened lower a day after a big bounce led by semiconductor stocks including Micron Technology (MU, -1.2%) and SK Hynix (SKHY, -3.9%) before rallying through midday. At the same time, Nvidia (NVDA, +2.3%) posted the biggest gain among Dow Jones stocks.

By the closing bell, the tech-heavy Nasdaq Composite was down 0.6% at 25,690, the broad-based S&P 500 was off 0.1% at 7,498, and the blue-chip Dow Jones Industrial Average had ceded six points, or 0.01%, to 52,218.

"This volatility is due primarily due to rising interest rates driven by the escalating conflict in Iran and rising energy prices," writes Louis Navellier of Navellier & Associates.

What you need to know about Alphabet earnings

Alphabet (GOOGL, -1.5%), which replaced Verizon Communications (VZ, +1.1%) in the Dow on June 29, posted earnings for the first time as a member of the 30-stock index after today's closing bell.

Electric vehicle maker Tesla (TSLA, -1.3%) and the Google parent are the first two of the Magnificent 7 stocks to report this season.

The big number to track here is second-quarter capital expenditures. Alphabet said it would spend $180 billion to $190 billion this year to build out its artificial intelligence (AI) infrastructure.

According to FactSet, Wall Street forecast capex of $45.1 billion for the three months through June 30, an estimated increase of 101.3% from the $22.4 billion Alphabet laid out a year ago, and a full-year run rate of $180.4 billion.

How GOOGL is trading right now is probably a function of where its second-quarter capex came in relative to its guidance and Wall Street's estimate, as well as whether management has revised its outlook.

Constellation has the power

Energy stocks, including Chevron (CVX, +1.0%) and Exxon Mobil (XOM, +1.8%), were boosted again by crude oil's rise. CVX was up 12.9% and XOM 10.7% from July 2 through July 21 vs a gain of 0.4% for the S&P 500.

The vertically integrated supermajors, with upstream, midstream and downstream exposure, will update the market on how the energy shock is affecting their operations before the opening bell next Friday, July 31.

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Utility stocks, well positioned to serve power-hungry hyperscalers but also relatively stable vs AI stocks, were tops among the 11 market sectors recognized by S&P Global Market Intelligence.

Constellation Energy (CEG, +4.8%), as Morgan Stanley analyst David Arcaro noted when he picked up coverage of the sector leader in March, is also getting a lift from the biggest carbon-free nuclear generation capacity in the U.S.

Indeed, Constellation's 21 reactors across 12 facilities in Illinois, New York, Pennsylvania, Maryland, New Jersey and Texas can power a lot of data centers.

Arcaro recently reiterated his Overweight (Buy) rating on CEG and raised his 12-month target price from $364 to $366. Constellation Energy is scheduled to release its second-quarter earnings report on Thursday, August 6.

Meanwhile, according to The Wall Street Journal, President Trump has approved a 30-year agreement to provide Saudi Arabia with a civilian nuclear power program "estimated to be worth tens of billions of dollars."

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"Nvidia, Nvidia, Nvidia. SpaceX, SpaceX, SpaceX. But of course, Nvidia. Micron, sure, and let's Apple too. But when it comes right down to it, Nvidia, SpaceX, Meta, Alphabet, SpaceX, Nvidia, Alphabet and Nvidia."

If that's what it feels like to turn on CNBC, check out your favorite investing website or scroll through your financial social feeds … I agree. I've spent more than a decade in financial media, and I'll be the first to admit that we don't just talk about the stocks people follow — we drown them in related content.

And at the cost of ignoring some duller but still plenty productive stocks.

Well, today, I'm setting aside a little bandwidth for the sleepers, the yawners, the ho-hum companies that have largely trudged along, printing profits and padding portfolio gains.

How we found our five "sleeper" blue-chip stock picks

You won't read about high-flying semiconductor stocks or the hottest upcoming initial public offerings (IPOs) here.

Instead, I'm going to run down a group of relatively mundane blue chip stocks that don't generate many headlines, but that have two qualities we shouldn't ignore:

• They've managed to outperform the S&P 500 over the past five years on a total-return basis.
• They're highly rated by Wall Street's analyst community.

I put together a simple quality screen — S&P 500 components that are worth at least $50 billion by market capitalization, have outdone the index over the past half-decade, have at least 10 covering analysts and have an average broker recommendation of 2.5 or lower within the ratings scale established by S&P Global Market Intelligence, implying they're a consensus Buy.

At that point, selection was largely subjective. I opted for higher-conviction Buy ratings. I ignored attention-grabbing sectors such as technology and communication services. I favored companies that, while occasionally well-known by consumers, rarely get financial media coverage outside of their quarterly earnings reports.

Data is as of July 20. Dividend yields represent the trailing 12-month yield, a standard measure for equity funds.

Motorola Solutions

• Sector: Information technology
• Market value: $68.2 billion
• Dividend yield: 1.2%
• Consensus rating: 1.64 (Buy)

Of course, the first sleeper pick is a tech stock. I'm not a reliable narrator. I've never claimed to be.

But all jokes aside, I'm making a point by highlighting Motorola Solutions (MSI), which is pretty humdrum compared to the chip and app names that largely define the modern-day technology sector.

When most people think of Motorola, they think of smartphones — Edge, Moto G, Razr and more. But that's Motorola Mobility, which has been a wholly owned subsidiary of Lenovo for more than a decade. Motorola Solutions was created three years earlier in a corporate split.

MSI's primary businesses are critical-communications land mobile radio (LMR) devices and networks (think emergency-personnel handheld radios); command-center technologies; and video security. Impressive technology? Sure. Does the media talk about it the same way it does large language models (LLMs) and quantum computing names? Nope.

Still, this is a $70 billion outfit with roots that go back nearly a century. It might not be an explosive grower, but it has out-returned the S&P 500 by several percentage points over the past 10 years and offers a modest dividend to boot.

The pros love the stock, too. MSI is currently covered by 14 analysts, a dozen of whom deem it a Buy. The remaining two calls are Holds; no one thinks it's a Sell. And they all believe Motorola will continue delivering decent bottom-line improvement, with long-term annual earnings-growth estimates sitting around 10% annually.

"Record demand for public safety communications, video security, and command center software should drive long-term [earnings per share] growth in the low double digits when taking into account organic growth, acquisitions and stock buybacks," say William Blair analysts, who rate the stock at Outperform (equivalent of Buy). "The EPS [compound annual growth rate] from 2017 through 2025 was 14%. We believe the annual stock return will at least match EPS growth."

Speaking of acquisitions, the company announced in early June a $1.5 billion acquisition of Israel-based counter-drone provider D-Fend Solutions, which complements its 2025 Silvus acquisition and gives it additional ammunition to pursue Defense Department contracts.

Eaton

• Sector: Industrials
• Market value: $158.4 billion
• Dividend yield: 1.1%
• Consensus rating: 1.63 (Buy)

Many names attached to the artificial intelligence (AI) trend have blown up in popularity (and stock price) over the past few years, so it's difficult to find AI-connected names that are flying relatively under the radar.

But Eaton (ETN), despite its success, still is far from a household name.

Eaton is a global intelligent power management company. On the AI front, ETN has partnered with companies such as Siemens Energy (SMERY) and — you guessed it — Nvidia (NVDA) to improve data center infrastructure. And in 2025, Eaton bought Resilient Power Systems, which makes solid-state transformer technology that may simplify the building of AI data centers.

But ETN's offerings go well beyond AI. The company offers power distribution, energy storage, backup power, electronic components, data and video cables, lighting and controls, utility and grid solutions, server racks and more to a variety of industries.

"This blue-chip industrial company is benefiting from megatrends, such as energy transition, electrification, digitalization, and infrastructure spending, that are driving growth in its end markets," says Argus Research analyst Kristina Ruggeri, who rates the industrial stock at Buy. "The company has been experiencing strong orders and record backlogs that should position it well to deliver EPS growth over the long term, driven by margin improvement and top-line growth."

Also worth noting is the company's June announcement that its Mobility Group would combine with automotive industrial firm Dana (DAN) in a Reverse Morris Trust, following which Eaton shareholders would own 50.1% of the combined entity.

"We view this ... announcement as a clear positive for ETN shareholders as it accelerates the company's plan to focus on its core higher growth/higher margin Electrical and Aerospace businesses," say BNP Paribas Equity Research senior analysts James Picariello and Andrew Buscaglia. The firm rates ETN at Outperform. "As we've discussed, exiting Mobility would help ETN create a more concentrated portfolio aligned with key megatrends in electrification, data centers and aerospace & defense."

All told, ETN enjoys 22 Buys against four Holds and just one Sell, according to S&P Global Market Intelligence. And the consensus view is for annual average earnings growth of 10% over the long term.

AutoZone

• Sector: Consumer discretionary
• Market value: $49.0billion
• Dividend yield: N/A
• Consensus rating: 1.48 (Strong Buy)

AutoZone (AZO) is a retailer and distributor of automotive replacement parts and accessories, boasting nearly 7,900 stores across all 50 U.S. states, the District of Columbia, Puerto Rico, Mexico and Brazil.

It's a name most everyone knows, but that few people have on the tip of their tongue, at least as stocks are concerned. It's a brick-and-mortar retailer that dishes out motor oil, brakes, batteries and car-washing goods — as mature a business as they come.

But while AZO might not enjoy much run time on CNBC, it's well respected among the research community. Currently, 23 analysts consider AutoZone shares to be a Buy, while the remaining four covering analysts call it a Hold. And while it's a mature business, the pros still see the retailer delivering 13% average annual long-term earnings growth.

That bullishness comes amid a rough spell for AutoZone. While the company has outperformed the S&P 500 over the trailing five-year period, the past year has seen AZO lose almost 20% of its value while the index has advanced by roughly as much. The latest setback stemmed from a weak fiscal third-quarter report announced in May.

"While AZO's Q3 results fell short of expectations following several quarters of underperformance, we believe today's selloff was overdone," says Morgan Stanley analyst Simeon Gutman (Overweight, equivalent of Buy). "We understand investors are increasingly questioning the credibility of the AZO story given uneven execution over the last three to four quarters; however, Q3 represented a step in the right direction from an earnings standpoint, with [earnings before interest and taxes] inflecting positively and the setup for further acceleration improving into Q4 and FY27."

Analysts believe near-term growth from new "megahubs" — larger locations that act as regional supply centers for retail stores and repair shops — and longer-term opportunity from international expansion.

"Expect U.S. megahub expansion and U.S. store growth to help offset transitory international softness," says Jefferies analyst Bret Jordan (Buy). "We continue to view [Mexico and Brazil] as attractive long-term total addressable market growers with significant market share opportunities for AZO. In the interim, we expect megahub to drive healthy domestic [do-it-for-me] share expansion while new stores entering the comp base likely add ~150 basis points to same-store growth."

Cardinal Health

• Sector: Healthcare
• Market value: $53.1 billion
• Dividend yield: 0.9%
• Consensus rating: 1.47 (Strong Buy)

Most water-cooler-worthy healthcare stories come from pharmaceuticals or biotech companies developing the latest breakthrough drugs, or medical device firms wizarding their way to technologies that change the way we recover and live.

Cardinal Health (CAH) isn't that.

This blue-chip healthcare stock is as behind-the-scenes as it gets, distributing pharmaceuticals, medical supplies, consumer products and data solutions to the vast majority of the nation's hospitals, pharmacies, clinical labs and ambulatory surgery centers.

These businesses don't exactly generate headlines, but they provide robust revenue diversification with plenty of opportunity for growth — in fact, CAH shares have delivered a total return of 360% over the past five years, crushing the healthcare sector and the broader market.

That performance has been driven by a long string of consecutive quarterly earnings beats, which stands at 15 following its fiscal Q3 reported in late April.

"Pharmaceutical and Specialty Solutions revenue grew 11% year-over-year to $56.1 billion, supported by branded and specialty pharmaceutical sales growth," notes Daniel Rich, an analyst for independent research firm CFRA, which rates the stock at Buy. "We also think free cash flow generation remains robust, as CAH raised FY26 guidance to a $3.5 billion midpoint from $3.25 billion previously."

That cash flow is especially important given Cardinal's status as a Dividend Aristocrat. CAH currently boasts 30 consecutive years of uninterrupted payout growth, most recently announcing a 1% uptick to 51.58 cents per share in early May.

Cardinal Health also sports a healthy bull camp of 15 Buys against three Holds and no Sells. As a group, they see CAH delivering 17% average annual earnings growth over the long term.

The TJX Companies

• Sector: Consumer discretionary
• Market value: $167.2 billion
• Dividend yield: 1.3%
• Consensus rating: 1.38 (Strong Buy)

The highest-rated of these "sleeper" blue chip stock picks is The TJX Companies (TJX).

Most people know this consumer discretionary stock for its TJ Maxx fashion retail locations, but it's also responsible for a host of other low-cost chains, including Marshalls department stores, furnishing and décor retailer HomeGoods, outdoors gear seller Sierra, and Canadian brands HomeSense and Winners. It also operates as TK Maxx in Europe and Australia.

Physical retail has generally been in a state of decline for years, and COVID finished off a number of brick-and-mortar retailers. But TJX continues to find demand for its steals and deals, which has driven shares to a market-beating 140% total return over the past five years and kept analysts optimistic about its ability to continue climbing.

"The off-price channel offers a very attractive value prop to (1) brands (efficient inventory management assistance), (2) landlords (stable & attractive foot traffic), and (3) shoppers (20%-60% off hot products in a differentiated treasure hunt experience)," says Truist Vice President Joseph Civello (Buy). "With its leading scale position, we believe TJX has access to the best product and convenient locations, which attracts the highest value traffic (creating a flywheel that further enhances their competitive edge).

"We believe this will continue to fuel its consistent algo with highly visible top/bottom-line growth in a vertical that we view as one of the most attractive in retail."

Civello is hardly alone. The Street has 19 Buy calls on TJX shares, versus a lone Hold and a single Sell. Long-term growth expectations aren't exactly electric, but at a 9% average annual clip, that's still respectable for a mature budget-store empire.

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Technology stocks took off on Tuesday, and crude oil prices did the same. Investors, traders and speculators are looking forward to imminent earnings announcements from two of the Magnificent 7, even as the U.S. and Iran are escalating the war in the Middle East.

At the closing bell, the tech-heavy Nasdaq Composite was up 1.3% at 25,837, the broad-based S&P 500 had added 0.9% at 7,509, and the blue-chip Dow Jones Industrial Average was higher by 0.7% at 52,224.

Front-month West Texas Intermediate crude oil futures rose 2.7% to $84.68 per barrel, and the 2-year Treasury yield ticked up to 4.266% from 4.215% on Monday.

The iShares Semiconductor ETF (SOXX, +5.5%) extended its gain on Monday into a full-blown rally on Tuesday, though the Roundhill Magnificent Seven ETF (MAGS, +0.01%) generated a more modest return.

"The market continues to look through the Middle East situation as transitory and is staying focused on strong earnings," Louis Navellier of Navellier & Associates observes. "The trend remains positive."

It's all about earnings

Google parent Alphabet (GOOGL, -1.4%) and electric vehicle maker Tesla (TSLA, +2.5%) are scheduled to report second-quarter earnings after the closing bell on Wednesday.

Much is riding on all of the Magnificent 7 stocks, Nvidia (NVDA, +2.0%) in particular. As FactSet analyst John Butters notes, the estimated year-over-year earnings growth rate for the group is 31.1%.

But there's a lot riding on earnings generally: The other 493 S&P 500 stocks are expected to post bottom-line growth of 22.8%, which would be their highest growth rate since the fourth quarter of 2021.

"In fact," Butters writes, "four of the five top contributors to earnings growth for the S&P 500 for Q2 2026 are not 'Magnificent 7' companies: Micron Technology (MU, +12.2%), Chevron (CVX, +0.7%), Exxon Mobil (XOM, +2.3%), and Broadcom (AVGO, +2.2%)."

Indeed, the leader of the AI revolution is the only Mag 7 stock that's also a top-five contributor to current earnings growth estimates. Nvidia posted fiscal 2027 first-quarter results in May and will report again on Wednesday, August 26.

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The energy stocks stand out, too, amid the bottleneck at the Strait of Hormuz. Chevron and Exxon Mobil are scheduled to report second-quarter results before the opening bell next Friday, July 31.

Micron and Broadcom revealed blowout results for their respective fiscal quarters in June. The semiconductor stocks are scheduled to report again in September.

3M looks good

3M (MMM) was No. 1 among the 30 Dow Jones stocks on Tuesday, rising as much as 10.7% to within $1.26 of its February 12 52-week high, after management reported expectations-beating results and raised its full-year guidance.

3M now sees earnings of $8.80 to $8.95 per share for 2026, up from a range of $8.50 to $8.70, with CEO Bill Brown citing "strong first-half performance and continued momentum."

The industrial stock generated a year-to-date total return of 0.3% through Monday vs 9.4% for the S&P 500, sagging in January after management shared lackluster initial guidance and trending lower through May.

Genuine Parts cuts some guidance

Genuine Parts (GPC, -2.7%) is one of the best stocks to buy for dependable dividend growth because of a 70-year history of raising its quarterly payout. Management of the automotive and industrial parts maker sustained that record in February with a 3.2% increase.

At the same time, though, the consumer discretionary stock said it was splitting into two publicly traded companies, "Global Automotive," which operates as the familiar NAPA retail front, and "Global Industrial," which works under the Motion banner.

The separation is costing more than management forecast, so Genuine Parts updated elements of its full-year forecast, most notably GAAP EPS. That estimate was revised from $6.10 to $6.60 to $5.90 to $6.40.

Management reaffirmed its adjusted EPS guidance range, $7.50 to $8, as well as its 3% to 5% revenue growth rate forecast. Still, that updated element shook the market.

It appears management understood the gravity of its decision and conducted a thorough review: "The company considered its recent business trends and financial results, current growth plans, strategic initiatives, global economic outlook, geopolitical conflicts and the potential impact on results in updating its outlook."

Genuine Parts hasn't defined a post-separation dividend policy, though details will likely be forthcoming following the forecast completion of the separation in the first quarter of 2027.

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• How to Invest in the Modern Space Race

Space exploration came to the world more than a decade after World War II ended. To begin with, two countries dominated the field: America under the auspices of NASA (National Aeronautics and Space Administration) and the Soviet Union's slew of space design bureaus. It got dubbed the Space Race.

Fast forward to now, and there's another space race, this time it's happening via private and public enterprise. That means you could profit from companies involved in the space sector by purchasing relevant stocks. But which ones?

Top of the headlines is Elon Musk's SpaceX (the Space Exploration Technologies Corp, ticker symbol: SPCX), which, as well as rocketry, includes data centers, artificial intelligence and Starlink, the 10-satellite communications network. The company's initial public offering, in June, raised an extraordinary $85.7 billion, $10 billion more than expected. That made it the largest IPO in history. As if that wasn't enough excitement, SpaceX's shares soared to approximately $177 in less than a week, up from $135 at the IPO. By then, the market capitalization hit $2.4 trillion.

As with many things involving Elon Musk, there are those who love it and those who think the opposite. Michael Monaghan, portfolio manager at Founder ETFs in Dallas is among the former: "We are bullish on SpaceX. We think SpaceX will be the dominant space company with the highest efficiency and lowest price."

Monaghan also views a defense angle that SpaceX could benefit from. "The U.S. wants a moon base, and there is only one company that can do this: SpaceX," he says. "It's being planned partly for geopolitical reasons, with a new report saying, 'the Space Force needs to prepare for an in-person moon conflict with China.'"

On the other hand, there are skeptics, notably Morningstar's industrial equity analyst Nick Owens, who believes the value of SpaceX is $63 per share, which is less than half the IPO price. He's waiting for evidence that SpaceX's goal of putting data centers in space, along with artificial intelligence, is likely to materialize.

"The validation evidence would be that the rockets are reliable," Owens says. "And to find out the commercial viability in space, we will want to know the relative costs to those data centers on Earth."

Of course, there is more to the new space race than SpaceX. For instance, there's Rocket Lab (RKLB), a launch services provider. "I am very positive they are doing really good work in small launches that few others do," says Keith Snyder, a senior analyst at CFRA Research, based near Denver.

Snyder recently published a comment saying that Rocket Lab "is recognized as a preferred supplier across the space industry, with components and platforms being selected for flagship missions such as Artemis, Mars rovers and the International Space Station resupply, as well as for national security programs."

There's also good news on bookings, according to Snyder. He wrote, "Strong customer confidence and demand for [Rocket Lab's] Neutron launch vehicle was evidenced by significant pre-launch bookings." The company also has a record backlog of launches with 70 launches scheduled. Rocket Lab stock recently traded at $107, but Snyder has a one-year target of $140.

Aerospace company Boeing (BA) might not stand out as a major space competitor, but it does have a role in making bespoke rockets, rather than mass-produced ones, writes CFRA analyst Matt Miller. He also notes that Boeing has huge revenue, mostly from its commercial airplane sales: $89.5 billion last year and a forecast of $98 billion this year.

There's also limited competition for its products. The combination of solid revenue and minimal competition (notably from Airbus) should provide some economic ballast for the stock while still giving it a foothold in the Space sector. Miller has a 12-month target of $278 for Boeing stock, compared to a recent price of $223.

For those who want to avoid buying individual stocks, there are exchange-traded funds that track baskets of space-related stocks, such as the VanEck Space ETF (WARP), the Procure Space ETF (UFO) and the ARK Space & Defense Innovation ETF (ARKX). Overall, these funds will likely be less volatile than any individual space-related shares.

Note: This item first appeared in Kiplinger Retirement Report, our popular monthly periodical that covers key concerns of affluent older Americans who are retired or preparing for retirement. Subscribe for retirement advice that's right on the money.

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With many Big Tech names lining up to report quarterly results this week and next, investors, traders and speculators would prefer to focus on AI, earnings and guidance rather than uncertainty about the Middle East, inflation and interest rates. The main equity indexes reflected this balancing act on Monday.

