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Iran rattles stocks… 91¶¶Òõ and Keith Kaplan’s read on the memory trade… why SpaceX’s next leg up won’t mean what you think…
It was another violent weekend in the Middle East, with the U.S. and Iran trading a wave of strikes rather than settling into the calm both sides promised weeks ago.
The flashpoint remains the Strait of Hormuz…
The Trump administration had expected Iran to publicly declare the waterway open and toll-free. Instead, Tehran did the opposite, closing it and blaming the U.S. for the violence that disrupted traffic in the first place.
Iran’s strikes hit U.S. allies across the Gulf, targeting positions in Kuwait, Bahrain, Qatar, Jordan and Oman.
On Truth Social, President Trump posted that he has reimposed the blockade on the Strait of Hormuz, and said the U.S. would effectively take over management of the strait:
We are reinstating the IRANIAN BLOCKADE, so named because it is only stopping Iran’s ships or customers from entering or leaving.
The U.S.A. will be, from this point forward, known as ‘THE GUARDIAN OF THE HORMUZ STRAIT,’ 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.
Crude prices rose on the news, with both Brent and West Texas Intermediate up almost 5% as I write.
However, stocks are taking it in stride. Here at midday, the Dow is barely lower, and the S&P 500 is modestly down. Only the Nasdaq is showing real stress, off about 1%.
Why the muted reaction given the headlines?
Because Wall Street still believes the conflict will stay contained.
At this point, we’ve seen enough of these strikes followed by de-escalations to bank on the coming ceasefire. Until that assumption breaks, investors seem willing to look through the noise.
Meanwhile, there’s more behind the Nasdaq’s underperformance this morning than Middle East headlines
Semiconductor stocks are getting hit hard – again – and it’s all linked to one name: South Korean chipmaker SK Hynix (SKHY).
It’s down 6% as I write after making its U.S. trading debut last Friday. That’s a sharp reversal from its 13% pop last week – and it’s dragging down U.S. memory and chipmakers.
Bloomberg points toward fears that SK Hynix won’t deliver on earnings after investors flooded into the IPO:
[The pullback underscores] growing investor concerns that the boom is overextended…
Traders pointed to fears of lower-than-expected earnings…
Even amid recent concerns over stretched AI valuations and high spending levels, the deal was more than seven times oversubscribed, according to people familiar with the matter.
Now, while some on Wall Street are looking for cover today, legendary investor 91¶¶Òõ sees this collateral damage on U.S. chipmakers as a buying opportunity.
From his Flash Alert this morning:
SK Hynix Inc. (SKHY), the big memory company that went public last week, gapped up on Friday and is consolidating today. The Korean stocks are pretty manic.
So up, down, up, down, up, down. That will make Micron Technology, Inc. (MU) do the same thing, but Micron is a good buy on any pullback, and today would be another good example of that.
A more systematic way to play that “up, down” chip volatility
Louis is trading the fundamentals here – buying Micron on the dip because he trusts the long-term memory story regardless of the day-to-day noise.
But our friends at TradeSmith are looking at that same “up, down, up, down” pattern through a totally different lens…
CEO Keith Kaplan isn’t looking at earnings, Fed policy, or the AI narrative to decide where the trade goes next. He’s looking at the calendar.
Keith’s team has built software that scans more than 5,000 stocks across decades of price history, hunting for one thing: windows of time when a stock has historically gone up – or down – with remarkable consistency.
He calls the bullish stretches “green days,” and in backtesting, the approach has flagged these windows with an 83% historical accuracy rate.
Run through an 18-year backtest, trading only inside these windows produced 857% in total growth – more than double the S&P 500 over the same stretch, and the strategy still came out ahead even in 2007, the worst year in the test.
It’s the same logic commodity traders have used for planting and harvest cycles, or gold traders have used around Indian and Chinese jewelry-buying seasons — just applied with more precision, stock by stock, day by day.
By that measure, Western Digital (WDC) – one of the oldest names in computer storage, and now a critical supplier to AI data centers – is sitting in one of its green windows right now.
This green window opened on July 1 and runs through July 22. Over the past 15 years, the stock has risen 86.7% of the time during that stretch.
Want to know when your stocks will be in their own green days?
A free trial of TradeSmith’s Seasonality tool is available so you can find out.
