While last week’s stock market pullback was noted, the S&P 500 Equal-Weighted Index’s positive advance supports broader market participation, which is skewed by the cap-weighted index. Sowell’s technical gauges remain fully invested.
You know the scene in every heist movie where the crew finally cracks the vault, reaches in for the diamonds, and discovers someone already cleaned it out. That's roughly what happened to tech investors last week. They showed up expecting the usual AI-fueled treasure — chips, capex, infinite upside — and instead found the vault stripped bare by an unlikely culprit: memory. Not the kind you lose with age. The kind that goes into your iPhone, your Xbox, and apparently, the entire bull case for AI hardware margins.
By Friday, the Nasdaq Composite had logged its 5th straight losing session, closing down 4.59%. The S&P 500 fell a modest 1.94%. Both indexes are still standing, but not the expected outcome after the recent US-Iran ceasefire. It was a mixed scorecard:
As 10-yr Treasury Yield: Slipped 8 basis points on the week to roughly 4.38%, as a benign inflation print took some hawkish edge off the bond market.
Gold: Down about 3% for the week — its fourth consecutive weekly decline — as a resilient dollar and a hawkish Fed kept bullion out of favor.
Crude Oil (WTI): The week's biggest mover of all, sliding 5.28% to settle at $71.53, its third straight weekly drop, as tankers resumed moving through the Strait of Hormuz and Iranian oil supply edged back toward the global market.
Everyone, it seems, found a reason to sell something last week — they just couldn't agree on what.
Main Catalyst: The Chip Sell-Off
Semiconductor and AI-adjacent names took it on the chin again last week, as the PHLX Semiconductor Index fell 7.9% over the past 5 days, led by NVIDIA (-8.6%). The proximate trigger was twofold. First, Apple raised prices across nearly its entire hardware lineup this week: Macs, iPads, the Vision Pro, HomePods, Apple TV. Some increases ran into the hundreds of dollars. Microsoft followed within hours, hiking Xbox console prices by $100 to $150, effective August 1st — the third such increase in just over a year. Both companies pointed to the same culprit: a historic shortage of memory and storage chips, with DRAM and NAND prices having roughly quadrupled over the past three quarters as AI data centers buy up the global supply.
You'd think “Apple and Microsoft can finally charge what their margins demand” would read as bullish. It did not. Apple shares fell more than 4%. Microsoft also dropped nearly 4%. The damage didn't stop at two stocks. It dragged down the two sectors that own them. Technology was the week's worst-performing group in the S&P 500, and Communication Services slid right alongside it, dragged down by the same margin-pressure read.
Then there were reports that OpenAI may delay its IPO into next year, citing volatility in AI-related shares and concerns about the durability of infrastructure spending if capital-markets funding doesn't materialize on schedule. That's the financial equivalent of someone in line ahead of you at the bank suddenly deciding they need a loan extension — everyone behind them starts sweating, too.
The S&P 500 Equal Weight index and several non-tech sectors have held up far better than their cap-weighted cousin, suggesting this is healthy rotation rather than a market-wide loss of nerve. Healthcare has gained 7.91%, while the S&P 500 EW index has gained 1.60%.
Healthcare and Financials told a completely different story, and a more comforting one for anyone tired of a market that lives and dies by Big Tech's mood. Healthcare was the week's best-performing sector by a wide margin, powered by M&A activity (Merck's bid for Bio-Techne, up more than 22% on the news) and strength in names like Incyte, up over 15%. Financials posted modest gains as well, helped by a steepening-adjacent macro backdrop: oil's collapse is disinflationary, easing some of the pressure that's been weighing on rate-sensitive lenders, and the sector's valuations look comparatively cheap next to a tech complex that just got a vivid reminder of its input-cost risk.
Bond Market's Surprisingly Calm Week
Friday's PCE inflation report came in essentially as expected — headline inflation at 4.1%, core at 3.4%, the hottest core reading since 2023, but matching forecasts almost to the decimal. In a world bracing for a hawkish surprise, “as expected” was treated as good news, and Treasury yields eased modestly on the week.
New Fed Chair Kevin Warsh, fresh off his first meeting at the helm, has kept rates unchanged, and markets are now pricing in the possibility of hikes later this year rather than the cuts that seemed inevitable not long ago. It's a strange position for the bond market to find itself in — debating whether the next move is up, not down — and it's keeping yields elevated even as individual data points come in tame.
The Week Ahead
Markets get a four-day week, with Thursday closing out before the July 4th holiday on Friday. Don't let the short week fool you — it's stacked.
Tuesday: Consumer confidence, May JOLTS job openings, plus earnings from Nike and Constellation Brands.