At the closing bell, the tech-heavy Nasdaq Composite was down 0.05% at 25,508, the S&P 500 had slipped 0.2% to 7,443, and the blue-chip Dow Jones Industrial Average was off 0.6% at 51,841.

The front-month West Texas Intermediate crude oil futures contract added 0.9% to $82.49 per barrel, and the 2-year Treasury yield ticked up to 4.208% from 4.172% on Friday.

The iShares Semiconductor ETF (SOXX, +0.5%) recovered after posting a 10.2% decline last week amid renewed concerns about hyperscaler spending on artificial intelligence infrastructure, as well as another threat posed by an emergent Chinese AI model.

"Despite the recent pullback," observes LPL Financial Chief Technical Strategist Adam Turnquist, citing last week's 1.6% decline for the S&P 500, "market breadth continues to improve."

As Turnquist notes, the percentage of S&P 500 stocks trading above their 200-day moving average has increased to nearly 70% from just above 50% in May, "signaling that participation beneath the surface remains considerably healthier than it was just a few months ago."

At the same time, price action remains volatile amid a cycle of escalating and de-escalating U.S.-Iran tensions.

Apple falls from high branches

Apple (AAPL, -2.1%) was one of three Magnificent 7 stocks in the red on Monday, the share price for the iPhone maker tracking back after hitting new highs on Friday, likely due to some profit-taking.

AAPL reached a fresh intraday peak of $334.99 and a closing record of $333.74 on July 17, briefly overtaking Nvidia (NVDA, +0.2%) as the biggest company in the world based on a market cap.

Tesla (TSLA, -3.0%), meanwhile, sold off ahead of its turn on the earnings calendar after the closing bell on Wednesday. Tesla pre-reported a 25% increase in EV deliveries during the second quarter.

TSLA hasn't seen much upside based on its relationship to SpaceX (SPCX, -3.3%), though the consumer discretionary stock has drifted lower in the afterburn of the biggest IPO in stock market history.

While AAPL was dragging on the index, Google parent Alphabet (GOOGL, +1.5%) was among the top-performing Dow Jones stocks on Monday, along with Amazon (AMZN, +1.1%) and Microsoft (MSFT, +2.2%).

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Alphabet is also scheduled to report second-quarter results after Wednesday's closing bell. Amazon and Apple are scheduled to report on July 30, Microsoft on July 29.

For the record, Meta Platforms (META, -0.02%) closed marginally lower on Monday. The Facebook parent is scheduled to report earnings on July 29. Nvidia will report on Wednesday, August 26.

AMC's rise is Homeric

AMC Entertainment (AMC), among the most notorious small-cap stocks in financial market history, was up as much as 27.8% on Monday after management reported the highest revenue in the movie-theater operator's more than 100 years in business.

AMC generated earnings of 14 cents per share vs a Wall Street forecast for a loss of four cents per share. Revenue grew by 14.2% to $1.59 billion, topping a consensus estimate of $1.5 billion. Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) was up 69.6% to a company-record $321.4 million.

According to CEO Adam Aron (PDF), it's the first time AMC has surpassed $300 million adjusted EBITDA for a three-month period, and AMC also generated $190.1 million in free cash flow.

The CEO is optimistic: "This weekend's powerful debut of Universal Pictures and Christopher Nolan's THE ODYSSEY, with an encouraging media reported $124 million domestic opening, is the latest reminder of the strength of today's theatrical marketplace."

Aron says the filmed version of Homer's epic poem follows a second quarter during which six different movies posted domestic opening weekend gross box office totals of more than $75 million.

"We believe that movie theatres will enjoy, in the full twelve-months of 2026, their strongest yet post-pandemic year, at both the domestic and the global box office," the CEO concludes.

Indeed, with a year-to-date total return of almost 25% vs less than 10% for the S&P 500, the freebies aren't the only thing you can enjoy about this stock.

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Investor fervor for artificial intelligence (AI) keeps making dividend stocks look downright dumpy. Over the past 12 months, the S&P 500 has returned an eye-popping 29.8%, while the Kiplinger Dividend 15, the list of our favorite dividend-paying stocks, returned an average of 13.4%. Just three — Broadcom (AVGO), Johnson & Johnson (JNJ) and recent addition U.S. Bancorp (USB) — beat the market.

What a world we live in, when a 13% annual return is a middling performance. Of course, much of the story remains the mega-cap Magnificent Seven technology stocks that continue to drive the returns of the S&P 500 and now make up an outsize proportion of this primary measure of the markets. Although five of the seven pay teeny-tiny dividends, the stocks are not on anyone's list of income investments.

Slice and dice the S&P 500 numbers, and you'll see better news for the dividend-hungry. Of the 400-plus stocks in the S&P 500 that make a payout to their investors, the median 12-month return has been 14.0%, according to data from S&P Global Market Intelligence. The 100 or so that don't pay dividends had a median return of 6.4%.

In this context, the Dividend 15 looks okay, with seven outperforming the median and eight falling below. The weakness in our squad represents another market theme of the past year: fears that a faltering economy will crimp consumer spending.

Look at four of the five stocks that lost ground over the past 12 months: McDonald's (MCD), Home Depot (HD), Procter & Gamble (PG) and Mastercard (MA). The profits of all four depend on open wallets, but consumer sentiment is testing lows.

Take McDonald's. There's evidence that the world's biggest burger seller is succeeding in winning back value-oriented customers after years of price hikes. Sales at restaurants open for at least one year increased 3.8% worldwide in the first quarter. The company's CEO blunted enthusiasm on the company's May 7 investor call, though, by saying consumer sentiment "may be getting a little bit worse."

One believer that McDonald's has the special sauce: Goldman Sachs, which has it on its U.S. Conviction List of Buy recommendations. McDonald's, Goldman says, has "the right menu, at the right time, everywhere in the world."

Three of the Dividend 15 have raised their payouts since our last review, all modestly. J&J increased its dividend by 3.1%, P&G by 3.0% and Walmart (WMT) by 5.3%. All three are members of our Stalwarts list, where consistency of dividend hikes is paramount.

Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.

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Another down day for tech stocks weighed on the broader market Friday, with today's leg lower sparked by reports that a new artificial intelligence model from Chinese startup Moonshot AI bridges the gap with several U.S. models. Poorly received earnings results from streaming giant Netflix (NFLX) weighed on sentiment, too.

At the close, the tech-heavy Nasdaq Composite was down 1.4% at 25,520, the broader S&P 500 was off 1.0% at 7,457, and the blue-chip Dow Jones Industrial Average was 0.8% lower at 52,146.

News that Moonshot AI's Kimi K3 is powerful enough to rival models from OpenAI and Anthropic revived competition fears — and rehashed memories from early 2025, when China's DeepSeek sent stocks into a tailspin. It also pressured several AI-related names, including Nvidia (NVDA, -2.2%) and Intel (INTC, -2.0%).

Netflix stock slides after earnings

A negative reaction to Netflix's second-quarter results also weighed on the S&P 500 and Nasdaq today, with the communication services stock sliding 7.3% — its worst day since April 17.

While the company's earnings of 80 cents per share beat analysts' estimates, its revenue of $12.56 billion fell short and its third-quarter revenue forecast came in slightly below the consensus.

In addition, Netflix said it will begin reporting engagement data on an annual basis vs a bi-annual one. "The goal of separating the publication of the report from our earnings results is to keep the focus on our primary financial metrics — revenue and operating profit," the company explained.

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Despite the top-line miss and subsequent stock sell-off, Argus Research analyst Joseph Bonner reiterated a Buy rating on Netflix. He also maintained a $120 price target, representing implied upside of 74% to current levels.

"While competition is intense amid macroeconomic uncertainty, Netflix remains the 'anchor tenant' for consumers in long-form video streaming," says Bonner. "We see the company's incremental moves into live-event sports programming as particularly directed at enhancing its advertising market as well as subscriber acquisition," adding that live events have a higher ad value than scripted content.

As for that advertising business, Bonner notes that Netflix expects ad revenue to double this year, to $3 billion, showing that this segment "continues to scale rapidly.

Travelers soars on Q2 beat

On the plus side of the ledger was The Travelers Companies (TRV), which jumped 9.2% — making it the best Dow Jones stock today — after the property and casualty insurer reported better-than-expected second-quarter results.

In addition to higher demand for insurance, Travelers also saw its catastrophe losses narrow in Q2 and its net investment income soar.

"The scale of our earnings and cash flow enable us to invest in differentiating technology, including AI, at a level that sets us apart, further strengthening the competitive advantages that power those results," said Travelers CEO Alan Schnitzer.

Ahead of earnings, Truist Securities analyst Mark Hughes initiated coverage on the blue chip stock with a Buy rating, saying it is trading at an attractive valuation. "More broadly, we believe the P&C group should be a good performer in light of its consistent topline, limited credit exposure, and moderate interest rate sensitivity."

The earnings calendar heats up next week, with Magnificent 7 stocks Alphabet (GOOGL, -2.2%) and Tesla (TSLA, -2.6%) both reporting.

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Stocks were choppy Thursday as market participants took in a fresh round of earnings reports and several major developments in the healthcare space. Wall Street also watched as chip stocks continued to sell off, with one company's quarterly results spooking this once-hot corner of the market.

At the close, the blue-chip Dow Jones Industrial Average was down 0.2% at 52,552, while the broader S&P 500 was off 0.5% at 7,533 and the tech-heavy Nasdaq Composite had slumped 1.5% to 25,881.

The Dow's losses were limited thanks to a big regulatory win for drugmaker Merck & Co. (MRK), with the healthcare stock climbing 3.3% after the Food and Drug Administration (FDA) approved its daily pill to treat cholesterol.

"Merck's approval is significant because LIPFENDRA, or enlicitide, is the first FDA-approved oral PCSK9 inhibitor," explains William Soliman, Ph.D., founder and CEO of the Accreditation Council for Medical Affairs (ACMA). "It offers the LDL-lowering power associated with injectable PCSK9 medicines in a once-daily pill."

And strategically, Soliman says, "the approval demonstrates that Merck is building beyond oncology as it prepares for Keytruda's eventual loss of exclusivity."

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The 30-stock index was also buoyed by a well-received earnings report for UnitedHealth Group (UNH, +1.2%). The country's largest health insurer by revenue and market share disclosed higher-than-expected earnings and revenue for its second quarter and raised its full-year forecast.

"Overall, this is an impressive beat-and-raise in Q2, which typically dictates the trajectory for the year, is highly encouraging," says Oppenheimer analyst Michael Wiederhorn, who has an Outperform (Buy) rating on the Dow Jones stock.

Taiwan Semi earnings send chip stocks lower

Elsewhere on the earnings calendar, Taiwan Semiconductor Manufacturing (TSM) posted impressive year-over-year growth in its second-quarter profit and revenue, thanks to strong demand for the tech giant's artificial intelligence (AI) chips.

TSM also gave upbeat third-quarter guidance and lifted its full-year capital expenditures budget to a range of $60 billion to $64 billion, up from its previous forecast for spending of $52 billion to $56 billion.

But the semiconductor stock fell 2.3% today. One reason for today's decline could be quarter-over-quarter revenue declines in several of its non-AI legacy technologies, says Needham analyst Charles Shi, Ph.D. "This is probably a warning sign that the higher memory prices may already be hurting mainstream semiconductor demand," he explains.

Whatever the reason, TSM's sell-off was enough to keep pressure on several chip stocks. Micron Technology (MU), for one, dropped 5.7% and is now down 26% since the start of July. Sandisk (SNDK) fell 12.6% today and is off 38% month to date. Still, the tech stocks remain 200% and 493% higher, respectively, for the year to date.

AtaiBeckley soars 33% on Eli Lilly bid

In non-earnings news, AtaiBeckley (ATAI) was one of the biggest gainers on Thursday, surging 33.4% after Eli Lilly (LLY, +1.2%) said it will buy the psychedelics drugmaker for $2.8 billion in cash, with another $1 billion tied to development and regulatory milestones.

"Lilly is using the financial strength generated by its obesity and diabetes franchises to diversify into neuroscience and other high-need therapeutic areas," says ACMA's Soliman. And while the risks are considerable, he believes there is a substantial opportunity "because treatment-resistant depression affects patients who have already failed multiple conventional therapies."

The potential $3.8 billion purchase price is a drop in the bucket for the blue-chip drugmaker, whose cash and cash equivalents totaled $7.3 billion at the end of 2025.

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• The Best Ways to Invest Your Super Catch-Up Contributions
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Americans 50 and older have long been allowed "catch-up contributions" to their 401(k) plans, IRAs and other retirement accounts. The reason is straightforward: As the runway to retirement gets shorter, Uncle Sam wanted to incentivize as much saving as possible.

But under the 2022 Secure 2.0 Act, Congress allowed for additional "super" catch-up contributions for Americans age 60 to 63.

Today, we're going to cover how these enhanced super catch-ups work and the best ways to invest them in 2026.

What is a super catch-up contribution?

All working Americans with access to an employer 401(k) or similar plan can contribute up to $24,500 in 2026 via tax-free salary deferrals. That's a $1,000 increase on 2025 levels.

If you're 50 or older, the limits get higher. You can contribute an additional $8,000, bringing the total to $32,500.

Under the Secure 2.0 Act, these contribution levels get even more supersized. Employees age 60, 61, 62 or 63 can chip in an additional $11,250, rather than the standard $8,000. That brings the total amount to $35,750. Contributions from employees older than 63 are capped at $32,500 ($24,500 plus the $8,000 catch-up).

Note that none of these figures include employer matching or profit sharing. Depending on the generosity of your employer, matching can add thousands or even tens of thousands of dollars in additional tax-deferred savings.

Note that these limits only apply to employer plans such as 401(k) plans. There is no enhanced super catch-up for traditional IRAs or Roth IRAs. Workers 50 and older can contribute an additional $1,100, but there are no special rules for those age 60 to 63.

There's obviously no substitute for starting to save for retirement early and allowing compounding to work its magic. But regardless, the super catch-up contributions certainly allow Americans to turbocharge their retirement savings in what are often their peak earnings years.

How to invest your super catch-up contribution

Now for the fun part. You've managed to supersize your retirement contribution for the year. What's the best way to invest it?

The answer will depend on a couple of factors, including how close you are to meeting your retirement goals. If you're not quite where you want to be, perhaps you still need aggressive growth. If you're near your retirement savings goal, you might be transitioning into income and distribution strategies.

You'll also need to consider where your assets are located. In other words, how is your nest egg divided across tax-free retirement accounts and good, old-fashioned taxable brokerage accounts?

Let's start with some basics, then we can get more specific.

If you're in your early 60s and able to take advantage of the super catch-up contributions, you might still have decades left to live a quality life. But a reality check is needed here. It took you an entire working career to build your nest egg. If you were to take heavy losses in your portfolio at this stage, you might not have time to make it back.

You want to make sure you're not taking excessive risk.

The old financial planning general rule is that your stock exposure should be roughly 100 minus your age. Given that Americans are living longer today (and that returns on competing investments like bonds and cash are lower than they were in past decades), many financial planners have revised that rule to 120 minus your age. Using both as a range, a 63-year-old American should have roughly 37% to 57% in stocks.

Remember, these are rules of thumb, not iron-clad fundamental laws of the universe. You might be comfortable going higher than that, particularly if you have guaranteed income from a pension or if your portfolio is large and able to withstand a significant bear market. But for most savers, a little caution is likely warranted.

In other words, you should treat your additional catch-up contributions the way you treat the rest of your portfolio: investing them in a moderately aggressive portfolio primarily allocated to low-cost stock and bond index funds. A target-date fund that aligns with your age or expected retirement date would also be a perfectly reasonable option.

Let's say your retirement planning is on track, your portfolio is appropriately allocated for your risk tolerance, and you don't really "need" the super catch-up contributions to meet your goals. You're viewing them as a bonus … something akin to "play money."

In that case, have some fun with it. If your plan allows it, you could consider buying individual stocks. Once your basic financial needs are met, it's perfectly fine to get aggressive with a small portion of your portfolio, such as the super catch-up contributions.

Don't forget about taxes

We briefly touched on asset allocation earlier, and that's worth revisiting here. If you're like most savers, your nest egg is spread across a mixture of traditional retirement accounts, Roth accounts and taxable brokerage accounts.

Not all investments are taxed the same. Stocks or stock funds held for the long term aren't taxable until you sell them, and even then, they'll generally benefit from lower long-term capital gains tax rates. Stocks paying qualified dividends also benefit from lower rates, whereas gains from short-term trading and interest tend to get taxed at higher rates.

Keep all this in mind as you top up your 401(k) with the additional catch-up contributions. To the extent you can, try to put tax-inefficient investments such as bonds or actively managed stock funds into your retirement account and save the tax-efficient investments, including stock index funds and qualified dividend stocks, for your taxable accounts.

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Another encouraging inflation reading and a positive session for several mega-cap stocks lifted the broad market Wednesday. A solid round of earnings reports also boosted sentiment, though gains were capped by a down day for chip stocks.

Ahead of the open, the Bureau of Labor Statistics (BLS) said the Producer Price Index (PPI), which measures what businesses pay suppliers for goods, fell 0.3% from May to June. Year over year, wholesale prices were up 5.5%.

"Nearly two-thirds of the June decline in the index for final demand goods can be traced to prices for gasoline, which dropped 12.0 percent," the BLS said.

Core PPI, which excludes volatile food and energy prices, rose 0.2% month over month and 5.1% year over year.

The inflation readings came in better than economists expected, while Wall Street also welcomed downward revisions to the PPI for both April and May.

"The PPI report's largest new piece of information is its downward revisions to inflation in the last few months," says Bill Adams, chief U.S. economist at Fifth Third Commercial Bank.

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While Adams believes the cool inflation readings, also seen in the June CPI report, will keep the Federal Reserve on hold when it meets in two weeks, he notes that "it's hard to feel too excited about last month's drop in producer prices, which largely reflected lower energy prices — prices which rebounded in the first half of July as energy traffic through the Strait of Hormuz slowed."

Nevertheless, the blue-chip Dow Jones Industrial Average added 0.3% to 52,658 today, while the broader S&P 500 (+0.4% at 7,572) and tech-heavy Nasdaq Composite (+0.6% at 26,269) closed higher too.

Mega caps rise, but chip stocks struggle

Big gains in several mega-cap stocks helped buoy the main indexes today, with Amazon.com (AMZN, +3.0%), Apple (AAPL, +4.0%), Microsoft (MSFT, +2.8%) and Alphabet (GOOGL, +3.2%) all closing higher.

But the day's upside was contained by another negative session for several semiconductor stocks. Micron Technology (MU), for one, dropped 8.0% and is now down 22% since the start of July. Sandisk (SNDK) fell 8.1% today and is off 29% month to date.

BlackRock pops on earnings, Conagra falls on dividend cut

Over on the earnings calendar, BlackRock (BLK) jumped 6.6% after the asset management firm reported better-than-expected second-quarter earnings. Additionally, BLK became the first investment company to have assets under management top $15 trillion.

Conagra Brands (CAG), on the other hand, fell 0.4% after the Duncan Hines parent swung to a net loss in its second quarter. On an adjusted basis, CAG beat analysts' per-share earnings estimate, though revenue fell short.

The company also halved its dividend. "Resetting our dividend to an annualized rate of $0.70 per share proactively realigns our capital allocation, accelerates progress toward our leverage target, supports critical investments, and strengthens our financial flexibility, including the ability to shape the portfolio over time," said CEO John Brase, who stepped into the position in early June.

Today's decline is only more of the same for the struggling consumer staples stock, which is down 30% since mid-February.

PayPal has its best day ever

PayPal Holdings (PYPL) was also in focus Wednesday, with shares jumping 17.2% — their biggest one-day gain since the payments processor was spun off from eBay (EBAY, +0.2%) in 2015.

Boosting the financial stock were reports that financial services platform Stripe and private equity firm Advent International offered to buy PayPal for $53 billion, or $60.50 per PYPL share — a nearly 28% premium to its July 14 close.

PYPL has struggled in recent years and is down more than 80% from its all-time high near $310 in 2021.

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President Donald Trump rolled back his 20% toll on Strait of Hormuz shipping, though an off-and-on ceasefire in the Middle East continues to roil energy markets and interest rates. But consumer inflation was a lot cooler than expected in June, big banks beat Wall Street forecasts and even conflicting headlines suggest interest in the AI trade remains high.

The West Texas Intermediate crude oil futures contract traded above $80 per barrel for the first time since June 17 and was higher by 2.0% at $79.68 on Tuesday. The 2-year Treasury yield ticked down to 4.189% after reaching a new 52-week high and closing at 4.263% on Monday.

The Bureau of Labor Statistics (BLS) said before the opening bell that the Consumer Price Index (CPI) showed its biggest month-over-month decline since 2020 last month. The June CPI report attributed the move to the steepest slide for gasoline prices since 2022.

Bloomberg, relying on "people familiar with the matter," said South Korea-based Samsung Electronics plans to seek some of the same fortune SK Hynix (SKHY, -9.3%) found last Friday when it completed one of the biggest IPOs in U.S. history.

But Reuters quoted a company spokesperson: "Samsung Electronics is not reviewing ​the possibility of issuing American Depositary ​Receipts." Samsung was up 3.4% on its local exchange, and the Korea Composite Stock Price Index was up 0.7% on Tuesday.

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Meanwhile, facing an array of challenges to his authority, new Fed Chair Kevin Warsh is testifying to Congress for the first time since taking his oath of office in May.

Warsh appeared before the House Financial Services Committee today and will testify to the Senate Banking Committee tomorrow about inflation and interest rates.

As Louis Navellier of Navellier & Associates notes, the BLS will release the Producer Price Index (PPI) before the opening bell on Wednesday. "Economists are expecting the overall PPI to decline 0.2% in June," Navellier writes, "so it is widely expected that inflation will also be cooling on the wholesale level."

At the closing bell on Tuesday, the tech-heavy Nasdaq Composite was up 0.9% to 26,107, the broad-based S&P 500 had climbed 0.4% to 7,543, and the blue-chip Dow Jones Industrial Average was higher by 0.02% to 52,508.