It’s available in the run-up to Keith’s event that’s happening this Thursday, July 16, at 10 a.m. ET.
Here’s Keith:
You can try out our software on the stocks you own with this free, limited-time trial version.
We’ve unlocked access so you can .
At the event, Keith will lay out why he believes the period beginning around July 23 could mark an important shift in market leadership – the kind of turn that rewards investors who know exactly when to be positioned, not just what to own.
I’ll note that Louis will join him, explaining how he’s pairing Keith’s timing signals with his own stock-grading system to identify both what to buy and when to buy it.
Attendees walk away with three free stock recommendations Keith believes are positioned for what’s ahead – plus one he says to avoid entirely.
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Another IPO story – and another prediction
SK Hynix’s swings over the last two sessions are a reminder that a hot IPO can move a stock for reasons that have little to do with what’s happening at the company.
Nowhere is that truer than with the biggest IPO of the year, which we’ve been tracking in recent weeks: SpaceX (SPCX)
Here’s a new prediction: it’s going higher from here.
But here’s a twist: it’ll have very little to do with SpaceX being a good investment.
Before SpaceX’s historic IPO last month, we urged readers to stay away. Behind the warning was 45 years of U.S. IPO history – compiled and analyzed by University of Florida professor Jay Ritter, who is the world’s foremost academic authority on IPOs.
In short, the average investor wasn’t going to be able to buy SPCX at its initial IPO price. And the data suggested that after an early surge (during which the average buyer would eventually get in), the stock would experience a meaningful pullback, leaving many investors underwater.
That’s exactly how it played out…
In the days following its IPO, SPCX jumped to an all-time intraday high of $225.64. But then heavy selling pressure and a major $20 billion public bond offering dragged shares down.
Last Wednesday, SPCX fell below that $150 opening price. And as I write on Monday, it’s trading below $140 – meaning nearly every buyer since the open is now underwater.
So, what happens now?
Well, it’s our strangest forecast yet…
SPCX is probably going up – but once again, you’ll want to be careful about buying in.
What’s coming, why, and why smart investors will remain cautious
On July 7, SPCX joined the Nasdaq-100, forcing every fund tracking the index to buy shares. But that wave was the small one. SpaceX floated only about 5% of its shares in the IPO, so despite a market cap rivaling Amazon’s (AMZN), its index weight sits at roughly 1.3% today.
That will change…
Lockups begin unwinding this summer in tiers – with large freed-up tranches coming through the fall. As the float grows, so does SpaceX’s index weight. Some analysts expect it could approach a 4% weighting – a top 10 spot in the Nasdaq-100 – by mid-August.
Every step up in weight forces another round of buying from funds that have no say in the matter.
Even permabear Jeremy Grantham – who called this “the craziest IPO in the history of man” – admits the math means the price could climb “a lot” from here, valuation be damned.
What that rising share price will not reflect – profitable earnings
Watch for the coming rally to get sold to everyday investors as vindication – proof that the market “believes” in SpaceX.
But that story is misleading. It’ll be index funds fulfilling a legal obligation.
Here’s what you can believe…
SpaceX posted a $4.3 billion net loss in the first three months of 2026 alone, on top of an accumulated deficit – the running total of losses since the company’s founding – of $41.3 billion. Meanwhile, it’s carrying $29.1 billion in long-term debt, including a $20 billion bridge loan.
Its AI segment (xAI/Grok) lost $6.4 billion last year while burning through billions more in capex.
Now, the SpaceX bull will say, “Whoa, slow down there, Jeff – SPCX is a groundbreaking company and loads of profits are coming in time.”
Perhaps. But S&P Global doesn’t expect the company to generate positive free cash flow until 2029. And yet the stock, even after its slide, still trades at a range of 70 to 90 times sales.
For comparison, Nvidia (NVDA) – the poster child of this entire AI boom that’s generating gobs of actual profits – trades at roughly 13 times sales.
Now, none of that is a reason SpaceX can’t – or won’t – go up. It just means that if it does, it won’t be because of fundamentals.
Bottom line: know the difference between a stock rising on conviction and one rising on plumbing.
We’ll keep you updated on all these stories here in the Digest.
Have a good evening,
Jeff Remsburg
(Disclosure: I own MU, AMZN)
