Markets at All-Time Highs: Why the U.S. Economy Still Looks Strong
July 6, 2025 - Update
MACRO: The US economy looks just fine.
Last week, data on job openings, non-farm payrolls, and the unemployment rate all came in better than expected.
Many economists have been predicting an imminent recession for the last three years or so… one day they’ll get it right!
What I see is an economy that looks strong, doesn’t need a rate cut today, and where inflation remains under control—below 3%.
My favorite indicator, liquidity and credit availability, suggests that things should continue going well for the US economy over the coming months.
Sure, tariffs remain a big threat if Trump starts talking about crazy numbers again. My guess is that this is behind us, and we should see a normalization of trade deals between the US and many countries over the next few weeks.
Overall, from a macro perspective, the context is positive for stocks.
INDEX & SECTORS
The S&P 500 closed up 1.7% for the week at all-time highs (ATH). The index is above all key moving averages and looks strong.
Sectors
Last week, Materials, Consumer Staples, Financials, and Information Technology were the strongest sectors.
→ Implication: Defensive and cyclical sectors both showed strength, suggesting sector rotation—typical early in the month.
Over the past month, the strongest sectors have been Information Technology, Materials, Financials, Communication Services, and Industrials.
→ Pattern: Continued strength in cyclical and tech-driven sectors indicates investor confidence in economic strength.
Groups
Looking at groups, Banks, Food, Beverage & Tobacco, Consumer Durables & Apparel, Materials, and Transportation stood out last week.
→ Implication: Focus on traditional economy and consumer sectors; potential positioning for interest rate or macroeconomic stability plays.
Over the past month, the top groups were Semiconductors & Semiconductor Equipment, Banks, Technology Hardware & Equipment, Consumer Durables & Apparel, and Real Estate Management & Development.
→ Pattern: Emphasis on high-tech (semis, tech hardware) and interest rate-sensitive areas (banks, real estate) suggests thematic plays around tech demand and possible rate pivot expectations.
PORTFOLIOS
10X MOMENTUM PORTFOLIO
Here, my COIN and FIX orders were filled. I'm now almost fully invested in this portfolio. Next week, I’ll use a STOP BUY order with my remaining cash in the account, as follows:
BUY STOP order for 65 shares of AMTM (Amentum Holdings) if it touches $24.57. If triggered, my stop loss will be set at the current SL of $21.
I’ve updated all my Stop Loss levels as shown in the table below.
After slightly more than 3 years, this portfolio has returned 46.5% per year (average return). Currently, all positions are in the green, except for COIN (my latest addition), which is slightly in the red (-0.5%).
10X UNDERPRICED GROWTH PORTFOLIO
Last week, my orders for SYM, HOOD, ZETA, and DLO were filled at the open, as mentioned in my post last week. Here's what the portfolio looks like now:
SYM delivered +27% for the week!
HOOD: +10%, DLO: +1.3%, ZETA: -0.3%
I’m still 52% in cash in this portfolio. My target is to have a maximum of 10 positions, and I currently have 5. Out of these, SN is the only one not fully filled—so it’s time to complete it. I'm also opening new positions. Here's what I’m doing next week:
BUY STOP order for 50 shares of SN (SharkNinja, Inc.) if it touches $108.4
BUY STOP order for 17 shares of EVR (Evercore Partners Inc.) if it touches $288. If triggered, initial stop loss at $237
BUY STOP order for 175 shares of AAOI (Applied Optoelectronics Inc.) if it touches $29. If triggered, initial stop loss at $21
That’s all for this week.
If I manage, I’ll be posting deep dives into the companies I buy over the next days and weeks, which always meet my criteria of high-quality stocks.
Let’s see what this week brings.
Note: The market is a bit overbought, so a pause or contained correction could be in the cards. Impossible to say when, so I continue to implement my rules.
Lastly, next week I’ll be rebalancing my 10X Best of ARKK Portfolio experiment, which has delivered +87% (+137% annualized!) as of today.
Best of luck out there!
Important:
This is not investment advice. Consult a licensed financial advisor before making any investment decision.