GS gets the biggest earnings bounce

Goldman Sachs (GS, +9.1%) was the top-performing Dow Jones stock on Tuesday after management of the heaviest component in the price-weighted index reported expectations-beating second-quarter revenue and earnings.

JPMorgan Chase (JPM, +2.5%) and Bank of America (BAC, +1.9%) also beat Wall Street forecasts and rose.

But Citigroup (C, -5.3%) and Wells Fargo (WFC, -2.5%) exceeded estimates and fell.

C opened higher, but CEO Jane Fraser said during the company's intraday conference call that management is planning additional investments, as well as accelerated job cuts, that could lead to higher costs in the short term.

Wells Fargo, meanwhile, continues to recover after the removal of regulatory restrictions on its asset growth.

Another Black Tuesday for Big Blue

International Business Machines (IBM, -25.2%), which was founded in June 1911 and completed its initial public offering (IPO) in January 1962, had its worst trading day since at least 1968 on Tuesday.

IBM closed with its biggest single-day loss on record, exceeding the 23.7% decline on Black Tuesday, October 19, 1987, after CEO Arvind Krishna said in a letter to shareholders that Big Blue would miss its second-quarter revenue and earnings guidance.

Susquehanna analyst Jamie Friedman reiterated his Neutral (Hold) rating and his $303 12-month target price, citing IBM's quantum computing option. "At the same time," the analyst added, "the other dimensions of the business that comprise the vast majority of revenue are meeting headwinds."

IBM is scheduled to report earnings on July 23.

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President Donald Trump re-imposed a U.S. blockade on Iran and introduced a 20% toll on all cargo transiting the Strait of Hormuz, adding to uncertainty at the key passage to and from the Persian Gulf. At the same time, another steep sell-off for South Korea-based semiconductor stocks undermined "risk on" sentiment stateside.

"All other countries will have fair and open use of the Strait. The U.S.A. will be, from this point forward, known as 'THE GUARDIAN OF THE HORMUZ STRAIT,'” the president posted on Truth Social, "but as such, and as a matter of FAIRNESS, will be reimbursed, at the rate of 20% on all cargo shipped, for any and all costs necessary to do the job of providing safety and security to this very volatile section of the World."

The front-month West Texas Intermediate crude oil futures contract was up 8.8% to $77.72 per barrel. The 2-year Treasury yield ticked up to 4.269% from 4.208% on Friday and reached a new 52-week high.

Meanwhile, the Korea Composite Stock Price Index dropped 9.0% on Monday. The KOSPI recently traded into "bear market" territory by declining 20.5% from its record closing high on June 22 through last Wednesday's close.

"The stock market's attempt to break out of its six-week consolidation faces a couple of familiar challenges—tech volatility and geopolitics," E*TRADE from Morgan Stanley managing director Chris Larkin observes. "The ongoing swings in semiconductors has made it difficult for tech to mount a sustained push to the upside, and while the market has so far taken the breakdown of the US-Iran ceasefire in stride, escalating hostilities and rising oil prices won't help the bullish cause."

Larkin notes that investors, traders and speculators expect incoming consumer and producer inflation data to show some cooling. "But," he adds, "the market may not get as much of a boost from good news if traders think oil is headed higher again."

Big Tuesday

Indeed, this week's economic calendar, Tuesday morning in particular, is all about inflation and interest rates.

The Bureau of Labor Statistics (BLS) will release the June Consumer Price Index (CPI) report at 8:30 a.m. Eastern Standard Time. That's less than two hours before new Federal Reserve Chair Kevin Warsh makes his first appearance before Congress as mandated by the Federal Reserve Act.

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The act requires the Fed chair to appear twice a year to talk about the central bank's Semiannual Monetary Policy Report. Warsh is scheduled to testify before the House Financial Services Committee on Tuesday and at the Senate Banking Committee on Wednesday.

Tuesday is also a big day on the earnings calendar, with Bank of America (BAC, -0.2%), Citigroup (C, -0.1%), Goldman Sachs (GS, -0.8%), JPMorgan Chase (JPM, -0.6%) and Wells Fargo (WFC, +0.6%) scheduled to report second-quarter results and offer forward-looking guidance before the opening bell.

SKHY vs AAPL

SK Hynix (SKHY, -9.3%) was down 15.4% during the first trading session on its local exchange after it completed one of the biggest IPOs in U.S. history on Friday. SK Hynix and fellow chipmaker Samsung Electronics, which was down 10.7% on Monday, make up about 51% to 53% of the KOSPI.

The iShares Semiconductor ETF (SOXX, -4.8%) posted a more modest loss, though Nvidia (NVDA, -3.5%) was the worst-performing Dow Jones stock.

Apple (AAPL, +0.6%) traded against Monday's trend for both the Magnificent 7 stocks and tech generally, touching a new all-time high even as the Roundhill Magnificent 7 ETF (MAGS, -1.0%) was well in the red.

Citi Research analyst Asiya Merchant reiterated her Buy rating and raised her 12-month target price for AAPL from $315 to $365, citing the September release of the iPhone 18 as "an important catalyst that could further strengthen investor sentiment." The iPhone 18 is expected to include Siri AI.

At the closing bell on Monday, the tech-heavy Nasdaq Composite was down 1.6% at 25,873 the broad-based S&P 500 had shed 0.8% at 7,515, and the blue-chip Dow Jones Industrial Average was off 0.3% at 52,498.

When FAST is also safe

If there is such a thing as a safe stock, Fastenal (FAST, +1.2%) qualifies according to Kiplinger's Personal Finance Magazine contributing columnist James Glassman. As Glassman notes, the wholesale nuts and bolts distributor has boosted its dividend for 26 straight years, and it has a beta of 0.88. So it's a "Dividend Aristocrat," and it's less volatile than the broader market.

FAST, which is also scheduled to report earnings before the opening bell on Tuesday, generated a year-to-date total return of 17.1% through July 10 vs 11.4% for the S&P 500. The industrial stock is also up 94.1% and 451.8% over the trailing five- and 10-year periods vs 85.7% and 316.3% for the index.

The Wall Street analyst community is split on FAST: Five Buy, seven Hold and five Sell ratings. But Rothschild & Co. Redburn sees something different here, too.

"An investor who committed $9,000 to purchase 1,000 shares at Fastenal’s IPO in 1987 would today hold shares worth approximately $15.5 million," analyst William Blunt writes in the March 2026 Redburn Review (pdf), "equating to a compounded annual return of 21.6%, or 22.2% after reinvesting dividends."

Blunt says the culture established by founder Bob Kierlin, who was CEO for 35 years, is built on frugality. "This disciplined approach to costs has enabled sustained reinvestment," he adds, "reinforcing a virtuous cycle of profitability and expansion."

On Monday, Rothschild Redburn initiated coverage of FAST with a Buy rating and a $55 12-month target price.

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Markets ended the first full trading week of July on a positive note, with all three main equity indexes posting gains on Friday. Investors, traders and speculators welcomed another hot initial public offering (IPO) as they look forward to the acceleration of earnings reporting season and new Fed Chair Kevin Warsh's first testimony on Capitol Hill since taking over at the world's most important central bank.

Materials stocks took the lead on Friday, as 10 of 11 sectors closed in the green. Tech stocks were higher, too, while Nvidia (NVDA, +4.0%) and Nike (NKE, +3.8%) were the top-performing Dow Jones stocks.

SK Hynix (SKHYV, +17.0%) started trading late in the morning and immediately popped to an intraday of $176.34, 18.3% above its IPO price. After raising $26.5 billion this week, SK Hynix now ranks among the biggest IPOs in U.S. history.

Financial stocks added more than 1%, with Bank of America (BAC, +0.7%), Citigroup (C, +0.7%), Goldman Sachs (GS, -0.1%), JPMorgan Chase (JPM, +0.3%) and Wells Fargo (WFC, +0.2%) scheduled to report second-quarter earnings before the opening bell next Tuesday.

By the closing bell, the Nasdaq Composite had added 0.3% to 26,281, finishing with a 1.7% weekly gain. The broad-based S&P 500 rose 0.4% on Friday and 1.2% for the week to 7,575. The blue-chip Dow Jones Industrial Average ticked up 0.3% to 52,673 but tracked back 0.5% over the five days.

What will Warsh tell Congress?

As Louis Navellier of Navellier & Associates foreshadows, next week is a big one for the earnings calendar: "We are locked and loaded for another earnings announcement season," Navellier writes, noting that valuations for "fundamentally superior stocks" are being compressed.

It's also a big one for the economic calendar: "I think it is safe to say that Fed Chairman Warsh is planning to turn the Fed inside out, streamline it and make it operate more efficiently," Navellier writes.

Warsh is scheduled to testify before the House Financial Services Committee on Tuesday and at the Senate Banking Committee on Wednesday.

As Navellier explains, Warsh is putting together five task forces to "re-examine how the central bank operates." The task forces will focus on AI, productivity and jobs; Fed communications; the Fed’s balance sheet, inflation and economic data.

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The front-month West Texas Intermediate crude oil futures contract was down 1.3% to $71.56 per barrel. WTI ticked up 4.2% this week, though markets' main concerns right now are top- and bottom-line growth and forward guidance.

At the same time, markets want to know from Warsh how the Fed will respond amid continuing uncertainty about energy prices, inflation and interest rates.

Note that the Bureau of Labor Statistics (BLS) will release the June Consumer Price Index (CPI) report less than two hours before Warsh testifies on Tuesday.

Upside for META stock

Meta Platforms (META, +6.2%) led S&P 500 stocks on Friday, as the Facebook and Instagram parent surged amid reports that it plans to enter the cloud computing market using its excess AI capacity and that it wants to build a new AI chip in partnership with Broadcom (AVGO, -0.3%).

Broadcom, which is not one of the Magnificent 7 stocks but is one of the top 10 companies in the world based on market cap, was up 11% this week, helped by confirmation by Apple (AAPL, -0.3%) that it will spend $30 billion for its own U.S.-made chips.

"Meta has been a significant beneficiary from the advances in AI by selling more ads at higher prices, which has driven significant revenue acceleration,” DA Davidson analyst Gil Luria observes. "It has not gotten credit because it has increased capex even more. If Meta slows down capex and starts monetizing it, we see significant upside to revenue and cash flow."

WD-40 stock was up 11% today

WD-40 (WDFC, +10.7%) made the case for mid-cap stocks on Friday, as management of the multiuse petroleum-based spray maker beat Wall Street expectations for its third quarter and raised guidance for the full year.

"We delivered an exceptional third quarter," CEO Steve Brass said in WD-40's earnings announcement (pdf), "with net sales increasing 24% and operating income increasing 47%, demonstrating the operating leverage inherent in our business model." Brass cited double-digit growth across WD-40's businesses, as well as "continued progress" in its "Must-Win Battles."

"While the cost backdrop remains fluid," a team of William Blair analysts led by Jon Andersen writes in a post-report note, "we believe in our thesis that WD-40 represents a singular and attractive business and investment opportunity."

Andersen & Co. reiterated their Overweight (Buy) rating, noting WD-40's "unique heritage, brand equity and product efficacy, geographic and channel reach, and go-to-market capabilities," as well as "superior organic sales growth" and "reliable free cash flow generation."

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Wednesday's late surge for a mixed close evolved into Thursday's across-the-board rally for the main U.S. equity indexes after a major gauge of global risk appetite recovered from another steep sell-off. Big companies are still making huge commitments to artificial intelligence, and stocks are still trending higher ahead of a summer reporting season that's going to heat up next week.

The front-month West Texas Intermediate crude oil futures contract was down 2.3% to $71.85 per barrel, even as the U.S. and Iran continue to attack targets around the Strait of Hormuz.

And tech stocks took off again, as the Korea Composite Stock Price Index added 0.6% a day after it slid into bear market territory. The KOSPI was down 20.5% from its record closing high of 9,114 on June 22 through Wednesday's close at 7,246.

The KOSPI recovered from a steeper 20% drawdown over two trading days in March and got back above its previous all-time high by April. Then, on June 23, it was down 10%, a day they've called "Black Tuesday" in South Korea.

Earnings are the underlying force

Financial stocks added more than 1%, with Bank of America (BAC, +1.6%), Citigroup (C, +1.6%), Goldman Sachs (GS, +2.6%), JPMorgan Chase (JPM, +1.5%) and Wells Fargo (WFC, +1.6%) scheduled to report second-quarter earnings before the opening bell next Tuesday.

Consumer staples and energy stocks suffered amid the resumption of the "risk on" AI trade, the sectors shedding 1.8% and 1.6%, respectively, with notable names Procter & Gamble (PG, -1.1%) and Chevron (CVX, -1.1%) among 17 of the 30 Dow Jones stocks in the red.

"Today’s rebound demonstrates that good stocks bounce," Louis Navellier of Navellier & Associates notes. Navellier is optimistic about the flow of second-quarter earnings next week: "Believe it or not, it's going to be better than the first quarter."

According to a FactSet summary of first-quarter results, 85% of S&P 500 stocks beat earnings-per-share estimates, and companies reported aggregate revenue and earnings growth rates of 11.6% and 28.4%

"We're in the bumpy summer months," Navellier concludes, "but the underlying force underneath this market is earnings and a very strong economic recovery."

By the closing bell, the tech-heavy Nasdaq Composite had risen 1.3% to 26,206, the broad-based S&P 500 was up 0.8% at 7,543, and the blue-chip Dow Jones Industrial Average had added 0.3% to 52,487.

SK Hynix U.S. IPO is 7 times oversubscribed

According to Bloomberg, which cited "people familiar with the matter," demand for U.S.-listed shares of South Korea-based memory chipmaker SK Hynix exceeds supply by more than seven times. As Wall Street would say, this initial public offering (IPO) is "oversubscribed."

Management of the semiconductor stock plans to price its American Depositary Receipt (ADR) at $149 per share. The ADR IPO price is 3.1% above SK Hynix's closing price in South Korea on Thursday.

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SK Hynix is expected to begin trading on the Nasdaq under the symbol SKHYV on Friday and will transition to the symbol SKHY on July 13. One SK Hynix ADR will be equivalent to one-tenth of a South Korea-listed common share.

At $26.5 billion, the SK Hynix IPO would be the biggest first-time share sale of a foreign stock in the U.S., surpassing the $25 billion Alibaba Group (BABA, +2.0%) raised in September 2014. That would put it among the biggest IPOs in U.S. history.

Micron ups US spend above $250 billion

Micron Technology (MU, 4.5%) said it will accelerate and increase its investment plan, committing to spend more than $250 billion through 2035 to support the memory chipmaker's goal to produce more than 40% of its DRAM in the U.S., citing "surging demand for memory in the AI area."

Micron also poured the first concrete at what will be the biggest semiconductor manufacturing facility in the U.S.

In a separate announcement, Micron said it would spend $3 billion to develop the semiconductor supply chain around its U.S. footprint.

BofA Global Research analyst Vivek Arya reiterated his Buy rating and a $1,550 12-month target price for MU stock, citing a 40% to 50% increase in Big Tech capex to $1.5 trillion in 2027. The analyst said memory will consume 35% to 40% of that budget.

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When IPO activity picks up, client calls tend to follow. A high-profile company goes public, the financial press lights up, and suddenly, clients who have never considered investing in an IPO are asking whether they should get in.

These conversations can be genuinely useful, but they can also go sideways quickly if advisers aren't prepared to manage expectations alongside the enthusiasm.

Having a clear framework for these conversations helps. Here's how I think about it.

1. Start with the fundamentals

Before getting into access or mechanics, it helps to anchor clients in why companies go public in the first place. While an IPO creates an investment opportunity for outside investors, it's primarily a capital-raising strategy.

The company needs funding to grow, pay down debt or give early investors and employees a path to liquidity. Going public is how they get it.

In exchange, the company accepts significant new obligations: Regular SEC reporting, public scrutiny from analysts and shareholders, plus ongoing regulatory oversight. These responsibilities shape how the offering is priced and who gets access first.

2. Walk clients through the process

Many investors have a vague sense of what an IPO is, but not a clear picture of how one comes together. Walking them through the basic mechanics sets up the risk conversation more naturally.

The company selects investment banks (underwriters) to manage the offering and determine pricing, share volume and allocation. Then, the company files a registration statement with the SEC, which includes a prospectus with financials, the business model and a detailed risk factors section.

Institutional investors get a first look during the "roadshow," where company leadership presents details about the IPO to build demand.

The offering price is finalized the night before trading begins and shares hit the market.

Educating investors on the process is important because your clients may assume IPO investing is as simple as clicking "buy" on their brokerage app. But most offerings aren't straightforward, and explaining why to your clients helps set the right expectations.

3. Clarify the three access points

When a client asks, "How do I get in on an IPO?" the honest answer is that it depends on when you want in and what you have access to. (I typically hate "it depends" answers, but it truly applies in this situation.)

There are three entry points, each with a meaningfully different profile:

Pre-IPO secondary markets. Before a company goes public, some shares may be available through secondary platforms, purchased from early employees or existing investors seeking liquidity.

This path is generally limited to accredited investors, involves limited disclosure and comes with transfer restrictions and higher operational complexity. Pricing can vary significantly from the IPO price, and fraud risk is elevated.

If a client is interested in this option, the channel matters enormously. Only established, regulated platforms with clear documentation of ownership and custodial arrangements should be considered.

IPO allocation. Participation in the actual offering, at the offer price, typically flows through broker-dealers that are part of the underwriting group. Institutional investors receive priority, and retail access can be limited.

In high-profile deals, demand often far exceeds available shares. Clients should understand that submitting interest isn't a commitment, and allocation isn't guaranteed.

Anyone promising guaranteed access to a hot IPO is waving a bright red flag.

Post-IPO trading. Once shares list on a public exchange, any investor can buy them through a standard brokerage account. This is the most accessible option and the one with the least operational complexity. It's also where most individual investors will land.

The trade-off is that newly public companies often see elevated volatility in the early weeks of trading as the market finds its footing.

We saw this in action with the SpaceX IPO earlier this year. The company's stock (SPCX) increased by more than 50% in the four days following its debut, then dropped back down around initial pricing in the subsequent two weeks.

4. Reframe the 'first-day pop' conversation

IPOs attract a lot of attention around first-day performance. A company opens 30% above its offer price, and it looks like a missed opportunity. If it drops 20% on day one, suddenly the whole asset class gets a side-eye.

Neither reaction is especially useful for long-term investors.

First-day price movements reflect a combination of limited float, pent-up retail demand and short-term sentiment, none of which are a reliable signal of where the company will be in three to five years.

Early enthusiasm has a way of fading once the lockup period expires and insiders can sell. Clients who buy in based on first-day momentum often find themselves holding a position they don't fully understand at a price that was set by very different market forces.

This is a good moment to bring the conversation back to fundamentals. Some good questions to ask:

• Does the client understand the company's business model?
• Have they looked at the prospectus, particularly the risk factors section?
• Does the offering fit within their time horizon, risk tolerance and overall portfolio composition?
• What percentage of their holdings would this represent, and are they comfortable with that level of concentration?

5. Tie it back to the plan

One of the most effective ways to manage IPO conversations is to redirect them toward your client's financial plan. An investment that generates a lot of headlines isn't automatically a good fit.

An IPO that most investors can't access at the offer price, carries meaningful volatility risk and represents a company with an unproven public track record deserves the same disciplined evaluation as anything else in the portfolio.

Access and hype are not the same thing as opportunity. Helping clients see the difference, and then evaluating each situation through the lens of their individual goals and risk profile, is exactly the kind of value a good adviser provides.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Investors, traders and speculators faced fresh headwinds from Asia on Wednesday. President Donald Trump said the U.S. is "probably" going to launch additional attacks on Iran to retaliate for Islamic Revolutionary Guard strikes on three commercial tankers as they transited the Strait of Hormuz on Tuesday.

"I'll give them a little warning," Trump said from the sidelines of the NATO summit in Ankara, Turkey. "We're going to hit them hard tonight, but we'll see how it all works out."

The front-month West Texas Intermediate crude oil futures contract was up 5.2% to $74.09 per barrel after the president also threatened to reimpose a naval blockade at the key chokepoint for the global hydrocarbon market, but only for Iran.

"Look for cooler heads to prevail in coming days, with traffic returning to the Strait of Hormuz and Iran and the U.S. returning to the negotiating table," Mizuho Securities Director of Energy Futures Bob Yawger forecast.

Yawger expects negotiations to "drag on" over the next two months, "with both sides eventually agreeing on a weak deal that does not remove Iran's enriched uranium and possibly allows the Iranians to 'manage' the Strait of Hormuz."

Nvidia (NVDA, +3.7%), the leader of the AI revolution and the biggest company in the world based on market cap, trended higher through the day after gapping down at the opening bell.

The Nasdaq Composite rallied off its intraday low, and by the closing bell the tech-heavy index was up 0.2% at 25,870. But the broader S&P 500 declined 0.3% to 7,482, and the blue-chip Dow Jones Industrial Average fell 1.1% to 52,348.

Buffett's Berkshire portfolio gets an energy boost

Integrated oil and gas supermajor Chevron (CVX, +1.1%), which offers all of upstream (exploration and production), midstream (storage and transportation) and downstream (refining and retail) energy exposure, led the 30 Dow Jones stocks for much of Wednesday's trading session.

But Occidental Petroleum (OXY, +3.7%), one of the biggest North American E&P outfits, enjoyed a bigger bounce from renewed tension in the Middle East.

New Berkshire Hathaway (BRK.B, -1.8%) CEO Greg Abel sold CVX during the first quarter. But he held OXY in what is still basically Warren Buffett's stock portfolio.

Abel also engineered Berkshire's $9.7 billion acquisition of Occidental's chemical business that closed in January, and Berkshire remains the largest holder of the energy stock, with more than a quarter of OXY's outstanding shares.

Apple and Broadcom revive the tech trade

Chipmakers Samsung Electronics and SK Hynix led the Korea Composite Stock Price Index into "bear market" territory, broadly defined as a 20% decline from a recent all-time high.