Wednesday: ADP private payrolls, June ISM Manufacturing PMI, construction spending, and General Mills earnings.
Thursday: The big one — June nonfarm payrolls, released a day early because of the holiday. Consensus sits around 172,000, but after blowout prints in April and May, the real story will be whether hiring is genuinely cooling or just taking a quarter-end breather. A hot number revives hike chatter; a soft one gives Warsh's Fed room to sound less combative.
With official Q2 earnings season still a couple of weeks out, this week's data — particularly payrolls — will do most of the talking. Combine a still-resilient labor market with a Fed Chair who's already signaled no patience for premature easing, and the bond market's calm this week could prove to be the eye of the storm rather than the all-clear.
Enjoy the fireworks. Markets might provide a few of their own.
"You may or may not lose a job to an AI. But you will absolutely lose a job to someone who uses A.I."
— NVIDIA CEO Jensen Huang, Sequoia Capital Host Jensen Huang on Building the Dynamo of the Intelligence Age, June 10, 2026
You Can Have Your A.I. Cake and Eat It Too
By Alex Hsiao (someone who uses A.I.)
There is a particular kind of confidence that only comes from being the only person in the room who knows exactly how much electricity you need. Jensen Huang has that confidence. He wears it the way he wears his black leather jacket — not as a costume, but as a load-bearing structural element. So, when the Nvidia CEO sat down with Sequoia Capital’s Konstantine Buhler for the firm’s “Training Data” fireside chat, which we encourage you to watch (https://youtu.be/2UpQbeAZuqA?si=c5pfP9LoloCHXvIK), he didn’t reach for a chart. He reached for dessert to explain A.I.’s industrial layout.
AI, Huang explained, is like a five-layer cake. Bottom to top: energy, chips, infrastructure, models, applications. It’s the kind of metaphor that sounds almost insultingly simple for a man presiding over what may be the largest industrial buildout in human history — and that’s rather the point. Huang has built a career on making trillion-dollar capital expenditures sound like something you could explain to your nephew at Thanksgiving. The trick of the metaphor or manifesto, though, is that it’s doing double duty. It’s selling investors on a stack. And it’s selling everyone else on the idea that the cake gets big enough for all of us to have a slice — workers included.
The recipe
Start at the bottom. Base tier is the foundation of energy, the unglamorous, unphotogenic flour of the operation — no electricity, no intelligence. Huang’s argument is that the AI revolution is, before it’s anything else, a power problem wearing a software costume. Layer two is chips, which is conveniently the layer Nvidia happens to dominate, converting all that energy into compute the way a generator turns gasoline into something a house can actually use. Layer three is infrastructure: the data centers, the cooling, the networking that lets thousands of processors function as one continuous brain instead of a very expensive space heater. Layer four is the models themselves — the OpenAIs, the Anthropics, the Geminis — doing the thinking. And layer five, the buttercream on top, is applications & products: the moment a hospital, a law firm, or a self-driving car turns all that infrastructure into something a customer will actually pay for.
The insight, dressed up as a baking tip, is really a thesis about where the money goes and why none of it works in isolation. You cannot frost a cake that hasn’t been baked, and you cannot monetize a model that has nowhere to run. Every layer pulls demand from the one beneath it, all the way down to the literal power plant. That’s the closed loop Huang is selling investors: build the foundation, and the applications — drug discovery, industrial robots, digital agents — arrive not as speculation but as the inevitable next course.
It’s also, not coincidentally, a map of where Nvidia sits at nearly every table setting. Chips, check.
Infrastructure, increasingly check. The skeptical reader — and investment columnists are contractually required to be skeptical readers — might notice that the man explaining the cake also owns the bakery, supplies the ovens, and would very much like you to order a second cake.
The part where everyone panics about jobs
But the cake metaphor is just the warm-up act. The real argument is what happens to the humans once the cake is built. And this is where the “have it and eat it too” framing earns its keep, because his pitch isn’t just that investors get the upside. It’s that workers do too, simultaneously, without the usual trade-off.
The prevailing fear, the one circulating dinner parties and earnings calls alike, is that AI eats jobs the way a toddler eats cake — indiscriminately, without regard for what was supposed to be saved for later. Huang’s counter hinges on a distinction he repeats like a mantra: a job is not a task. A radiologist’s job isn’t “stare at scans.” A software engineer’s job isn’t “type code.” Those are tasks, and AI is unambiguously coming for the tasks. What’s left over — judgment, context, the parts of the job that were the actual point of hiring a human — tends to expand to fill the space the automated tasks vacate. You don’t lose the job. You lose the boring 60% of it.