The KOSPI reached its record closing high of 9,114 on June 22, but a 5.4% slide on Wednesday following Tuesday's 4.9% sell-off left it 20.5% below that peak at 7,246. Samsung was down 6.3%, SK Hynix 5.7%. The latter will start trading in the U.S. on Friday under the symbol SKHY.

Selling pressure on tech stocks generally eased with confirmation from Apple (AAPL, +0.9%) of a new silicon deal with Broadcom (AVGO, +4.8%) that extends their longstanding relationship into 2031.

The iPhone maker added meat to the bone by confirming a commitment of at least $30 billion "to design and produce custom silicon components and cutting-edge wireless connectivity technologies for a wide range of Apple products."

Take a few seconds to read the FOMC minutes

Like the policy statement summarizing the FOMC's most recent decision to hold the target range for the federal funds rate at 3.50% to 3.75%, the minutes from the June Fed meeting were a lot shorter than they used to be, by about 22% based on a crude word-count comparison.

This "communication breakdown" is actually a big part of the "regime change" promised by new Fed Chair Kevin Warsh.

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Warsh described a "family fight" about interest rates and the trajectory of inflation during his post-meeting press conference, and the minutes reveal a central bank still making decisions based on incoming data.

Brevity is catching on, though: "A number of participants noted that it was an opportune time to consider significant changes to the FOMC’s postmeeting statement," the June FOMC minutes reveal. "A majority of participants remarked that they saw advantages in shortening the statement."

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In October 2024, the Harris Poll asked Americans about pets and kids: "If you had to choose, which would you prefer in the future?" Of the 2,125 respondents, 18% said children, 43% said pets, and the rest said both. Harris also found that a majority of Gen Z pet owners would give up a year of their own lives if it would add a year to their pet's life.

In case you hadn't noticed, Americans have gone ga-ga over their pets. Some two-thirds of households own at least one, and, according to the Federal Reserve Bank of St. Louis, total spending on "pets, pet products and related services" reached $188 billion in 2024 (the latest data), up from just $40 billion in 2000. Pet ownership has been building since about 1990, but it rose sharply during the COVID era, with pets providing stay-at-home singles and families with companionship; 78% of Americans bought a pet during the pandemic.

Savvy investors profited from the pet boom. In 2020, the worst COVID year, ProShares Pet Care (PAWZ), an exchange-traded fund, returned 61.4%, more than triple the rate of the S&P 500 index. Anything related to pets soared. A company that sells fashionable leashes and collars called Dogness (International) — yes, in parentheses — jumped from $21 on October 1, 2020, to $175 just 15 months later. Freshpet, which makes meals and treats that are "thoughtfully crafted for your best friend," roughly tripled from the beginning of April 2020 through the end of April 2021.

Then, as these things often do, the pet boom imploded. Within six months of its peak, Dogness had fallen 80%. It now trades slightly over one dollar per share with a market capitalization (shares outstanding times price) of just $15 million. Freshpet today is down more than two-thirds. (Stocks and funds I like are in bold; prices and other data are through May 31 unless otherwise noted.)

Straight from the source

Americans still love their pets, and ownership keeps rising — as my brother and my nephew, both veterinarians, can confirm. So what happened? First, competition has taken a bite out of profit margins. Amazon.com has become a pet-care giant, crowding out smaller purveyors, or at least squeezing their revenues.

Second, middle-class Americans have become strapped for disposable cash. Households are currently spending an average of $6,000 a year on their pets, and those are incremental dollars on top of what's needed to buy such items as their own food.

It seems to me, however, that pet stocks have fallen so much that they are offering opportunities for wise investors. Many have become classic value stocks: Good businesses with decent growth that are unappreciated.

Start with Chewy (CHWY), the e-commerce pet supplier that was spun off from the PetSmart chain (now private) in 2019. Since then, despite competition from Amazon, sales have tripled, and earnings have risen consistently. But the stock is down 70% over the past five years and now has a price-earnings ratio, based on estimated earnings for the year ahead, of just 14, compared with 22 for the average S&P 500 stock.

More Chihuahuas than Great Danes

Publicly traded pet stocks tend to be small (even Chewy has a market cap of just $9 billion), but there are exceptions. Zoetis (ZTS), which was spun off from Pfizer in 2013 and makes medicines, vaccines and diagnostics for pets and livestock, has a market cap of $33 billion.

Shares dropped more than 20% in early May when Wall Street was disappointed with Zoetis's first-quarter earnings, which rose only 6% compared with the same quarter a year ago. The company stated: "Pet owners demonstrated increased price sensitivity, resulting in a decline in veterinary visits and softer demand for premium innovative products, where Zoetis leads. At the same time, competition intensified across key pet care categories." That's a good description of the challenges that practically all pet-care stocks face.

With the tumble, Zoetis carries a P/E of just 11. And it's hard to argue with any stock whose profits have risen every year for the past decade — what I call a beautiful line. Zoetis also has a strong balance sheet, an impressive profit margin and a dividend yield of 2.7%. It's down by two-thirds since its 2021 high.

One of my favorites in the same sector is IDEXX Laboratories (IDXX), with a $44 billion market cap. IDEXX provides diagnostic instruments, software and lab testing for vets. Earnings were up year-over-year by 17% in the most recent quarter, but, unlike most pet-care stocks, IDEXX is not cheap, with a forward P/E of 38. Shares have been flat over the past five years after dropping — for no good reason in my opinion — by about one-fourth since November.

Another worthy pet pharma company is Elanco Animal Health (ELAN), with popular products to fight fleas and ticks. The stock, with a market cap of $12 billion, is up by 76% in the past year, but it's still far from its 2021 high. I also like Philbro Animal Health (PAHC), which reported earnings in the quarter ended March 31 that were up 15% over the same period last year. Philbro sells products that prevent and treat diseases in companion animals and livestock in 95 countries. Shares are up 30% in the past 12 months, but the P/E is just 10.

Veterinary expenses have risen sharply. A dog's broken leg can cost from $2,000 to $5,000 or more to set. So more and more owners have turned to pet insurance. The number of insured dogs and cats has doubled in four years, but market penetration is still low — just 4%, compared with 20% in Germany and 25% in the U.K. It appears there is room to grow.

Most of the top U.S. pet insurers are large multiline companies like Nationwide and Chubb, but the best pure play, Trupanion (TRUP), is number one in market share. The company is popular with vets because of its software platform, which makes reimbursement fast and easy. But it's another victim of the petpocalypse. Despite revenues nearly tripling between 2020 and 2025, the stock has dropped 75% in five years.

A big obstacle for investors is that many of the largest pet companies are either private or part of a more diversified business. For example, numbers one and two in dog food are the consumer-products giant Nestlé (Friskies, among many other brands) and the family-owned candy company Mars (Pedigree, the number-one dog food brand). Specialized dog food sellers such as The Farmer's Dog haven't gone public. Merck is a major provider of veterinary pharmaceuticals, but they represent no more than 10% of Merck's total sales. Covetrus, a much-admired animal health services company, is owned by a private-equity firm, as are thousands of veterinary practices.

The ProShares ETF mentioned above, with an expense ratio of 0.5%, is the best bet among pet funds. Its top four holdings are IDEXX, Zoetis, Freshpet and Chewy, accounting for almost 40% of assets. But the portfolio also includes Merck, Nestlé and even CVS Group, all of whose pet-related revenues are minor. Its five-year return is a negative 8.7%.

Facts like these, however, are a contrarian investor's dream. Pets are loved, but pet stocks are so hated that they are crying out for you to buy them — kind of like your dog mewling for his kibble.

James K. Glassman chairs Glassman Advisory, a public-affairs consulting firm. He does not write about his clients. His most recent book is Safety Net: The Strategy for De-Risking Your Investments in a Time of Turbulence. He owns none of the securities listed here. You can reach him at JKGlassman@gmail.com.

Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.

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Crude oil prices spiked and equity futures sagged after Iran opened fire on ships transiting the Strait of Hormuz and an Asia-based AI stock sold off before the opening bell on Tuesday.

The main equity indexes moved up from their respective intraday lows during a typically light-volume summer session. But investors, traders and speculators remain wary on the cusp of yet another critical earnings season.

The front-month West Texas Intermediate crude oil futures contract was up 4.8% to $71.82 per barrel amid an uptick in attacks on tankers moving oil and gas from the Middle East to global markets.

Price action for the iShares Semiconductor ETF (SOXX, -5.1%) once again reflected unease about how far and how fast the AI revolution has progressed and, beyond promise, the long-term prospects for real profits.

By the closing bell, the tech-heavy Nasdaq Composite was down 1.2% at 25,818, the broad-based S&P 500 had shed 0.5% to 7,503, and the blue-chip Dow Jones Industrial Average was off 0.3% at 52,924.

Why Samsung sank

Samsung Electronics was down 6.9% in South Korea after management of the semiconductor stock said in its preliminary report that revenue more than doubled and operating profit grew by 56% during the three months ended June 30.

Those are numbers that would make Nvidia (NVDA, +0.7%) proud. Indeed, Samsung stock has posted a year-to-date return of almost 150%, NVDA about 5%. And that's the rub right now.

"As is often the case," Trade Nation analyst David Morrison observes, "it can be better to travel than to arrive. And it seems that investors are concerned that semiconductor and other AI-adjacent stocks may struggle to maintain such high levels of sales and margins going forward."

SK Hynix, another South Korea-based chipmaker, was down 6.1%. SK Hynix, which is up more than 270% so far in 2026, is on track to begin trading as an American Depositary Receipt under the symbol SKHY on the Nasdaq as soon as the opening bell on Friday.

The Korea Composite Stock Price Index fell 4.9% on Tuesday. Samsung and SK Hynix account for almost 55% of the KOSPI, which has generated a year-to-date return of 81.7%.

CAT got the Dow

Caterpillar (CAT, -3.1%) was the worst-performing Dow Jones stock on Tuesday, a big deal because at north of $900 it's the second-biggest component in the price-weighted index.

Caterpillar announced the acquisition of Skywatch, which gathers and processes data for the mining industry. But, according to Barron's, the problem here is a downgrade for Germany-based Siemens Energy (SMERY, -5.1%).

Barclays analyst Vladimir Sergievskii cut his rating on the electrical equipment maker from Equal Weight (Hold) to Underweight (Sell), citing valuation concerns and the trajectory of the capex boom to support AI infrastructure.

At the same time, Sergievskii raised his 12-month target price from €110 to €130. Still, electric power specialist GE Vernova (GEV, -6.5%) sold off hard, too.

Great expectations

PepsiCo (PEP, +1.2%) and Delta Air Lines (DAL, -3.3%) are big, well-known companies that will share important information about how people are spending their money when they take their respective before-the-opening-bell turns on the earnings calendar Thursday and Friday. Markets will take particular note of what they say about the impact of inflation as participants evaluate the near-term future for the beverage and passenger airline industries.

Indeed, as FactSet Senior Earnings Analyst John Butters notes, Wall Street trimmed its earnings-per-share estimate for consumer staples stocks by 2.5% and for industrials by 2.1% amid an energy shock during the second quarter.

So their bar isn't as high as it is for high-flying tech stocks such as Samsung. But it is elevated right now, for the whole market: Analysts raised their aggregate EPS estimate for the S&P 500 by 3.4% from April 1 through June 30.

"In a typical quarter," Butters explains, "analysts usually reduce earnings estimates." The average EPS revision over the last five years is a decline of 2.7%. So consumer staples and industrial stocks are sort of outperforming here.

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"In fact," Butters adds, "this quarter marked the largest increase in the bottom-up EPS estimate during a quarter since Q2 2021 (+7.7%)."

Energy stocks saw the biggest EPS increase, 61.5%, followed by information technology at 8.7%. But Wall Street cut its EPS estimate for healthcare stocks by 15.8%.

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Refreshed optimism about the AI trade after a long holiday weekend and an intraday rally for a beleaguered American icon lifted all three main equity indexes into the green on Monday. Price action during another low-volume trading session reflected shorter-term catalysts and longer-term trends, as well as more evidence of a resilient U.S. economy.

The iShares Semiconductor ETF (SOXX, +2.7%) bounced back from a two-day decline of nearly 10%, as investors, traders and speculators bought the dip on the stocks building the backbone for the artificial intelligence (AI) economy.

Advanced Micro Devices (AMD, +6.6%) was among the top-performing S&P 500 stocks after Goldman Sachs analysts reiterated their Buy rating and raised their 12-month target price for the chipmaker from $450 to $640.

Broadcom (AVGO, +3.7%) was higher, too, on the extension of its agreement to supply Apple (AAPL, +1.3%) with custom chips through 2031.

Nike (NKE, -1.7%) was the worst-performing Dow Jones stock for much of Monday morning after Bank of America analyst Lorraine Hutchinson cut her 12-month target price for the iconic shoemaker from $55 to $47.

Nike bounced off its intraday low, though, and helped lift Papa Dow into the green by the closing bell.

"As always," Louis Navellier of Navellier & Associates writes, "we are locked and loaded for another earnings announcement season." As Navellier observes, the second quarter was the best-performing quarter for both the Nasdaq and the S&P 500 since 2020. "So expectations remain very high since economic growth is clearly accelerating."

At the closing bell, the tech-heavy Nasdaq Composite was up 1.1% at 26,121, and the broad-based S&P 500 had added 0.7% to 7,537. The blue-chip Dow Jones Industrial Average, meanwhile, rallied for a 0.3% gain to 53,055, crossing the 53,000 level for the first time and reaching another new all-time closing high.

Economic activity is still expanding

The Institute for Supply Management Services Purchasing Managers Index ticked down to 54.0 in June from 54.5 in May, but it remains well in expansion territory.

And, according to LPL Financial Chief Economist Jeffrey Roach, hiring for the World Cup in the U.S. likely contributed to the increase to the ISM Services Employment Index last month. Also, as the economist notes, input prices fell to their lowest since February, a sign that recent inflation pressures are unlikely to persist.

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"This morning’s ISM services Report on Business suggests the economic growth trajectory looks favorable," Roach explains. "As tariff and geopolitical stress abates, we should see further improvements with inflation dynamics, although not enough for the Fed to capitulate on its hawkishness."

The economist notes, too, that AI-related capex and consumer spending continue to support the broad economy.

SK Hynix gets a U.S. listing

Markets continue to digest the biggest initial public offering (IPO) in stock market history - indeed, SpaceX (SPCX, -1.0%) will join the Nasdaq 100 as of the opening bell on Tuesday.

Now, South Korea-based SK Hynix, will raise approximately $28 billion through an IPO of shares in the U.S.. With a market cap north of $1 trillion in U.S. dollar terms, SK Hynix is the second-biggest maker of memory semiconductors in the world.

SK Hynix told the SEC it will list 17.79 million common shares on the Nasdaq. The Wall Street Journal and Bloomberg reported that the semiconductor stock will begin trading on Friday under the symbol SKHY.

WING is a World Cup winner so far

Wingstop (WING, -4.2%) felt a lot of selling pressure on Monday, but the chicken wing flinger was up more than 15% from June 11, the day the tournament began, through July 2, validating its place among Wall Street's top World Cup stock picks.

At the same time, WING had generated year-to-date and trailing-12-month losses of more than 25% and 45%, respectively, making the recent move look like a short-term spike within a longer-term downtrend.

We'll see whether expansion of the customer base beyond sports fans extends past the tournament final on July 19. Wingstop management will report second-quarter results before the opening bell on Wednesday, July 29.

Of the 29 analysts covering the consumer discretionary stock who are tracked by S&P Global Market Intelligence, 24 say it's a Buy or Strong Buy, while four have it at Hold and one says Strong Sell. This works out to a high-conviction consensus Buy recommendation.

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You know the story. A boy keeps shouting that there's a wolf, nobody comes, and the one time a wolf actually shows up, he's on his own.

For the past several years, financial commentators have been pointing at market valuations and warning that stocks are expensive. And for the past several years, the market has largely ignored them and kept climbing.

Past performance may not indicate future returns, but it does skew our expectations. This is especially true right now, because the past 15 years have been incredible, favoring those who took on more risk than they may have realized.

After a while, you stop listening to the warnings. That's the dangerous part of the fable. The boy was wrong several times. But in the end, there was a wolf.

The data tells a story worth hearing

The Shiller P/E ratio (CAPE) divides the S&P 500's price by its average inflation-adjusted earnings over the prior 10 years. As of mid-2026, it sits at roughly 41, which is a level exceeded only by the dot-com peak.

Each dot in the chart above represents the S&P 500 on the first trading day of a given year, plotted against the real total return investors earned over the following decade. The pattern is clear: Every time valuations have reached these levels — 1929, 1966, 2000 — the subsequent decade delivered flat or negative real returns.

Not every time was a crash. But every time was a long, frustrating stretch of going nowhere.

I wrote about this pattern in my article Four Historical Patterns in the Markets for Investors to Know. Historically, the market has gone flat for 10 or more years roughly every 20 years or so. We're now 16 years from the last one.

Innovation is real: Bubbles are, too

To be clear, this isn't a call to sell everything and hide in cash. New technologies, such as the railroad, the automobile and the internet, created genuine, lasting economic value. AI will likely do the same.

The problem isn't the innovation. The problem is what happens when everyone wants in at the same time.

Railroads were revolutionary. The railroad bubble of the 1840s still wiped out investors. The internet changed the world. The Nasdaq still fell about 78% from 2000 to 2002. Good technology and bad timing can coexist.

The flip side is just as important

This chart tells the mirror story. At the end of every flat-market cycle — 1921, 1932, 1982, 2009 — valuations were depressed, and the subsequent decade rewarded patient investors handsomely.

This is one of the reasons I wrote my book, How to Retire on Time. I fear that too many people believe they can retire and use the same systems they have used for the past 15 years.

It's easy to retire when the markets only go up. It's a completely different story when the markets go flat.

If you consider that retirement may be 20 to 30 years, there's a good chance a part of your retirement could be during a flat-market cycle.

What that means in practice

It's not about trying to time each crash with active trading. It's not about riding the market up and down with your fingers crossed. It's about understanding price, recognizing when the market is offering a good deal and when it isn't and having a strategy that responds accordingly.

Patience is the foundation.

Beyond that, it means looking at tools that many investors overlook. Guaranteed income from an annuity can help stabilize your plan and portfolio, even if your stock portfolio doesn't perform (see the DIY Annuity Guide).

Bond funds may be making a comeback as an uncorrelated market to help stabilize your portfolio.

Real estate (not a stock of real estate companies, but something tied to actual real estate) can provide income and diversification that equities simply can't replicate.

It is important to take a step back as you approach retirement, or any new phase of life, and consider updating your plan. Perhaps it's time to diversify not just by asset class, but by markets and by strategies.

Here's the challenge: Many of these alternative strategies aren't readily available to retail investors through a standard brokerage account. That's one reason it may be worth sitting down with a fiduciary financial planner who can provide access to a broader set of tools, even if it's just a one-time engagement to build a plan you can execute yourself.

The wolf may or may not be at the door. But the shepherd who has a plan doesn't need to panic either way.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Let's think back to March 2020. Where were you, what were you doing, and what financial choices did you make?

Markets were hitting circuit breakers almost every other day for two weeks, and investment strategists, like me, were calling clients to ensure they weren't making irrational decisions while accounts were down substantially. It was a blur.

Yet, only about 60 days later, markets had recovered and were advancing. This monumental period served as a stark reminder that market volatility is an inherent and recurring feature of investing, not a one-time event.

In fact, market volatility has already defined the first half of 2026, stemming from global conflicts, persistent inflation and the Federal Reserve's shifting stance.

Given these challenging conditions, the question for every investor remains: How can we define and maintain a "healthy" portfolio designed to weather these turbulent times?

What makes a portfolio healthy?

First, a healthy portfolio is one built to deliver the returns necessary for your financial plan, while balancing liquidity with total return and combining income and market growth to keep your goals within reach.

Most importantly, a healthy portfolio is one that is fundamentally built around a long-term plan that short-term volatility cannot easily derail.

When coaching clients through market swings, I remind them that long-term portfolios are designed around their financial plans, and short-term dips of 5% to 10% don't change the likelihood of a plan's success.

Over the long run, market returns drive positive financial outcomes; it's critical not to react to short-term swings or social media noise.

We all need portfolio hygiene

This leads to the key to navigating volatile markets: Consistent, non-emotional maintenance. Or what I call "portfolio hygiene."

This is the essential practice of regularly checking in on your portfolio to ensure it continues to reflect the current reality of your financial life.

While it's tempting to obsess over current events during market turmoil, I recommend scheduling this check-up quarterly, regardless of the news.

For your own well-being and investment success, it is important not to overdo it; excessive monitoring during a downturn can become psychologically taxing and lead to impulsive decisions that actually could harm your portfolio.

In fact, one of the most common mistakes I see clients make during periods of volatility is trying to adjust their portfolio based on short-term, market-moving events that are, for better or worse, essentially coin-flip choices.

Take the conflict in Iran, for example: Oil is a hot topic. Some argue that oil has topped, and you should sell, while others contend that continued geopolitical risk could keep prices elevated, making energy assets a buy for the long haul.

Investors who act based on outcomes beyond their control can make knee-jerk decisions, especially in a fast-moving environment.

When is it time to apply some tweaks?

With this in mind, you may be thinking, "Surely I can't always sit tight." So, what are the key indicators that it is time to tweak a portfolio?

Simply put, if your life has changed, it is often time for your financial plans, and, therefore, your portfolio, to change as well. This includes major life-altering events like a marriage, the death of a family member or a new child joining your family. This is where portfolio management truly marries personal finance.

In addition to typical maintenance or life events, change may also be warranted for people with diversified portfolios who are comfortable being aggressive when others are afraid.

In times of market-dislocating risk, these investors can strategically reallocate their financial plan, bearing in mind the market's tendency to "stair-step up and elevator down."

These are the people who have been through volatility before, possess "calluses" when it comes to risk and know that a market dip can be a moment to capitalize.

No matter what, before making any change, especially when feeling pressure from market movements, every investor should ask themselves three simple questions:

• What is the desired outcome?
• Is there a follow-up or another decision to be made after making this change?
• Am I OK with the change not working?

These questions can be a start, but I sometimes advise my clients that the first thing to do when it comes to changing their portfolios during a volatile period is to not do anything. If you have an idea for an adjustment, stop, write it down and revisit it the next day.

Take the time to think about it and consult a trusted adviser or professional. Because if you remember one thing right now, it should be the importance of understanding your own behavioral and psychological biases, as they can cloud your judgment and worldview.

Separating those biases from portfolio decisions, along with having an asset allocation built to be nimble in times of opportunity, is a recipe for success in a turbulent market.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Retirement can turn the search for investment income into a delicate balancing act. A portfolio needs to generate enough cash to support withdrawals, but reaching too aggressively for yield can expose retirees to credit risk, price swings, dividend cuts or investments that fail to keep pace with inflation.

"It's essentially a trade-off between the income vs risk," says Roland Chow, financial planner and portfolio manager at Optura Advisors in Burlingame, California. A 10% distribution might look attractive on paper, but income is only useful if it's sustainable, tax-efficient and paired with a level of risk you can live with.

"The key is not to treat yield as the only objective," says Jason Bloom, head of Fixed Income ETF strategy for Invesco. "Higher income often comes with higher credit risk, greater price volatility or both, so retirees should focus on the durability of income and cash-flow planning rather than simply reaching for the highest yield available."

For retirees looking to increase portfolio income, the goal is to build a mix of investments that can support spending needs without taking unnecessary risks. Here are five ways to increase your income in retirement without throwing caution to the wind.

1. Dividend stocks

Dividend stocks can provide a one-two combo of current income and long-term growth potential. But finding the best dividend payers requires looking beyond the headline yield.

"Retirees evaluating dividend growth stocks should look to companies with moderate but consistently growing dividends," says Jason Fannon, a certified financial planner and senior partner of Cornerstone Financial Services in Southfield, Michigan. This can "signal financial health and a commitment to returning capital to shareholders."

He says to look for a dividend payout ratio below 60%, which suggests the dividend has room to grow.

Investors should also look beyond earnings. Free cash flow is a better metric to use because net income can be affected by non-cash accounting, according to Chow. As a general rule, he says "a stable or increasing free cash flow trend even while dividends are being raised is an excellent sign."

2. Real estate investment trusts (REITs)

REITs let you earn income from real estate without managing physical property. These companies own or finance income-producing real estate such as apartment buildings, shopping centers, healthcare facilities or data centers and trade like a normal stock.

Since REITs are required to distribute at least 90% of taxable income to shareholders, they generally provide higher yields than other stocks.

The trade-off is that REIT income is not risk-free. Fannon cautions that REITs can be cyclical and closely tied to broader real estate conditions. Interest rates can also impact returns: "Rising rates can increase borrowing costs and make them less attractive compared with other fixed-income securities."

REITs can also use leverage, which might amplify returns but also exacerbate losses, Chow adds. REIT income is typically taxed as ordinary income, so it doesn't receive the more favorable qualified dividends tax rate.

3. Municipal bonds

Municipal bonds, or munis, can be especially useful if you want to increase the amount of income you keep after taxes. The interest on these government-issued bonds is generally exempt from federal income tax. In some cases, bonds issued in an investor's home state might also be exempt from state income tax.

This tax treatment can make munis more valuable for retirees in higher tax brackets, but they're not automatically the best income choice. The trick is to compare a muni's tax-free yield with the after-tax yield available from taxable alternatives such as certificates of deposit (CDs), Treasuries or money market funds.

To do this, take the municipal bond's yield and divide it by one minus your marginal federal tax rate. For example, if the muni yields 3.5% and you're in the 32% federal tax bracket, your taxable-equivalent yield is 5.15%, or 0.035 / (1-0.32). If this is higher than the yields offered elsewhere, the municipal bond could be a tax-savvy choice.

4. Bond ladders and target maturity ETFs

Retirees need income on which they can rely, which can be hard to build with equity-linked investments that can be vulnerable to drawdowns. That's where fixed-income strategies such as bond ladders and target maturity ETFs can help.

With a bond ladder, you spread money across bonds or bond funds that mature in different years. As each rung of the ladder matures, you can spend the proceeds or roll it into a new rung to create a steady stream of portfolio cash flow.

Defined maturity ETFs offer one way to build that type of structure without buying individual bonds. "They combine income potential with a known maturity year, which can help investors align fixed income exposure with future spending needs," Bloom says.

For example, the Invesco BulletShares 2030 Corporate Bond ETF (BSCU) will terminate and distribute cash to shareholders around December 15, 2030.

"Instead of holding a perpetual bond fund with no stated end date, investors can build a ladder across maturity years and decide when and how to redeploy proceeds as each rung matures," Bloom says.

That structure can be especially useful when cash yields are at risk of falling. Bloom notes that cash and money market funds can cover near-term spending needs, but their yields reset quickly when short-term rates decline. Target maturity bond ETFs, by contrast, could allow retirees to lock in yields for specific future years. Weigh credit risk carefully, especially if you use high-yield funds.

5. Covered-call ETFs

Covered-call ETFs hold a portfolio of stocks or an index and sell call options against those holdings. The fund can then pass the option premiums along to investors as income.

That extra cash flow might be useful, but it comes with trade-offs. "Covered-call ETFs can provide higher monthly income and smoother returns in sideways markets; however, they have capped upsides during a strong bull market," Fannon says.

If the market price of that security rises above the option's strike price, the option holder will likely exercise the right to buy the shares at the lower strike price.

This makes it important to consider if the higher monthly income is worth giving up some long-term growth potential for future spending, Fannon says. In either case, covered-call ETFs "are typically better suited as a supplement, rather than a core holding," he says.

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Stocks opened higher in Thursday's low-volume session as market participants gauged what a weak June jobs report means for interest rates. And while the Dow Jones Industrial Average and S&P 500 were higher at the close, the Nasdaq Composite swung lower as chip stocks fell again.

At the closing bell, the Dow was up 1.1% at 52,900 — a new record high — and the S&P 500 was fractionally higher at 7,483. The Nasdaq, however, slumped 0.8% to 25,832.

Semiconductor stocks created the biggest drag on the tech-heavy Nasdaq on Thursday, as the high-flying industry continued its recent sell-off. The iShares Semiconductor ETF (SOXX) fell 5.6% today, bringing its two-day decline to nearly 12%, but the exchange-traded fund remains more than 88% higher for the year to date.

Flash storage specialist Sandisk (SNDK), which is the best S&P 500 stock of 2026 so far with its 635% year-to-date gain, shed 14.1%. And memory chip maker Micron Technology (MU) — up 240% since the start of the year — fell 5.5%.

Tesla drops despite strong deliveries

Tesla (TSLA) was another notable decliner on Thursday, dropping 7.5% despite the electric vehicle (EV) maker reporting stronger-than-expected second-quarter deliveries.

For the three months ending June 30, Tesla delivered 480,126 vehicles — the bulk of which were its Model 3 sedan and Model Y SUV — up 34% over the first quarter and 25% from the year prior. Analysts expected TSLA to report deliveries of 406,000.

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Given the impressive deliveries growth, it's likely that today's price move for the Magnificent 7 stock is a "buy the rumor, sell the news" event. Indeed, shares gained more than 13% from June 25 through July 1.

Walmart bounces back

Walmart (WMT) fell nearly 4% on Wednesday, dragged down by a report from Cleveland Research that suggested the mega-retailer has experienced slowing same-store sales in recent months.

In its fiscal 2027 first-quarter earnings report, which was released in May, the company reported comparable sales growth of 4.1%, a slightly slower rate than the 4.6% it disclosed in its fiscal 2026 Q4 print.

But investors appear to be shaking off yesterday's news, with WMT stock up 2.8% today, making it one of the best Dow Jones stocks. And Wall Street remains upbeat about the blue chip stock's longer-term prospects.

Of the 43 analysts covering the retailer who are tracked by S&P Global Market Intelligence, 37 say it's a Buy or Strong Buy, while five have it at Hold and one says Strong Sell. This works out to a high-conviction consensus Buy recommendation.

Speaking for the bulls is Morgan Stanley analyst Simeon Gutman, who has an Overweight (Buy) rating on Walmart. "WMT's flywheel does not show signs of slowing, with shopper incidence increasing both in-store and online, top-tier and stable membership penetration, and rising share as a most-frequented retailer," writes Gutman in a recent note. "We continue to believe WMT is well-positioned to gain share within the current challenging macro backdrop."

Weak June jobs data quiets the rate-hike talk

In economic news, data from the Bureau of Labor Statistics showed the U.S. added just 57,000 new jobs in June, well below the 115,000 economists expected.

Additionally, job growth for April was revised down by 31,000, from +179,000 to +148,000, and May's figure was lowered by 43,000, from +172,000 to +129,000. This results in 74,000 fewer positions than previously reported.

But the weak June jobs report "isn't cause for alarm," says Elizabeth Renter, senior economist at NerdWallet. "The unemployment rate [which fell to 4.2% from 4.3%] remains in good territory, as does the slow, steady growth in jobs amid demographic changes and some economic uncertainty."

And Jennifer Timmerman, senior investment strategy analyst at Wells Fargo Investment Institute (WFII), says that the moderation of job growth takes "the steam out of market expectations for Fed rate hikes by year-end."

According to CME FedWatch, futures traders are pricing in a 43% chance the federal funds rate will be at 3.75% to 4.00% by the end of 2026, up from its current target range of 3.5% to 3.75%.

As a reminder, Friday, July 3, is a stock market holiday, with the stock and bond markets closed in observance of Independence Day.

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Stocks struggled to get off the ground Wednesday as volume thinned out ahead of the long holiday weekend. As a reminder, the bond markets will close early tomorrow for the Fourth of July, and both the stock and bond markets will be closed on Friday.

At the close, the Dow Jones Industrial Average was down 0.03% at 52,305, and the S&P 500 was 0.2% lower at 7,483.

The Nasdaq Composite, meanwhile, slumped 0.7% to 26,040 as investors continued to take profits on several red-hot memory chip stocks. Micron Technology (MU), for one, slumped 10.6% but remains up nearly fourfold for the year to date. And Sandisk (SNDK) — the best S&P 500 stock of 2026 so far with its 760% year-to-date return — plunged 10.6%.

Meta soars 9% on surprising cloud shift

While sharp losses in semiconductor stocks dragged on the Nasdaq, a big rally in Meta Platforms (META) shares helped limit losses for the tech-heavy index.

META jumped 8.8% — its best day since January — after a Bloomberg report indicated the Facebook parent is building out a new cloud business and will sell its excess artificial intelligence (AI) computing power to external customers. This will allow Meta to earn revenue on the computing capacity it is not using.

"Meta building a cloud business is the single most powerful near-term rebuttal to the 'hyperscalers are overbuilding without clear ROI' bear narrative," says Luke Lango, lead technology and cryptocurrency analyst at InvestorPlace. "Every dollar of Meta cloud revenue that flows from an external customer is a dollar that justifies another dollar of Meta infrastructure spending."

Salesforce jumps on Guggenheim upgrade

Over on the Dow, Salesforce (CRM) emerged as one of the best performers of the day, adding 4.2% after Guggenheim analyst John DiFucci upgraded the enterprise software stock to Buy from Neutral (Hold).

CRM is down more than 38% for the year to date, making it the worst Dow Jones stock of 2026 so far, on concerns that AI will create an existential crisis for software-as-a-service (SaaS) firms.

While DiFucci admits that AI creates "a significant risk" to SaaS business models, "the Armageddon scenario currently priced into the stock is misaligned with reality."

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The analyst set a $228 price target on CRM, which he says is trading at "an attractive entry point," representing implied upside of 40% to current levels.

Caterpillar sinks after Burry unveils new short position

At the other end of the Dow was Caterpillar (CAT), which plunged 6.9% after "Big Short" investor Michael Burry said he is betting against the high-flying industrial stock.

Shares are up 73% for the year to date due in part to strong demand for its power energy segment, which supplies AI data centers. Its construction unit has also seen impressive growth.

"I have never shorted Caterpillar," Burry wrote in a Substack post. "It has always done great for me on the long side." But the stock "jumped out" at him due to its stretched valuation, he said.

According to Morningstar, CAT is now trading at a price-to-sales ratio of 7.07, well above its five-year average of 2.54.

ADP jobs data comes up short

In economic news, data from ADP showed the U.S. added 98,000 private payrolls in June, below the 122,000 from May and the 110,000 new jobs economists expected.

While private job growth slowed in June, "nine of 10 industries gained workers," says Elizabeth Renter, senior economist at NerdWallet. "This dispersion is a good sign, even if education and health services continue to pull more than their share of the weight."

The ADP report was released ahead of tomorrow's June jobs report, which is expected to show the addition of 115,000 new nonfarm payrolls. This data will give us "a better understanding of the June labor market," says Renter. "It's likely to illustrate steady stability — both nothing alarming and nothing to get too optimistic over."

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Warren Buffett famously quipped that diversification is for people who don't know what they're doing. Judging by the explosive growth of S&P 500 ETFs in the past few decades, millions of investors are perfectly fine playing dumb — and their retirement accounts are thanking them for it.

Beating the market year after year is incredibly hard. Even Warren Buffett couldn't do it consistently. He's considered the GOAT of long-term investing for good reason.

From 1964 to 2024, Berkshire Hathaway (BRK.B) delivered an overall gain of more than 5,500,000%, or a compound annual gain of nearly 20%. By comparison, the S&P 500, the main benchmark for U.S. stocks, gained 39,000% and 10%, respectively.

Doubling the performance of the broader market over a six-decade span is an investing feat that might never be repeated. Yet, Berkshire stock still trailed the S&P 500 in 20 of those years, once by as much as 40 percentage points.

Most professionals come nowhere close to Buffett's run. Actively managed mutual funds have a poor track record when it comes to beating their benchmarks. In the past 20 years, 93% of U.S. large-cap stock funds lagged the performance of the S&P 500, according to S&P Global.

There are a lot of reasons that most portfolio managers can't beat the market, but perhaps the most important is that most stocks can't beat the market.

Between 1990 and 2020, more than 55% of all U.S. stocks underperformed risk-free, one-month U.S. Treasury bills, says Hendrik Bessembinder, professor of finance at Arizona State University's W.P. Carey School of Business. These stocks didn't just lag the S&P 500; they failed to beat cash.

Even more distressing, the entirety of the $76 trillion in net global stock market wealth created in that three-decade period was generated solely by the top-performing 2.4% of stocks.

As Vanguard founder Jack Bogle liked to say: "Don't look for the needle in the haystack. Just buy the haystack!"

It took a while for the investing masses to embrace Bogle's advice, but passive investing finally came into its own. In 2006, S&P 500 ETFs collectively held about $80 billion in assets under management. Today, that figure stands at about $2.7 trillion.

Thanks to their low fees — and a remarkably resilient secular bull market — investors who've settled for "merely" market-matching returns have had a strong run these past 20 years.

The bottom line on S&P 500 ETFs?

Although the Vanguard S&P 500 ETF (VOO) is the largest S&P 500 ETF by assets under management, it didn't begin trading until 2010. Therefore, we're going to go with the granddaddy of them all — the SPDR S&P 500 ETF Trust (SPY) — to see what broad exposure to U.S. equities has done for buy-and-hold types these past two decades.

Have a look at the above chart and you'll see that if you'd put $1,000 into the SPY 20 years ago, it would today be worth more than $8,500. That's good for an annualized return of 11.2%. (The S&P 500's total return — price change plus reinvested dividends — came to 11.3% over the same span. S&P 500 ETFs trail their benchmark because of fees and cash drag from unpaid dividends.)

Since 1928, the market's rolling 20-year compounded annual returns have been as high as 17.7% (1980-1999) and as low as 2.6% (1929-1948), according to Nicholas Colas, co-founder of DataTrek Research.

"The fate of the next 20 years for the S&P 500 is largely reliant on the development of artificial intelligence and whatever innovations come after it, and the ability for U.S. companies to generate substantial profit from these technologies," he notes. "We remain optimistic and are long-term bulls on U.S. large-cap stocks."

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Investors, traders and speculators observed the end of the second quarter and the first half of the year on Tuesday by extending a holiday-week risk-on rally. Technology took the lead, as chipmakers celebrated their best-ever three-month gain, and another survey suggested consumers are feeling better about the broader economy.

The Philadelphia Semiconductor Index rose more than 80% from April through June on demand for chips, hardware and memory to sustain a revolutionary buildout for artificial intelligence (AI) infrastructure.

The index of semiconductor stocks is up more than 90% so far in 2026, putting it on track for its best performance since the peak of the dot-com boom in the late 1990s and early 2000s.

At the closing bell, the Nasdaq Composite was up 1.5% at 26,213. The tech-heavy index shed 2.8% in June, but it was higher by 21.4% for the second quarter and has added 12.8% so far in 2026.

The S&P 500 added 0.8% to 7,499, leaving the broad-based index down 1.1% for the month, but up 14.9% for the quarter and 9.5% for the year.

The Dow Jones Industrial Average inched up 0.3% to 52,317, a second straight all-time closing high. The blue-chip index was higher by 2.5% in June, also notching a new all-time monthly closing high.

Papa Dow, 130 years old as of May 26, added 12.9% in the second quarter and 8.9% during the first six months of the year.

Friday, July 3, is a stock market holiday, with the stock and bond markets closed to observe the Fourth of July.

An update on the confidence game

The front-month West Texas Intermediate crude oil futures contract was down 0.9% to $70.09 per barrel on Tuesday, as the U.S. and Iran continue to negotiate a durable truce that will unclog the Strait of Hormuz.

WTI traded at $67.02 on February 27, the day before the war in the Middle East began, and $101.38 on March 31. The North American oil benchmark has now declined by more than 40% from its wartime peak of $119.48 on March 9.

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In a related development, The Conference Board Consumer Confidence Index printed at 91.2 this month vs 90.6 in May. The survey was conducted between June 1 and June 23.

According to The Conference Board Chief Economist Dana Peterson, "Consumer confidence inched up in June as falling oil prices in recent weeks provided some relief to consumer inflation fears."

Good defense was the best way to play offense today

AeroVironment (AVAV, +18.8%) showed why it's one of the best defense stocks to buy right now when the dronemaker reported better-than-expected quarterly results but lighter-than-forecast annual guidance after the closing bell on Monday.

AVAV retraced much of a year-to-date decline of more than 40%, as markets recognized solid numbers in the aggregate amid management's efforts to recover from the loss of a government contract and fix the impact of an accounting error that resulted in a goodwill-related impairment charge.

AeroVironment posted fiscal fourth-quarter earnings of $1.84 per share on revenue of $642 million vs a Wall Street forecast for EPS of $1.46 on revenue of $556 million. Management guided to EPS of $3.02 to $3.34 on revenue of $2.1 billion to $2.2 billion for fiscal 2027, while analysts see EPS of $3.84 on revenue of $2.2 billion.

“Fiscal 2026 marked a transformational year for AV," CEO Wahid Nawabi said in a statement, noting that his company is "well-positioned to capture the rising global demand across lethal and non-lethal drones, counter-UAS, space and advanced technologies."

CNXC adjusts its targets

Concentrix (CNXC, -11.2%) seemed to confirm market concerns about the effects of AI-based tools on companies that provide software-based customer experience and business outsourcing services, as management cut its top- and bottom-line guidance for the coming quarter and the full fiscal year.

Concentrix, an industrial stock that actually includes "scaling secure AI technologies" among its professional services capabilities, reported a narrow second-quarter miss: EPS of $2.63 on revenue of $2.46 billion against a consensus estimate of $2.64 on $2.47 billion.

But markets, all forward-looking here, focused on third-quarter EPS guidance of $2.65 to $2.77 on revenue of $2.465 billion to $2.490 billion against a consensus EPS estimate of $3.08 on revenue of $2.53 billion.

That's short almost 14% at the midpoint for the bottom line, 2% at the top. And full-year EPS guidance is short about 7% at the midpoint vs Wall Street's forecast, while revenue guidance shows a 1% expectations deficit.

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The main equity indexes gapped up, slumped briefly, then surged again to start a holiday-shortened week on a positive note. The Nasdaq Composite and the S&P 500 ended their respective five-session losing streaks during a risk-on rally that also lifted the Dow Jones Industrial Average to its first-ever close above 52,000.

"We typically rally into holiday weekends," Louis Navellier of Navellier & Associates observes, "and it would be downright un-American not to be optimistic heading into the Fourth of July, especially considering it is the 250-year anniversary celebration."

Friday, July 3, is a stock market holiday, with the stock and bond markets closed to observe the Fourth of July.

As Navellier explains, the market is also benefiting from a realignment of the Russell 2000 Index and resulting demand for small-cap stocks and mid-cap stocks. "Additionally," he writes, "SpaceX (SPCX, +7.2%) was added to the Russell 1000 at the start of the week."

Navellier expects "fundamentally superior stocks" to enjoy a collective bounce "from institutional investors making their portfolios 'extra pretty' before they do their quarter-end reviews."

Comcast breaks up

Communication services stocks paced the rally at a sector level after Comcast (CMCSA, +4.5%) announced a plan to spin off NBCUniversal and Sky into a separate publicly traded company.

"Comcast will continue to build on its leadership in connectivity," co-CEO Mike Cavanaugh said in a statement announcing the split, "while NBCUniversal, together with Sky, will have the scale, brands, content and financial resources to compete as a premier global media and entertainment company."

Charter Communications (CHTR, +9.4%), a rumored acquisition target for Comcast's connectivity business amid a merger market that's heating up, was among the top-performing S&P 500 stocks on Monday.

Another sector stalwart, Alphabet (GOOGL, +4.8%), was among the top-performing Dow Jones stocks during its first trading day as a member of that price-weighted index. Verizon Communications (VZ, -5.3%), removed from the Dow to make room for GOOGL, fell sharply.