His evidence isn’t hypothetical. Nvidia and its ecosystem have poured roughly a trillion dollars into this buildout — energy, chips, infrastructure, models, applications — and every layer needs electricians, welders, construction crews, and chip-fab technicians who don’t currently exist in sufficient numbers. Huang has pointed to roughly half a million such jobs created just from the physical construction side: the unglamorous, unautomatable work of pouring concrete for the buildings that will house the very systems supposedly coming for everyone’s livelihood. There’s a tidy irony there that even Huang seems to enjoy — the robots need plumbers.
His sharper, more uncomfortable line — the one that should probably hang in every HR department — is that you likely won’t lose your job to AI. You’ll lose it to the colleague two desks over who learned to use it competently while you were busy writing op-eds about whether you should learn to use it. Huang’s view, echoed by Nvidia’s own hiring data, which shows more software engineers added than subtracted, is that productivity gains don’t shrink headcount — they shrink the cost of being productive, which makes companies want more of it, not less. If an AI-augmented engineer can generate outsized output, the rational move isn’t to hire fewer engineers. It’s to hire more of them and let them do more. That’s the cake-and-eat-it-too logic in miniature: the company gets the productivity, and the worker — provided they show up to the buffet — gets to keep their seat at the table, just with a bigger plate.
The skeptic’s slice
None of which means Huang is right, or that he’s a disinterested narrator. He’s the platform vendor at the bottom of the cake insisting the cake is delicious and that everyone should keep ordering more layers. The Industrial Revolution analogy he and his fellow optimists lean on did, eventually, create more jobs than it destroyed — but “eventually” covered a few rough decades for the people standing closest to the looms, who were not especially comforted by long-run GDP charts at the time. Critics of the bubble thesis also note that a trillion dollars in capex is a trillion dollars of bets that need very large, very fast returns to pencil out, and “trust the closed loop” has never been a foolproof investment strategy on its own.
Still, give Huang this much: he’s at least offering a framework, not just a vibe, and a theory of the workforce that’s more specific than “don’t worry about it.” Whether AI turns out to be the Industrial Revolution like electricity, automobiles, computers, or the world’s most expensive layer cake left out in the rain remains, as always, a matter for the next quarter’s earnings call. Bring a fork either way — just don’t assume there’ll be a slice with your name on it if you never learn to ask for one.
Advisory services offered through Sowell Management, a Registered Investment Advisor. The views expressed represent the opinion of Sowell Management. The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Stated information is derived from proprietary and non-proprietary sources that have not been independently verified for accuracy or completeness. While Sowell Management believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability. Statements of future expectations, estimates, projections, and other forward-looking statements are based on available information and Sowell Management’s view as of the time of these statements. Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such statements. Investing in securities involves risks, including the potential loss of principal. While equities may offer the potential for greater long-term growth than most debt securities, they generally have higher volatility. International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, or from economic or political instability in other nations. Past performance is not indicative of future results.
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WEEK AHEAD
June 29-July 3, 2026
Weekly Market Commentary:
Apple Lifts Prices, Tech Stocks Fall
Main Catalyst: The Chip Sell-Off
Bond Market's Surprisingly Calm Week
The Week Ahead
"You may or may not lose a job to an AI. But you will absolutely lose a job to someone who uses A.I."
— NVIDIA CEO Jensen Huang, Sequoia Capital Host Jensen Huang on Building the Dynamo of the Intelligence Age, June 10, 2026
You Can Have Your A.I. Cake and Eat It Too
By Alex Hsiao (someone who uses A.I.)
The recipe
The part where everyone panics about jobs
The skeptic’s slice
Advisory services offered through Sowell Management, a Registered Investment Advisor. The views expressed represent the opinion of Sowell Management. The views are subject to change and are not intended as a forecast or guarantee of future results. This material is for informational purposes only. It does not constitute investment advice and is not intended as an endorsement of any specific investment. Stated information is derived from proprietary and non-proprietary sources that have not been independently verified for accuracy or completeness. While Sowell Management believes the information to be accurate and reliable, we do not claim or have responsibility for its completeness, accuracy, or reliability. Statements of future expectations, estimates, projections, and other forward-looking statements are based on available information and Sowell Management’s view as of the time of these statements. Accordingly, such statements are inherently speculative as they are based on assumptions that may involve known and unknown risks and uncertainties. Actual results, performance or events may differ materially from those expressed or implied in such statements. Investing in securities involves risks, including the potential loss of principal. While equities may offer the potential for greater long-term growth than most debt securities, they generally have higher volatility. International investments may involve risk of capital loss from unfavorable fluctuation in currency values, from differences in generally accepted accounting principles, or from economic or political instability in other nations. Past performance is not indicative of future results.