At the closing bell, the tech-heavy Nasdaq Composite was up 2.1% to 25,820, the broad-based S&P 500 had added 1.2% at 7,440, and the blue-chip Dow Jones Industrial Average was higher by 0.6% to 52,182.

Will a World Cup stock score this week?

It's a mostly quiet week on the earnings calendar, except for Nike (NKE, +1.8%). Down 35% year to date through Friday, one of Wall Street's top World Cup stock picks will report fiscal fourth-quarter results after the closing bell on Tuesday.

Stifel analyst Peter McGoldrick is "not ready to call a bottom" for NKE stock. "Our thesis states dominant market position is unlikely to translate to value creation absent 1) a favorable change in consumer preference, or 2) a reinvigoration of the innovation pipeline at scale," McGoldrick writes.

The analyst reiterated his Hold rating on the consumer discretionary stock but cut his 12-month target price from $56 to $50, citing lackluster performance and erosion of its share of the athletic market.

According to McGoldrick, "Investors will focus on FY27 guidance, capacity for topline growth, and EBIT margin rebound from trough levels in FY26." At the same time, he notes, management has little incentive to raise expectations before its traditional investor day in the fall.

Supreme Court says the Fed might be exceptional

The Supreme Court ruled on Monday that President Donald Trump can fire Federal Trade Commissioner Rebecca Slaughter. But can President Trump fire Fed Governor Lisa Cook? Well, no, at least not yet.

Writing for a 5-4 majority in Trump v. Cook (pdf), Chief Justice John Roberts said the Trump administration's interpretation of the law "would in effect transform the Federal Reserve's for-cause protection into at-will employment — an interpretive leap out of step with the statute Congress enacted and our Nation's tradition of central banking protected from political interference."

But Roberts left open the possibility that Trump can remove Cook, pending the Fed governor's case against the president in a lower federal court.

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"To be clear," the chief justice explained, "the ultimate question of whether the President can remove Cook for cause will depend in part on the underlying facts. In this opinion, we have not addressed the facts, as they have yet to be found or analyzed under the relevant legal standards."

In a separate 6-3 decision, the Court abandoned a 91-year-old precedent and expanded President Trump's authority over (most) of the executive branch.

"If anything more is left of Humphrey's," Roberts wrote for the majority, referring to the 1935 decision in Humphrey's Executor v. United States that established a principle of independence for federal agencies, "we overrule it."

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Stocks opened lower Friday as tech stocks slumped on reports that artificial intelligence (AI) giant OpenAI is considering delaying its initial public offering (IPO). And while the main equity indexes were in positive territory by lunchtime thanks to strength in defensive sectors, including healthcare and consumer staples, momentum faded into the close.

Late Thursday, The New York Times reported that advisers to OpenAI are encouraging CEO Sam Altman to delay the ChatGPT parent's offering until 2027. This comes amid recent volatility in SpaceX (SPCX, +0.2%), which went public earlier this month in the biggest IPO ever.

OpenAI confidentially filed its IPO paperwork with the Securities and Exchange Commission in early June, with some suggesting it could go public as soon as Q3 2026.

But a potential delay "is a rational, strategically sound decision by one of the most sophisticated management teams and advisory networks in the technology industry," says Luke Lango, lead technology and cryptocurrency analyst at InvestorPlace.

Lango believes OpenAI would be going public "in a competitive environment where Anthropic's rapid progress has created legitimate uncertainty about long-term market share dynamics" and "in a market that just watched SPCX's $1.75 trillion IPO produce more volatility than anyone wanted."

The news sent the Nasdaq Composite down more than 1% at Friday's open, though the tech-heavy index closed with a more modest loss of 0.2% to 25,297. Memory chip stocks created some of the biggest headwinds for the Nasdaq, with Micron Technology (MU, -6.7%) and Sandisk (SNDK, -10.5%) both posting notable losses on Friday.

Elsewhere, the broader S&P 500 slipped 0.05% to 7,354, while the blue-chip Dow Jones Industrial Average — which will add Google parent Alphabet (GOOGL, -2.2%) to its 30-stock roster on Monday — fell 0.09% to 51,876.

ON Semiconductor sinks 24% on deal drama

ON Semiconductor (ON) was another notable tech loser on Friday, sinking 23.7% to make it the worst S&P 500 stock of the day, after the chip manufacturer said it will buy Synaptics (SYNA, -3.7%) in an all-stock deal valued at roughly $7 billion. This also marks ON's largest single-day drop since October 2023.

"By adding Synaptics' differentiated Edge AI compute franchise and strong portfolio of human-machine interface and wireless connectivity solutions, onsemi is expected to extend its capabilities beyond power and sensing to intelligent systems, delivering greater value to a broad range of end markets," ON Semi explained in the press release.

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The reaction from market participants is likely "an investor preference for a data center rather than edge enhancement," says B. Riley Securities analyst Craig Ellis. But Ellis believes it's "a logical product line extension play from data center AI toward the edge for significant SAM expansion into a $100 billion CY30 AI opportunity now including more humanoids and robotics."

Ellis reiterated his Buy rating on ON and lifted his price target to $135 from $118.

Moderna stock soars on sector rotation, drug news

On the plus side of Friday's ledger was Moderna (MRNA), which rose 12.6% to put it at the top of the S&P 500. In addition to a broader rotation into defensive stocks, the drugmaker got a boost after unveiling its first in vivo CAR-T autoimmune therapy program during Thursday's investor day.

"We do think there is investor interest more broadly in the oncology pipeline and new sources of future growth and diversification beyond infectious disease and COVID/Flu, etc.," says UBS Global Research analyst Michael Yee.

But the new programs discussed on Thursday won't be potential growth drivers until at least 2030, Yee says. As such, focus for now is on the company's INT cancer vaccine, with Phase III data expected later this year, and lowering operational expenditures to reach breakeven.

Yee has a cautious Neutral (Hold) rating on the healthcare stock and a $45 price target — more than 30% below its current price.

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Google parent Alphabet (GOOGL) will replace Verizon Communications (VZ) in the Dow Jones Industrial Average (DJIA) at the opening of trading on Monday, June 29, making the 30-stock bastion of blue chip companies increasingly exposed to all things digital.

Alphabet is best known to consumers as the operator of Google and YouTube, but as S&P Global notes, GOOGL's diversified portfolio spans advertising, cloud infrastructure, artificial intelligence, hardware, self-driving cars and healthcare technology.

"Adding Alphabet will broaden and strengthen the DJIA's exposure to these dynamic areas of the U.S. economy," S&P Global said in a press release. "Its larger market capitalization and share price, together with the breadth of its businesses, make it a more representative Communication Services constituent in the DJIA."

The move refers to Alphabet's Class A shares. The Class C shares (GOOG) will not be in the Dow.

Telecom giant Verizon, which has been in the Dow since 1984, sounds like a pretty poky business by comparison. Apple (AAPL) replaced AT&T (T) in the Dow in 2015. You might notice a pattern here.

S&P Global notes that Verizon represents only one-half of one percentage point of the DJIA due to its low share price. The Dow is a price-weighted index, and "persistently lower-priced stocks have an immaterial impact on the index," S&P Global said.

As much interest as such events generate, being tapped for the Dow is more symbolic than material. The S&P 500 is the main benchmark for U.S. equity performance. That's why the total amount of money passively tracking the index comes to around $12 trillion.

For example, the largest exchange-traded fund (ETF) in the world, the Vanguard S&P 500 ETF (VOO), has more than $1.7 trillion in assets under management alone. A comparable product for the DJIA, the State Street SPDR Dow Jones Industrial Average ETF Trust (DIA), holds just $43 billion in assets under management.

Lastly, the Dow is weighted by price rather than by market cap. Although GOOGL has an outsize influence on the movements of cap-weighted benchmarks, such as the S&P 500, Nasdaq Composite and Nasdaq-100, at current prices, GOOGL will be as material to the DJIA as, roughly, Sherwin-Williams (SHW).

Nevertheless, the blue-chip average will now include many of the biggest names among tech and communication services stocks: Apple, Amazon.com (AMZN), Nvidia (NVDA) and Microsoft (MSFT), as well as Salesforce (CRM), Cisco Systems (CSCO) and International Business Machines (IBM).

Is GOOGL stock a Buy?

GOOGL joining the Dow is not in and of itself a reason to buy the Magnificent 7 stock. Nothing about its fundamentals has changed. While shares are currently in a 15% drawdown from their May peak, Wall Street remains bullish.

Of the 63 analysts covering GOOGL surveyed by S&P Global Market Intelligence, 42 rate it at Strong Buy, 14 say Buy and seven call it a Hold. That works out to a consensus recommendation of Strong Buy.

The Street's investment case for GOOGL comes down to AI. (Duh.)

"Alphabet remains, at a minimum, competitive, if not a leader, in the development of generative AI, the rapidly developing and perhaps disruptive new computing paradigm," writes Argus Research analyst Joseph Bonner, who rates shares at Buy. "We continue to like Alphabet's underlying businesses and believe that GOOGL shares are attractively valued given the company's growth runway."

The bottom line: If you liked GOOGL before its accession to the bluest of blue-chip clubs, there's no reason to change your mind. But don't buy it just because it's a better fit for the Dow Industrials than Verizon.

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Employees at companies that offer equity compensation have the opportunity to grow significant wealth, but it also comes with considerable risk.

Having too much of your net worth tied up in a single company makes you vulnerable to volatility and both short- and long-term losses, depending on the firm's success.

I've seen many employees with concentrated stock positions at tech companies and in other industries who feel conflicted about selling their shares. They may have an emotional attachment to the company or even feel disloyal selling off their shares.

Not to mention that selling all your shares at once can leave you with a large tax bill.

With a thoughtful approach, investors may be able to address the risks associated with a concentrated stock position over time, seek tax efficiency, and remain invested in their company and industry while managing potential downside exposure.

Stock concentration isn't always bad, but it needs a plan

Having a concentrated stock position isn't inherently bad. For many clients, that stock concentration is exactly how they built their wealth in the first place. The goal is simply to make sure your exposure is intentional and appropriate for your situation.

There's no set rule of thumb for how much of your portfolio your company stock should make up. I generally prefer people to keep their single stock concentration to less than 40% of their portfolio, but many advisers take an even more conservative approach, recommending closer to 10% or 20%. The younger you are, the higher percentage of your portfolio it can make up.

It also depends on your other assets. If you have substantial liquid assets, that 40% may be appropriate. But if you have real estate and other illiquid assets, a lower percentage is likely better.

Here are five strategies to manage your concentrated stock position:

1. Understand what you're working with

Stock compensation comes in several forms, including incentive stock options (ISOs), non-qualified stock options (NQSOs) and restricted stock units (RSUs). Each type comes with a different tax treatment, which affects your strategy.

Before you plan your next steps, you need a clear understanding of what you own, when it vests and how you'll be taxed on it.

2. If your company is still private, build your tax-loss bucket now

If your company is heading toward an IPO, you could have several years to start preparing for the large tax bill. Start creating a tax loss bucket in advance.

You can start harvesting your tax losses by selling losing positions in your investment account, capturing those losses, and reinvesting in a comparable security.

You'll slowly build up a reserve of losses you can use to offset the gains you'll earn when you eventually sell your IPO shares.

High earners with sufficient investable assets can also explore specialized investment strategies, such as direct indexing vehicles, to give you more control and help you create tax losses to offset your future gains.

3. You don't have to unwind everything at once

Many employees take one of two extremes when their company IPOs: They either sell everything right away, or they don't sell anything at all. Neither is necessarily the right option.

First, you'll typically be subject to some sort of lockup period, usually 180 days, during which you won't be allowed to sell any of your shares. But you can still use this time to prepare.

Once the lockup period ends, consider a staged selling strategy rather than selling everything all at once. You can spread your sales across multiple tax years to lower your tax bill, reduce the impact of net investment income taxes and, ideally, avoid bumping yourself into the next tax bracket.

By staging your selling over several years, you can significantly lower your tax burden and remove some of the emotional pressure that comes with trying to perfectly time your sale.

4. Consider an exchange fund for long-held stock positions

If you have a highly appreciated stock position worth at least $500,000 to $1 million, an exchange fund can help you diversify it without a large tax consequence. You exchange your concentrated stock position for a private diversified portfolio of securities contributed by other investors.

This strategy isn't appropriate for everyone, as it requires a large investment and a seven-year holding period before you can exit the fund with your holdings — an earlier exit puts you at risk of financial penalties and taxes.

However, if you're a candidate for this strategy, it can be a powerful tool to save a significant amount in taxes.

5. You can diversify without abandoning your industry

A common sentiment among employees with highly concentrated stock positions, especially in the tech industry, is a desire to remain heavily invested in the sector.

Depending on your risk tolerance, you don't have to abandon your tech holdings, but instead spread them out across more companies. You can preserve the potential upside without a single bad earnings report causing a major hit to your net worth.

The bottom line: There's no one-size-fits-all plan, but early planning is key

Stock concentration is common among employees at post-IPO firms or companies that offer equity compensation packages.

There's no one right strategy to address this situation, as it depends on your age, liquidity, risk tolerance and other key factors.

If your company is still pre-IPO, time is on your side, as you have plenty of time to plan your strategy. And if you work for a public company, you have options to exit your concentrated position with less of a tax impact.

Concentrated stock can create life-changing wealth; it's just important to have the right strategy in place to manage it.

Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. #2026-12426

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Stocks were volatile Thursday as market participants weighed mixed signals from the tech sector. Wall Street also sifted through the latest inflation data, which came in better than expected, but is unlikely to change the trajectory for interest rates this year.

At the close, the blue-chip Dow Jones Industrial Average was up 0.1% at 51,920, while the broader S&P 500 was fractionally lower at 7,357 and the tech-heavy Nasdaq Composite was down 0.5% at 25,358.

Caterpillar (CAT) was the best Dow Jones stock today, adding 6.3% to bring its daily win streak to seven. The industrial stock is also the best-performing Dow component of the year, up nearly 85% so far, on expectations that the heavy equipment maker will capitalize on demand for the artificial intelligence/data center buildout.

UBS Global Research analyst Steven Fisher thinks power generation opportunities will remain strong in the U.S. "until either grid investment ramps up materially or large turbine production capacity ramps up."

And this should support Caterpillar's "earnings growth, along with continued dealer inventory build in construction, a pickup in the mining cycle, and more oil & gas customer investments."

However, Fisher has a Neutral (Hold) rating on the blue chip stock and a $900 price target — below its current price — noting that its upside potential is likely limited from here given CAT's strong run up the price chart.

Apple sinks on MacBook, iPad price hikes

Apple (AAPL), on the other hand, was the worst-performing Dow stock on Thursday, sinking 6.2% on news the company will be hiking prices on several of its products, including the MacBook and iPad.

Earlier this month, outgoing CEO Tim Cook warned that "price increases are unavoidable" given higher costs for components such as memory chips. And the company implemented the hikes today, raising prices for most of its products by $100 to $200.

For instance, as Tech Radar reports, the new MacBook NEO is now priced at $699, up from $599. And the 12-inch MacBook Air costs $1,299 to start, up from $1,099 previously.

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Passing these "increased costs onto consumers is emblematic of the substantial expenses associated with AI technologies, which have raised concerns about the capital-return prospects of the initiatives," says José Torres, senior economist at Interactive Brokers. "Also, the need to increase prices is undermining hopes that related projects will offer deflationary relief."

Micron soars 16% on memory chip demand

One company that is benefiting from higher semiconductor costs is Micron Technology (MU), which soared 15.8% — and gained $186 billion in market value — after the memory chipmaker reported its fiscal third-quarter results.

For the three months ending May 28, Micron said earnings rose to $25.11 per share from $1.91 per share in the year-ago period. Revenue surged nearly 350% to $41.5 billion. Analysts expected earnings of $20.05 per share on $35 billion in revenue.

"Micron's record fiscal Q3 financial results and even stronger outlook for Q4 reflect the strategic value of memory in the AI era," said Micron CEO Sanjay Mehrotra in the earnings release.

For fiscal Q4, the company guided for earnings of $31 per share at the midpoint and revenue of $50 billion.

"MU delivered another strong quarter, reinforcing our constructive view on memory's role in AI and the increasing supply-side discipline supporting a more durable cycle," says BofA Securities analyst Vivek Arya.

Even with the tech stock up more than fourfold for the year to date, Arya believes its "valuation remains compelling," and raised his price target to $1,550 from $1,500 — representing implied upside of 27% from current levels.

PCE comes in better than expected, but keeps rate cuts out of reach

In economic news, the Bureau of Economic Analysis (BEA) this morning said the Personal Consumption Expenditures Price Index (PCE) — the Federal Reserve's preferred measure of inflation — rose 0.4% from April to May and was 4.1% higher from the year prior.

Core PCE, which excludes volatile food and energy prices, was 0.3% higher month over month and up 3.4% year over year.

"Oil prices are heading lower but the inflation problem remains, as core PCE is up 3.4% since last year and showing no signs of abating," says Sonu Varghese, chief macro strategist at Carson Group. "This isn't about energy and tariffs either, as AI-related bottlenecks are also pushing inflation higher."

Varghese believes that the Fed's job only gets harder from here, especially as the labor market continues to improve. "But we think the committee will avoid rate hikes this year as a majority wait for inflation to pass, allowing the economy (and markets) to run hot."

Futures traders, however, expect the next move to be a rate hike. According to CME Group FedWatch, betting odds are for the Fed to raise the federal funds rate by a quarter percentage point by year's end.

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Another big rebound on the other side of the world suggested stocks would rise in the U.S., too, and that's what happened early on Wednesday. But investors, traders and speculators remain wary about the speed and scale of the artificial intelligence (AI) buildout.

South Korea's KOSPI Index bounced back in a big way after a sharp sell-off from new highs, just as it did in March and April, rising as much as 4.6% and finishing with a gain of 3.3%.

More than half of the KOSPI's value is tied to Samsung Electronics (SSNLF) and SK Hynix (HXSCL), which were up 9.8% and 1.0%, respectively, on their local exchange.

Fellow semiconductor stocks such as Nvidia (NVDA, -0.5%) enjoyed some stateside follow-through, as tech- and AI-related names attracted dip-buyers through midday. Selling pressure returned after lunch.

Industrials, utilities and consumer discretionary stocks — most notably big box retailer Home Depot (HD, +5.7%) — paced the rally over here at a sector level.

"The recent volatility in AI-related names — particularly chip stocks — has been widely described in terms of 'technical exhaustion'," observes Daniel Skelly, head of Morgan Stanley's wealth management market research and strategy team.

Skelly sees evidence of weakness in the fundamental story, too, "including possible AI-model pricing wars and increased sensitivity about spending among AI hyperscalers."

By the closing bell, the tech-heavy Nasdaq Composite had slipped 0.4% to 25,476, and the broad-based S&P 500 was down 0.1% at 7,358. But the blue-chip Dow Jones Industrial Average held on for a 0.4% gain to 51,848.

Warsh has a legendary act to follow

That the front-month West Texas Intermediate crude oil futures contract was down another 4.3% to $70.06 per barrel on Wednesday will relieve consumers and policymakers worried about inflation. That the 2-year Treasury yield backed off from 52-week highs today to 4.148% vs 4.200% on Tuesday will comfort anyone watching interest rates.

That they're calling what happened in South Korea yesterday "Black Tuesday" is a reminder that new Federal Reserve Chair Kevin Warsh has a tough act to follow. But so did Ben Bernanke, Janet Yellen and Jerome Powell.

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Indeed, Alan Greenspan, who passed away on Monday, is the model for the modern Fed chair.

Whether you need to know how to run a central bank (or you're forming a jazz band), the old Fed chair has answers for you.

Here are five lessons (we can all learn) from Alan Greenspan.

Papa Dow trades VZ for GOOGL

Alphabet (GOOGL, -0.2%) will be the latest Magnificent 7 stock to join the Dow Jones Industrial Average, S&P Global announced on Tuesday.

The Google parent will replace Verizon Communications (VZ, -2.1%) in the price-weighted index before the opening bell this Monday, June 29, with the swap reflecting a divergence among communication services stocks at a moment defined by AI.

As S&P Global notes, adding Alphabet will "broaden and strengthen" Papa Dow's exposure to AI, as well as advertising, cloud infrastructure, hardware, autonomous mobility, healthcare technology and media distribution.

"Its larger market capitalization and share price, together with the breadth of its businesses, make it a more representative Communication Services constituent in the DJIA," the data provider says.

S&P Global also said Honeywell (HON, +2.3%) will remain one of the 30 Dow Jones stocks after it completes the spinoff of Honeywell Aerospace on June 29.

Micron is reporting earnings right now

Micron Technology (MU, -0.4%) hit a new all-time high on Monday, but the tech stock put up red numbers during the two trading sessions ahead of its post-closing-bell turn on the earnings calendar today.

Of course, a year-to-date gain of 268.7% through Tuesday means expectations are still sky-high; indeed, Wall Street expects management to report earnings growth of 950% on revenue growth of 276%.

Those are big numbers. And they make sense, according to Wedbush analyst Matt Bryson.

"With numbers moving higher, demand for AI seemingly set to remain robust through CY2027 (if not 2028), limited likelihood of oversupply over the next 18 months, and finally a strong likelihood MU exceeds our estimates," the analyst argues, "we see no reason to shift our positive view on the name."

Bryson reiterated his Overweight (Buy) rating and raised his 12-month target price on MU stock from $550 to $1,300 in a preview of management's fiscal third-quarter report.

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Here at Kiplinger, we want to ensure that you have the best financial advice at your fingertips — and that you can understand the specialized terminology often used for complex topics such as investing.

That's why we put together this short quiz to test your knowledge on a handful of key investing terms. Knowing what these words and phrases mean will help you stay a step ahead in those big decisions you have to make about what's in your portfolio and why.

And don't worry if you miss an answer or two. You can follow the links below the quiz to review these investing terms and more.

More on investing from the Kiplinger team:

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A steep sell-off in South Korea spread to Europe and the U.S. on Tuesday, as investors, traders and speculators asked hard questions about the sustainability of capex plans amid what so far has seemed to be an ever-expanding artificial intelligence (AI) boom. Meanwhile, the Trump administration is talking up another cutting-edge corner of the stock market.

The KOSPI Index, which includes South Korea-based semiconductor stocks such as Samsung Electronics (SSNLF) and SK Hynix (HXSCL), fell 910 points, or 9.99%, to 8,203 on Tuesday. The two chipmakers, which account for more than half of the KOSPI's value, had led the index past the 9,100 level for the first time ever on Monday.

By the closing bell, the tech-heavy Nasdaq Composite was off 2.2% at 25,587, the broad-based S&P 500 had declined by 1.4% to 7,365, and the Dow Jones Industrial Average was down 0.1% at 51,666.

"There is a great near-term buying window for many of the high-flying memory and other technology stocks," Louis Navellier of Navellier & Associates observes, noting that memory stocks showed relative strength on Monday as the Nasdaq sold off late, "but lost their mojo" because of what happened overseas.

Indeed, Navellier expects Micron Technology (MU, -13.2%) to announce record top- and bottom-line results after the closing bell on Wednesday. "The last correction in AI-related stocks this month only lasted four trading days," he writes, "so every dip should be viewed as a buying opportunity."

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The front-month West Texas Intermediate crude oil futures contract was down 0.7% to $73.34 per barrel and has now retreated almost 40% from its wartime highs near $120, as inflation pressure from the Strait of Hormuz continues to ease.

Meanwhile, the 2-year Treasury yield ticked up to another new 52-week high on Tuesday before settling at 4.200% vs 4.219% on Monday, as markets continue to price in a path for short-term interest rates under new Fed Chair Kevin Warsh.

Big Blue gets a quantum bounce from the White House

International Business Machines (IBM, +5.0%) was No. 1 among the 30 Dow Jones stocks on Tuesday, as markets bid up the old-school technology firm on word from the White House of two new executive orders designed to accelerate quantum innovation and to protect against cryptographic attacks.

D-Wave Quantum (QBTS, +2.2%) showed green numbers, too. But quantum computing wasn't immune to broader selling pressure in the tech space, with Rigetti Computing (RGTI, -0.5%) and IonQ (IONQ, -0.8%) lower for the day.

Infleqtion (INFQ, +12.0%), which completed its initial public offering (IPO) in February, and Quantinuum (QNT, +13.5%), a former subsidiary of Honeywell (HON, -2.5%) that debuted as a standalone public company on June 4, did post big gains.

"Quantum technologies represent the next generation of innovation across computing, sensing, and networking, with enormous significance for our country's economic growth, scientific research, and cyber security," President Donald Trump said on Monday. "It's really a big deal that we're doing."

ARK is buying more SPCX

SpaceX (SPCX, +1.0%) enjoyed its first positive session since last Tuesday after ARK Invest revealed through its trade notification system that it purchased a total of 210,121 SPCX shares.

The ARK Innovation ETF (ARKK, -2.1%) added 131,837 shares, the ARK Autonomous Technology & Robotics ETF (ARKQ, -2.8%) 43,486. The ARK Next Generation Internet ETF (ARKW, -2.0%) and ARK Space Exploration & Innovation ETF (ARKX, 1.7%) bought 21,506 and 13,292 shares, respectively.

On Monday, SPCX stock was down more than 16%, and its market cap declined by about $400 billion. According to Dow Jones Market Data, that's the second-biggest single-day loss for any company in stock market history.

Susquehanna analyst Charles Minervino initiated coverage of SPCX with a Neutral (Hold) rating and a $170 12-month target price. "The current valuation requires premium multiples on very aggressive revenue and EBITDA growth assumptions," Minervino says. "With some of the markets that SPCX operates in being relatively unproven, we believe a wide range of outcomes exist."

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If you have a modest nest egg, you might want to chase cheap listings so you can buy shares in larger lots. Buying stocks priced below $20 can be tempting.

But "dirt cheap" doesn’t always mean "good value." In fact, many low-priced stocks trade where they trade for legitimate reasons, among them weak earnings, heavy debt and/or broken business models that may never recover.

Still, if price alone isn't a sign of a good stock, then neither should price alone signal a bad stock. The important thing is to focus on fundamentals.

Solid companies with stocks that trade around $20 per share can generate reliable cash flows based on proven business models. Indeed, these are real reasons to invest, beyond price.

Our top picks for stocks priced under $20 per share are established are established companies with respected brands. They have market values greater than $1 billion. And their business models support stable dividends.

Ford Motor

• Sector: Consumer discretionary
• Market value: $59.6 billion
• Dividend yield: 4.3%

Ford Motor (F) is one of the oldest and most recognizable automakers in America, with a history stretching back more than a century.

Ford has invested heavily in electric vehicles and is selling almost 100,000 units annually. But business is still driven by traditional gasoline-powered models such as Ford's F-Series pickup truck, the best-selling vehicle in the U.S. regardless of powertrain.

While not immune to volatility, the consumer discretionary stock offers long-term exposure to onshore manufacturing and transportation trends that have wide support by consumers and policymakers alike.

With a generous dividend of more than 4%, there are multiple reasons to stay patient and buy and hold this low-priced stock for its long-term potential.

Huntington Bancshares

• Sector: Financials
• Market value: $34.6 billion
• Dividend yield: 3.7%

Huntington Bancshares (HBAN) is an Ohio-based regional bank that serves consumers, small businesses and commercial clients across the Midwest.

The company offers a wide range of services, including checking and savings accounts, mortgages, auto loans, credit cards and wealth management, as well as business lending.

Huntington is not exposed to global risks like Wall Street megabanks with proprietary trading desks. Like most regional banks, it generates revenue by making practical loans to households and businesses.

This is no small-fry financial stock, however, with current assets of nearly $300 billion. That's enough scale to support a reliable dividend and make HBAN a top stock trading below $20.

Newell Brands

• Sector: Consumer staples
• Market value: $2.1 billion
• Dividend yield: 5.7%

Newell Brands (NWL), a small-cap stock, isn't the most recognizable name on our list. But its products–such as Rubbermaid storage containers, Sharpie markers, Coleman camping gear, Yankee Candle scented accessories, Paper Mate pens and Graco baby gear–are very well known to consumers.

Indeed, a diversified product line is Newell's biggest strength, as it generates revenue from a collection of everyday goods rather than resting on a one-dimensional business model.

Multiple moving parts with varying exposures to the consumer economy can make it hard for the company to deliver breakneck growth.

But Newell offers a generous dividend yield, and management has spent recent years streamlining operations and reducing debt to provide long-term stability.

Nokia

• Sector: Information technology
• Market value: $80.7 billion
• Dividend yield: 1.4%

Nokia (NOK) is best known for its former dominance in mobile phones.

Today, the tech stock provides the equipment supporting fiber-optic and cloud-computing networks, as well as hardware essential for 5G infrastructure.

With a customer base that includes telecom providers, governments and large enterprises, Nokia has deep relationships with clients and expertise that's hard to match.

As demand for faster and more reliable data networks continues to grow, this telecom infrastructure company will only be more important in the years ahead. Stability makes NOK a solid low-priced stock.

Ambev

• Sector: Consumer staples
• Market value: $48.9 billion
• Dividend yield: 1.2%

Ambev (ABEV) lacks name recognition in the U.S. But the large-cap stock is one of the biggest beverage companies in Latin America. Ambev is also a majority-owned subsidiary of global brewing giant Anheuser-Busch InBev (BUD).

Ambev produces and distributes beer, but it's also licensed to make soft drinks such as Gatorade, Lipton iced tea and other products owned by PepsiCo (PEP).

Legacy soda and beer brands face headwinds in the U.S. because of changing consumer tastes. But growth is strong south of the border.

The dividend has grown more than 40% over the last five years, and Ambev is well-positioned to continue to support a generous yield.

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The main equity indexes were mixed on Monday, as market participants continued to monitor negotiations between the U.S. and Iran and the status of the Strait of Hormuz. Investors, traders and speculators also observed the passing of Alan Greenspan, who led the Federal Reserve for almost 20 years and was among the most important central bankers of our time.

At the closing bell, the blue-chip Dow Jones Industrial Average was up 0.3% to 51,712, but the S&P 500 was down 0.4% to 7,472, and the tech-heavy Nasdaq Composite had shed 1.3% at 26,166.

Communication services stocks were the worst-performing group, with the sector weighed down by recent addition SpaceX (SPCX, -16.4%) posting a third straight daily decline less than two weeks after the biggest IPO ever.

The front-month West Texas Intermediate crude oil futures contract fell by 2.0% to $74.35 per barrel. WTI has retraced about 86% of its surge to $119.48 on March 9, the intraday peak amid war in the Middle East.

The 2-year Treasury yield ticked up/down to 4.232% from 4.179% on Thursday, with the market-based barometer of short-term interest rates hitting another 52-week high on Monday.

Following its two-day meeting last week, the Fed held the federal funds rate steady at 3.50% to 3.75%. You can catch up on news and developments around the FOMC meeting at our June Fed meeting blog.

Alan Greenspan, the 'Maestro' of the modern Fed

Whether you deem the development positive or negative, and even if it's just the way things have always been in your experience, it's fair to say Alan Greenspan is the template for the modern celebrity Fed chair.

Greenspan, who led the world's most important central bank from 1987 until 2006, died on Monday at 100 years old.

Nominated by Ronald Reagan to succeed Paul Volcker, a historical figure in his own right, he led the central bank under a total of four presidents, including Reagan, George H.W. Bush, Bill Clinton and George W. Bush.

After assuming leadership of the Fed on August 11, 1987, Greenspan guided Washington, D.C., and Wall Street out of Black Monday that October and into an economic boom that lasted, almost uninterrupted, through the 1990s.

"Since becoming a central banker," he testified to Congress in September 1987, "I have learned to mumble with great incoherence. If I seem unduly clear to you, you must have misunderstood what I said."

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Later, in December 1996, he wondered, "But how do we know when irrational exuberance has unduly escalated asset values, which then become subject to unexpected and prolonged contractions," as the dot-com era unfolded.

Greenspan, Treasury Secretary Robert Rubin and Treasury Deputy Secretary Larry Summers famously formed what Time magazine called the "committee to save the world" in February 1999.

Bob Woodward of The Washington Post titled his 2000 biography "Maestro: Greenspan's Fed and the American Boom." That was well before his retirement from the central bank in 2006.

It also preceded the Global Financial Crisis/Great Recession of 2007-09, a series of events that earned Greenspan another nickname, "Mr. Bubble," bestowed when he no longer held any real power.

MU sees strong demand

Micron Technology (MU, +6.8%) extended its 2026 rally on Monday as markets prepared for the tech stock to report fiscal third-quarter results after the closing bell on Wednesday.

MU is up nearly 300% so far this year, the semiconductor stock rising along with demand for the memory and storage hardware essential to the still-accelerating artificial intelligence (AI) infrastructure buildout.

Indeed, Susquehanna analyst Mehdi Hosseini is on the lookout for cracks in Micron's big gross and operating margin numbers: "While the durability of GM above 80% remains a central question," he writes "we believe the more important issue is whether OM can sustain a 70%-75% range over a multi-quarter — or even multi-year — period."

Hosseini's model shows normalization for margins beginning in fiscal 2028. "Nonetheless," the analyst concludes, "with annualized EPS potentially reaching $160 in FY27, we continue to see meaningful upside to the stock relative to our $1,750 price target."

What will FDX deliver on Tuesday?

FedEx (FDX, +1.2%) hasn't put up year-to-date gains quite like MU's, but it is among the top 10% of S&P 500 stocks so far in 2026 with a total return of greater than 40%. That performance through Monday was supported by recently raised guidance, as well as the completion of much of its corporate restructuring.

"While the market will naturally look for forward commentary," Stifel analyst J. Bruce Chan writes in a preview of FedEx's post-closing-bell turn on the earnings calendar this Tuesday, "we believe this print will be centered around: whether FedEx can deliver against its updated FY26 framework."

Chan, who reiterated his Buy rating and his $442 12-month target price for the industrial stock, will focus on the core Federal Express (FEC) parcel business and whether strength from last quarter carried through a more normalized non-peak quarter.

"Although the near-term print still includes several moving pieces," he concludes, "the larger outlook has improved materially, especially with the parcel business showing evidence of better revenue quality, stronger yield management, improved network efficiency, and more disciplined cost execution."

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If you're in the home stretch of saving for retirement, you'll generally hear that your shift into more stable assets like bonds should be gradual, and that you should continue to lean on stocks for the strong returns they've historically been known to deliver. In fact, if you're about a decade away from retirement, you may be inclined to keep a good chunk of your money in a broad mix of stocks to hit your target savings number and wrap up your career with a clear head.

But investors hoping for an upcoming period of strong returns may be in for disappointment. Some experts have been sounding the alarm that the stock market is in for a lost decade — meaning a decade of flat or considerably lower-than-average returns.

If you're banking on stock market growth to get to your retirement finish line, that's clearly bad news. Let's explore why the fear of a lost decade exists and whether you should or shouldn't believe the hype.

Stock values are super high

In late 2024, Goldman Sachs estimated that over the following 10 years, the S&P 500 would deliver an annualized nominal total return of 3%. When adjusted for inflation, that 3% drops to 1% in real terms.

Since then, experts have been on high alert for a decade of stagnant returns. And recent CAPE ratio values do paint a somewhat alarming picture.

The cyclically adjusted price-to-earnings (CAPE) ratio, also known as the Shiller P/E ratio, measures the value of the S&P 500 relative to the average of the previous 10 years of reported earnings, with those earnings adjusted for inflation. In contrast to the traditional P/E ratio, which relies on a single year of earnings, the CAPE ratio reduces the impact of short-term fluctuations, providing investors with a more stable and reliable view of the market.

In a nutshell, a higher CAPE ratio suggests the market is overvalued. A lower CAPE ratio suggests there's room for growth.

As of this writing, the CAPE ratio sits at roughly 42. The last time it rose that high was in the late 1990s, ahead of the dotcom peak.

Many investors remember the stock market imploding in 2000. But what's equally significant is that, following that crash, investors experienced a "lost decade" during which the S&P 500 produced little to no net growth. And given where the CAPE ratio is today, there's fear of a repeat.

Some of the fear may be unfounded

The idea of seeing little or no growth in your retirement portfolio can be scary. But before you panic, it's important to dig deeper.

Matthew Dicken, founder and CEO of Strategic Wealth Designers, makes the important point that concerns about high market valuations aren't exactly new, yet the market has continued to gain value.

"High valuations increase risk and may lower future returns, but they don't tell us when markets will reprice," he says.

Dicken also points out, "Markets rarely move in a straight line… A decade that ultimately produces average or below-average returns can still include periods of significant gains, corrections, and recoveries."

Frank Davis, President at New Era Financial, points out that while the CAPE ratio has historically been a useful indicator of future long-term returns, today's market is different from the one investors experienced in 2000.

"Many of the companies driving today's market gains are highly profitable businesses with strong balance sheets, substantial cash flow, and competitive positions, unlike the technology companies of the dotcom era, which were overhyped on the speculative immediate need," he explains.

Think back to the year 2000, when Pets.com became the symbol for burning millions on marketing without a clear path to profitability. The company went from a multi-million dollar Super Bowl ad to liquidation in under a year.

"Today's market leaders are generating real earnings and returning capital to shareholders," Davis continues, making them far less speculative than the internet darlings of the late 1990s.

What to do if retirement is 10 years out

A potentially overvalued stock market doesn't necessarily change the game plan for retirement savers who are only a few years or even a decade or so into their investing journeys. If you're roughly 10 years away from retirement, it's a different story.

But that doesn't mean you should resign yourself to a decade of absent returns or, worse yet, dump your stocks in a panic.

"The danger is that investors hear 'lost decade' and make drastic allocation changes that end up causing more harm than the risk they're trying to avoid," Dicken says. "No one has a crystal ball that works, so investors should focus on being properly diversified."

Davis agrees.

"Investors should not ignore today’s current valuation concerns," he says. "Too often, savers who are within 10 years of retirement lack diversification and are taking more sector risk than they should. The greatest risk may not be a major market crash, but rather a prolonged period of mediocre returns after a correction in one sector."

Dicken recommends constructing a portfolio that goes beyond stocks and bonds across various market sectors.

"Proper diversification includes other assets such as alternatives like private equity and private credit, annuities, precious metals, cash, and sometimes real estate," he says.

Dicken also says investors who are about a decade out from retirement may benefit from exposure to areas of the market that are trading at more reasonable valuations, including international stocks.

A holistic approach is best

If you're banking on your stock portfolio to deliver returns that mimic the past decade, it may be time to reset some expectations, Dicken says.

"Retirement plans built on 10% annual returns may need to be stress-tested using more conservative assumptions," he insists.

That said, Dicken thinks the best approach for the next 10 years isn't to predict market performance so much as to control the variables you can.

"That includes increasing savings rates, reducing unnecessary debt, maintaining adequate cash reserves, and ensuring [your] portfolio diversification extends beyond a handful of stocks and bonds," he explains.

Dicken also highlights the importance of preparing for an early market crash, known as the sequence of returns risk.

"A major downturn in the years immediately before or after retirement can have an outsized impact on portfolio longevity," he explains. "That's why investors should gradually build a portfolio designed not just for growth, but also for resilience."

Davis agrees, and thinks it's wise to maintain a reserve of conservative assets that could help reduce the impact of poor market performance.

Don't assume all is lost

All told, Davis says, there's no reason to assume the next 10 years will be a wash for stock market investors. Though history suggests that periods of lower returns are a normal part of the investment cycle, particularly when starting valuations are overly high, that doesn't mean the market is guaranteed to grossly underperform.

That said, Davis insists that successful retirement plans are not built on forecasts.

"Rather than attempting to predict the market's next big win, retirement savers are often better served by building a financial plan capable of weathering both strong and weak market environments," he says.

Read More

• 10 Years Until Retirement? Here Are 5 Investing Rules to Follow
• You’ve Mastered Asset Allocation — Now It’s Time for Asset Location
• I'm a Financial Planner: If You're Within 10 Years of Retiring, Do This Today
• 10 to 15 Years From Retirement? Time to Scale Back Risk

The Nasdaq Stock Market might be America’s second-largest stock exchange, behind only the 234-year-old New York Stock Exchange. But it's increasingly becoming the exchange of choice for Wall Street's best stocks.

Just take a quick glance at the S&P 500. The eight largest holdings are listed on the Nasdaq. Among them are Nvidia (NVDA), Apple (AAPL) and Microsoft (MSFT), a murderer's row of multitrillion-dollar firms and some of the market's top-rated equities.

In fact, if you homed in on the best Nasdaq stocks at any given moment, you'd be looking at companies in some pretty rarified air. And you'd probably also be a little surprised.

Although some of the Nasdaq's best stocks are the mega caps that have carried the broader market for some time, others are lesser-known names that attract fewer headlines but are nonetheless swarming with bulls.

Nasdaq ascendant

Another massive initial public offering (IPO), another feather in the cap for the Nasdaq.

Recent years have seen it capture some of the biggest IPOs of all time, including Rivian Automotive (RIVN), Cerebras Systems (CBRS) and Arm Holdings (ARM).

In June, it landed the greatest lunker of them all: SpaceX (SPCX). At $75 billion raised, the SpaceX IPO was the largest offering ever.

And it's not just new companies adding to the Nasdaq's appeal. Many of the world’s largest stocks are already aligned with the stock exchange.

The Nasdaq has managed to lure numerous mega-cap NYSE listings, including tech-related names such as Palantir Technologies (PLTR) and DoorDash (DASH) and also consumer staples stocks like Walmart (WMT), Kimberly-Clark (KMB) and Campbell Soup (CPB).

In other words, while the Nasdaq is still heavily concentrated in tech stocks, tech-adjacent companies and biotechnology names, the exchange has more breadth than you might appreciate.

How I picked the best Nasdaq stocks

First things first, I needed to whittle the Nasdaq's 4,000-plus equities to a more digestible universe.

To do that, I screened for stocks with the following characteristics.

• Trade on the Nasdaq Global Select Market, Nasdaq Global Market or Nasdaq Capital Market. These are three different tiers of the Nasdaq Stock Market covering large-cap stocks, mid-cap stocks and small-cap stocks, respectively.
• Have a market cap of at least $250 million. While I'm including large-, mid- and small-caps, I'm excluding micro- and nano-caps.
• Are incorporated in the United States. This is more for simplicity's sake—companies that report in different currencies can provide false positives in certain screens.
• Meet a few basic financial-quality criteria. We include companies that grew earnings last year, are expected to grow earnings at least 5% annually on average over the next three to five years and have a debt-to-equity ratio of less than 1.5.
• Have a consensus Buy rating. All of the stocks have an average broker recommendation of 2.5 or lower within the ratings scale established by S&P Global Market Intelligence. Anything with a score of 2.5 or lower is considered a Buy.
• Have at least 10 covering analysts. This ensures there's plenty of information and analysis available for these companies, and that consensus earnings estimates and ratings aren't skewed by one or two professionals.

From there, I identified the five highest-rated stocks across five different sectors. I didn't sacrifice quality to do so, either.

All five of the best Nasdaq stocks we talk about enjoy consensus "Strong Buy" ratings and fall within the 20 best-rated stocks on the entire exchange.

Data is as of June 14.

Amazon.com

• Sector: Consumer discretionary
• Market value: $2.6 trillion
• Dividend yield: N/A
• Consensus rating: 1.34 (Strong Buy)

Amazon.com (AMZN) is categorized as a consumer discretionary stock, but it's easily the most diversified company on this list, with hands in several sectors.

Amazon's businesses include its sprawling e-commerce empire, Amazon Web Services (AWS) cloud computing, Amazon Prime Video and Amazon Music streaming programming, Amazon Pharmacy, Kindle tablets, Echo smart speakers, Whole Foods grocery stores, Ring home security, Amazon MGM Studios production and distribution and so, so much more.

"We believe that AMZN merits a premium … given the company's growth in high-end offerings such as Prime and Prime Video; superior growth in AWS, digital advertising, and subscription services; and unmatched volume and vendor leverage,” says Argus Research analyst Jim Kelleher, who has a Buy rating on the stock.

Amazon is also getting involved with artificial intelligence (AI) through its AWS unit. Its Bedrock service, for instance, helps developers build generative AI applications.

As Wedbush analyst Dan Ives notes, Amazon's annual recurring revenue from AI has grown by approximately 260 times to more than $15 billion since Bedrock's launch.

"While AWS AI continues to see incremental demand," Ives writes, "customers are also leveraging AMZN's non-AI services for multiple capabilities including compute, storage, databases, analytics, security amongst others with AWS being named a leader across all cohorts."

Those are merely two of the 63 Buy calls on Amazon's stock, making it one of the largest bull camps on Wall Street. The only remaining calls are a quartet of Holds; no one, at least at the moment, is willing to call AMZN a Sell.

And despite Amazon's enormous size, at well more than $2 trillion in market cap, the pros still see the company generating robust average annual earnings growth of more than 20% over the next three to five years.

Meta Platforms

• Sector: Communication services
• Market value: $1.4 trillion
• Dividend yield: 0.4%
• Consensus rating: 1.31 (Strong Buy)

Meta Platforms (META) is the social media company, responsible for Facebook, Instagram, WhatsApp, Messenger and Threads. At the end of 2025, the company boasted 3.58 billion "daily average people" across its family of apps.

Meta, like Amazon, is one of the most-covered stocks on the planet, and those analysts are similarly bullish: Fifty-eight Buys dramatically outweigh a mere six Holds and no Sells. Projected long-term earnings growth of more than 20% a year backs those optimistic calls.

Noting that Meta has relied on ads to drive a compound annual growth rate for revenue of approximately 45% over the last 15 years, Truist analyst Youssef Squali emphasizes management's focus on building additional revenue sources so it can grow faster for longer. "These additional revenue sources are also meant to support the company's massive capex investment in pursuit of AI superintelligence," Squali observes.

But the communication services stock is down by double digits so far in 2026, most recently slipping on news that it also might be considering a multibillion-dollar sale of new shares to help finance those AI ambitions.

Indeed, META might represent the biggest question mark among the Nasdaq's best stocks right now. Argus Research analyst Joseph Bonner, for instance, has a Buy rating on the stock, but he also shares numerous reasons for caution.

"The year 2026 may be a make-or-break time for Meta's GenAI ambitions," he says. "The company has spent for talent, and the commitment of CEO Mark Zuckerberg and the company as a whole is palpable. However, Meta has yet to deliver a truly breakthrough model and will probably need to do something at least close to a breakthrough this year to maintain credibility in the AI space."

Allegro MicroSystems

• Sector: Information technology
• Market value: $9.3 billion
• Dividend yield: N/A
• Consensus rating: 1.25 (Strong Buy)

The Nasdaq's best-rated names are expectedly thick in technology stocks broadly and semiconductor stocks specifically–many of them bigger, more broadly known and better-covered than the top-rated stock in the space.

Allegro MicroSystems (ALGM) is a chipmaker that specializes in sensing, motion control and power management in electromechanical and power conversion systems. And it's increasingly focusing its efforts around four growth areas: advanced driver assistance systems (ADAS), robotics, electrification and industrial datacenters.

"The March-quarter print and June guide drive little change to numbers but reinforced the datacenter business as the most compelling growth pillar in the story," says Jefferies analyst Blayne Curtis. "The segment reached a record ~14% of total company revenue in Q4 and is tracking to grow 20%+ sequentially again in the June quarter to 16%-17% of total company sales, representing one of the highest relative exposures of Analog companies in our coverage."

Curtis also cites "one of the highest exposures to ADAS and xEV" in his bull thesis, and notes that while the automotive and industrial segments might have a little more weakness ahead, the company should "return to a [double-digit] revenue growth rate with increasing margins, given improving mix and efficiencies."

UBS's Timothy Arcuri says that after an in-line first-quarter report he still sees strong growth prospects and looks for fiscal 2027 and 2028 revenue growth in the mid-20s.

Jefferies and UBS aren't alone in their upbeat views. All 12 of ALGM's covering analysts call the stock a Buy, expecting the company to deliver 29% average annual bottom-line growth over the next three to five years.

Remitly Global

• Sector: Financials*
• Market value: $4.0 billion
• Dividend yield: N/A
• Consensus rating: 1.20 (Strong Buy)

Remitly Global (RELY) is an international money transfer company that provides digital financial services in the U.S. and roughly 170 other countries. The financial stock went public in September 2021, and it's spent the past couple of years expanding its offerings.

In 2025, it launched the Remitly One membership plan providing access to a host of products, including Remitly Flex, a no-interest "send now pay later" cash-advance product allowing for remittances up to $250; Remitly Wallet, a store-of-value product; Remitly Card, a digital debit card; and cash-back rewards. And it’s expected to launch a credit-building line of credit, Remitly Credit, this year.

RELY has been focused on expanding existing customer segments, too. June 2025 also saw the launch of Remitly for Business, a platform enabling businesses to pay employees, vendors and invoices that is predominantly focused on micro-businesses.

"Remitly has a small share of a massive, highly fragmented market; there are over 300 million immigrants and the global consumer-to-consumer cross-border payments market exceeds $2 trillion annually,” say William Blair analysts Cristopher Kennedy and Marc Feldman. "Market-share gains should be driven by expanding its presence into new geographic markets and by adding new users."

Remitly's stock has already climbed nearly 40% in 2026. However, Wall Street remains extremely bullish on the name, in part because of its potential long-term earnings growth, which analysts peg at 64% annually on average. All 10 covering analysts say RELY is a Buy, putting it among the Nasdaq's best stocks right now.

* The Global Industry Classification Standard (GICS), which publishes S&P Dow Jones Indices like the S&P SmallCap 600, classifies Remitly as a financial company. However, other data providers, such as Morningstar, classify it as a technology firm.

BrightSpring Health Services

• Sector: Healthcare
• Market value: $12.4 billion
• Dividend yield: N/A
• Consensus rating: 1.12 (Strong Buy)

The Nasdaq is known for hosting highflying biotech stocks whose novel treatments can trigger massive share spikes. However, the exchange's top-rated healthcare stock, while highflying, has nothing to do with developing drugs in a lab.

BrightSpring Health Services (BTSG) is a home- and community-based healthcare services company. Its Pharmacy Solutions platform includes pharmaceutical care to long-term care and assisted living facilities, at-home pharmaceutical care to oncology patients and specialty infusion services.

Its Provider Services arm offers home health care, hospice services, behavioral health, neuro-rehabilitation, a variety of personal care services, and even family and youth services such as counseling and foster care.

Wall Street believes its adjusted bottom line will jump by 68% this year, and that long-term earnings growth will come in around 46% annually on average. A team of Morgan Stanley analysts says growth is being driven by "a consistent playbook—strong volume underpinned by execution and quality, efficiency gains from scale and disciplined M&A," and management is applying it in large, underserved markets.

"Longer term," they write, "BTSG sees meaningful runway across a diversified set of end markets—including Oncology, Infusion, Behavioral and Home & Community—while maintaining a dual focus on driving core growth within each segment and increasingly integrating capabilities (e.g., VBC, tech-enabled solutions) to unlock incremental value across the platform."

Valuation has become a concern thanks to shares’ 70% year-to-date ascent, but the pros remain undeterred. All 17 covering analysts call BrightSpring a Buy.

"Shares trade at about 15.5 times our 2027 adjusted EBITDA estimate, toward the high end of healthcare services peers," William Blair's Jared Haase and Ryan Daniels wrote on June 3. "We believe the stock still presents an attractive risk/reward equation based on the growth momentum across the business and potential for further upside revisions to estimates."

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Stocks gapped up at the opening bell on Thursday and ended a holiday-shortened week on an upbeat note after the U.S. and Iran reached an agreement that opens the Strait of Hormuz on a provisional basis for 60 days.

The prospect of peace in the Middle East and relief from an energy shock revived animal spirits dulled by Federal Reserve Chair Kevin Warsh's hints of higher interest rates during the press conference after the first Fed meeting of his tenure.

By the time the closing bell rang, the blue-chip Dow Jones Industrial Average was up 0.1% for the day and 0.7% for the week at 51,565, good enough for another new all-time weekly closing high.

The S&P 500 had added 1.1% at 7,500, bringing the broad-based index to a 0.9% gain for the week. The tech-heavy Nasdaq Composite was up 1.9% on Thursday and 2.4% for the four days at 26,517.

The front-month West Texas Intermediate crude oil futures contract declined by 0.4% to $75.71 per barrel. WTI was down more than 10% this week and is now just 13% above its closing price on February 27, the day before the war in the Middle East began.

The 2-year Treasury yield ticked up to 4.177% from 4.163% on Wednesday. This market-based barometer of short-term interest rates hit a 52-week high on Thursday.

Following its two-day meeting this week, the Fed held the federal funds rate steady at 3.50% to 3.75%. Its short statement concluded with a firm commitment to the inflation half of its dual mandate: "The Committee will deliver price stability."

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As Louis Navellier of Navellier & Associates notes, Warsh "was perceived as more hawkish than hoped for" during his first (and maybe last) FOMC press conference.

"The commentary Warsh gave made it clear that, currently, unless inflation falls much closer to the 2% target, which he made clear would not be changed, a rate hike was likely by year's end," Navellier concludes.

You can catch up on news and developments around the FOMC meeting at our June Fed meeting blog.

Apple and Intel are making a deal

Intel (INTC, +10.6%) was among the top-performing S&P 500 stocks on Thursday, and Apple (AAPL, +0.7%) was higher, too, after President Donald Trump posted about a big deal between the two iconic American companies early Thursday morning.

"Apple has agreed to work with Intel to design and build its Chips in America," Trump said in a lengthy post on Truth Social. "The Technology the World relies on was invented in America," he began. "We all remember 'Intel Inside.'"

Indeed, we do, and the president wants to undo the work of his predecessors who allowed "Taiwan and others [to] steal our Semiconductor Factories" and "forgot to protect our Industries with TARIFFS."

Neither Intel nor Apple confirmed the president's post, though The Wall Street Journal reported on May 8 that the companies had reached a preliminary chipmaking agreement.

Elsewhere in an otherwise rapidly expanding tech universe, SpaceX (SPCX, -3.6%) posted a second straight down day amid the afterburn from the biggest IPO ever.

Big Blue has no bounce

International Business Machines (IBM, -5.1%) was the worst-performing Dow Jones stock on Thursday, sliding along with Accenture (ACN, -16.3%) after the fellow IT services provider shared worse-than-expected top-line guidance for its full fiscal year, citing operating conditions in the Middle East.

CEO Julie Sweet said during the tech stock's conference call that the war was impacting spending plans for many of its clients. Management also noted market concerns about the impact of artificial intelligence (AI) on its business.

Accenture now expects to see revenue growth of 3% to 4%, down from an estimate of 3% to 5% in March. ACN stock had its worst day on record on Thursday.

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The main equity indexes were moving sideways through midday on Wednesday, as markets awaited word from the new leader of the world's most important central bank about inflation, interest rates and economic growth. All three fell sharply following the release of the first FOMC policy statement under the leadership of new Fed Chair Kevin Warsh.

Maybe it's a little too simple, maybe it's not when the new chair is as loudly committed to keeping a tighter lid on Fed communications as this one is, but the Federal Open Market Committee used 344 words to announce a historically split decision following its April meeting, the final one under Jerome Powell's leadership.

Today, the FOMC approved a 132-word statement to announce a unanimous 12-0 decision to hold the target range for the federal funds rate steady at 3.50% to 3.75% "in support of the Federal Reserve's dual mandate." The FOMC also "reaffirmed its policy of maintaining ample reserves in the banking system."

Economic growth is solid "despite elevated uncertainty that owes, in part, to the conflict in the Middle East," with strength in productivity and capital investment. Job growth is keeping up with labor force growth, and the unemployment rate is steady.

Noting that inflation is above the Fed's 2% target "in part reflecting supply shocks that have driven price increases in certain sectors, including energy," the Warsh Fed delivered a terse conclusion: "The Committee will deliver price stability."

You can catch up on news and developments around the FOMC meeting at our June Fed meeting live blog.

Will the Fed raise the federal funds rate?

Market-based interest rates were up across the maturity spectrum, with the 2-year Treasury yield, widely watched as a gauge of short-term policy, rising to 4.216% from 4.047% on Tuesday.

CME FedWatch, which tracks the probability of rate cuts and rate hikes based on 30-day fed funds futures prices, indicates the Warsh Fed could raise interest rates as soon as October.

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Continuing uncertainty about the details of a memorandum of understanding between the U.S. and Iran that would open the Strait of Hormuz lifted the front-month West Texas Intermediate crude oil futures contract by 0.3% to $75.49 per barrel.

By the closing bell, the blue-chip Dow Jones Industrial Average had declined by 1% to 51,493, despite reaching another new all-time high on an intraday basis. The broad-based S&P 500 was down 1.2% at 7,420, and the tech-heavy Nasdaq Composite was off 1.3% at 26,021.

AVGO is an 'aggressive buy'

Broadcom (AVGO, +4.3%) led a rally for semiconductor stocks after Morgan Stanley analysts Harlan Sur and Mayur Ramdhani reiterated their Overweight (Buy) rating and said they'd be "aggressive buyers at current levels."

Indeed, the analysts see potential upside of 47.6% from AVGO's closing price on Wednesday based on their 12-month target price of $580. And it'll get there because of its "significant dominance" in advanced chip packaging and design.

Sur and Ramdhani note that Broadcom has helped Alphabet's (GOOGL, -2.5%) Google unit develop 14 advanced chips during a decade-long partnership, though markets have questioned the durability of that arrangement given Alphabet's ambitions to take chipmaking in-house.

AVGO was down 21.8% from its all-time closing high of $481.57 on June 2 through June 16, trimming its year-to-date gain to 9.1%. But Broadcom's trailing-12-month return is back well above 50% after today's price action.

Did a defensive stock take a SPCX hit?

Verizon Communications (VZ, -1.8%) is one of the best defensive stocks amid elevated uncertainty, but it does face rising competitive pressure from one of the hottest names in the market: SpaceX (SPCX, -5.0%).

UBS analyst John Hodulik framed the problem at a conference in December in a three-part question to CEO Greg Sankey of Verizon's "terrestrial" mobile service peer AT&T (T, -3.0%) about "low Earth orbit" service providers.

"Do you see LEO infrastructure as a complement or a substitute to terrestrial networks? How do you expect the business model of the LEO providers to evolve over time? And is it something that we should worry about as terrestrial mobile investors?"

AT&T and Verizon aren't staying Earth-bound, but they are using AST SpaceMobile (ASTS, +3.9%) rather than SpaceX unit Starlink to pursue their extraterrestrial ambitions. And AST lacks launched satellite capacity right now.

Hodulik reiterated his Neutral (Hold) rating on VZ stock and a $48 12-month target price after management introduced new service and device plans on June 15, as well as a loyalty program focused on customer retention.

Verizon expects the plans and the program "to be accretive to revenue and EBITDA growth and drive continued churn reduction." Management also confirmed its full-year financial guidance.

SPCX stock, meanwhile, had its first down day as a publicly traded company, three trading sessions after it debuted with the biggest IPO ever.

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Blue chip stocks emerged as the clear winners Tuesday, with strong gains in several high-priced names sending the Dow Jones Industrial Average to a new record high. But weakness in the tech sector kept pressure on the S&P 500 and Nasdaq Composite.

After trading above 52,000 in intraday trading, the Dow closed up 0.6% at 51,999, its highest settlement ever. JPMorgan Chase (JPM, +3.7%) and Visa (V, +2.9%) were the best Dow Jones stocks today. With JPM trading at $331 per share and V at $333 per share, these two have an outsized influence on the price-weighted Dow.

Today marks the Dow's first foray above 52,000 — which happened just 12 trading days after it climbed above the 51,000 level for the first time. According to Dow Jones Market Data, this is the shortest amount of time the 30-stock index has taken to cross two 1,000-point thresholds since March 2021, when it took five days to rise from 32,000 to 33,000.

But the broader S&P 500 fell 0.6% to 7,511 and the tech-heavy Nasdaq slumped 1.2% to 26,376 as several of the market's recent highfliers sold off.

Intel (INTC), for one, slumped 8.5%, but remains 220% higher for the year to date. Lumentum Holdings (LITE, -8.6%) and Marvell Technology (MRVL, -9.8%) also closed with sizable losses, but have still tripled in price this year.

SpaceX briefly rockets past Amazon's market cap

One notable tech stock that finished in positive territory today was SpaceX (SPCX). Shares jumped 4.8% on news that Elon Musk's satellite and space exploration company is buying AI coding startup Cursor for $60 billion. SPCX stock is now trading nearly 50% above the $135 initial public offering (IPO) price.

The stock went public last Friday in the biggest IPO ever, and its first-day surge gave the company a market valuation of more than $2 trillion. Today's pop puts its market cap at $2.642 trillion — just below Magnificent 7 stock Amazon.com (AMZN, -0.04%) and its $2.646 trillion valuation. (SPCX briefly topped AMZN's market cap intraday.)

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SpaceX remains the sixth-largest U.S. company by market cap.

Oil prices continue to drop ahead of U.S.-Iran peace deal

While technology (-2.3%) was the biggest decliner of the 11 S&P 500 sectors today, energy (-0.3%) also saw notable losses as oil prices continued to decline.

Front-month West Texas Intermediate crude futures fell 5.8% to $76.05 per barrel — their lowest close since March 3.

This comes after the U.S. and Iran agreed to sign a peace plan this Friday, and President Donald Trump said that the Strait of Hormuz will reopen.

"The persistent slide in crude oil prices, which accelerated this week following positive U.S.-Iran developments, is incredibly bullish for markets," says José Torres, senior economist at Interactive Brokers.

He adds that the sharp decline in energy costs ahead of this week's Federal Reserve meeting — the first for new Chair Kevin Warsh — "offers favorable first-impression dynamics and raises the likelihood of an increasingly patient central bank willing to look through the current short-term inflation as a one-time shock."

How will markets react to a Warsh-led Fed?

If Warsh is "perceived as more dovish than expected, it should be bullish for stocks," says Louis Navellier of Navellier & Associates. "If he's hawkish, it could bring volatility."

It's all but expected that the Federal Reserve will keep interest rates unchanged tomorrow, given that the labor market remains steady even as inflation has accelerated.

But market participants will be eyeing the Summary of Economic Projections (SEP) and dot plot to see where the Warsh-led Federal Open Market Committee (FOMC) expects the federal funds rate, unemployment rate and inflation rate to be over the short and long term.

You can follow along with the latest news and updates on the June Fed meeting on our live blog.

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Stocks jumped out of the gate and stayed higher through the close as market participants cheered news of potential peace in the Middle East. Oil prices, meanwhile, cratered as reports of a deal to end the months-long war circulated, though the Federal Reserve is still likely to stay on hold at this week's meeting.

Over the weekend, Pakistani Prime Minister Shehbaz Sharif announced on X "that the Peace Deal between the United States of America and Islamic Republic of Iran has been REACHED." President Donald Trump later confirmed the news.

"The Deal with the Islamic Republic of Iran is now complete," Trump wrote in a post on Truth Social. In a separate post, the president noted that the Strait of Hormuz will be open "upon the signing of the Deal on Friday."

Oil prices fell as a result, with front-month West Texas Intermediate crude futures tumbling 4.9% to $80.75 per barrel — their lowest settlement since early March.

Stocks, on the other hand, soared. The blue-chip Dow Jones Industrial Average was up 0.9% at 51,671 — a new record closing high — the broader S&P 500 was 1.7% higher at 7,554, and the tech-heavy Nasdaq Composite had jumped 3.1% to 26,683.

Sinking oil prices won't change the Fed's path this week

The Federal Reserve will kick off its June policy meeting tomorrow and deliver its first statement under the leadership of new Chair Kevin Warsh on Wednesday afternoon.

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Spiking oil prices as a result of the war in Iran have accelerated inflation, putting the chances for rate cuts this year at zero. And while energy prices are down from their wartime highs, it's unlikely the Federal Open Market Committee will lower the federal funds rate anytime soon.

However, what this does is quiet calls for rate hikes, which have increased in recent weeks.

Roku drops despite $22 billion buyout offer

In single stock news, Roku (ROKU) fell 1.9% even after Fox (FOX, -15.2%) said it will buy the streaming device maker in a cash-and-stock deal valued at $22 billion, or $160 per ROKU share — a more than 11% premium to the stock's June 12 close.

Typically, stocks rise to the per-share offer once the offer is announced, but Roku surged nearly 23% on Friday on rumors of a potential buyout so some of the premium was already priced in.

TD Cowen more than doubles its Micron price target

Micron Technology (MU) was on the positive side of the ledger today, surging 10.8% after TD Cowen analyst Krish Sankar reiterated a Buy rating on the red-hot chip stock and lifted his price target to $1,500 from $660. This new target price represents implied upside of 38% to current levels.

Sankar believes demand for the memory chipmaker's products will help pricing strength "persist into the second half of calendar year 2027." Additionally, he sees Micron's role in artificial intelligence as "structural, not cyclical," which will provide a tailwind for earnings over the next several years.

Micron will report its fiscal third-quarter results after the June 24 close and Wall Street is expecting revenue to rise nearly fourfold from the year prior and earnings to surge to $19.69 per share from $1.91 per share.

SpaceX soars in first full trading day

SpaceX (SPCX) also had a strong showing in its first full session. After closing Friday more than 19% above its IPO price, SPCX stock finished Monday up 19.6% at $192.50.

The SpaceX IPO "has reinvigorated the tech trade," says Louis Navellier of Navellier & Associates. "The success of such a huge IPO, now valued at $2.26 trillion, paves the way for the other outsized IPOs in the pipeline: Anthropic and OpenAI."

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