July 17th Pre-Market Brief

Good Morning

Not the green send off into the weekend I was hoping for. Chips are red across the globe, Netflix is back at 2024 prices from a bad earnings reaction, and oil keeps climbing as the Iran mess drags into the weekend.

Heavy tape out there. The one thing I keep staring at is Nvidia it’s basically flat through all of it, which has me thinking this is more about crowded positions unwinding than the AI hope falling apart.

Let's dig in...

Today's Big Picture

1. The Chip Sell-Off Is Splitting The AI Trade In Two
Nvidia is nearly flat since late June while about $3.3 trillion in global chip value is gone, so this isn't AI breaking, it's the market sorting winners from the crowd. China's Moonshot dropped Kimi K3 overnight, a cheap open model desks are calling a "DeepSeek 2.0" moment, and the fear it revives is simple: if good models get cheap, the trillion-dollar buildout gets harder to justify. That lands hardest on the picks-and-shovels names in memory and equipment, where the spending has to pay off for the stock to work.

2. Netflix Just Told You Less, Right When You Wanted More
$NFLX opens at a two-year low, its worst day in over four years, and the quarter itself was fine. That's the point. The stock is falling on guidance alone for the second time this year, which tells you the market has stopped paying up for "in line" and now needs Netflix to beat and raise just to hold the line. Buried in the release: they're cutting how often they publish viewer engagement data, so the one dashboard investors used to check the growth story goes dark right as growth slows.

3. Oil Finally Believes The War
For weeks the market treated each Iran escalation as theater and crude barely moved since its big crash down into the end of June.

Well, not this time: WTI is above $81, Brent above $86, both headed for their best week since April, after Iran widened strikes to Syria and Bahrain and the U.S. hit bridges to choke off an Iranian port. The Strait of Hormuz, a fifth of the world's oil, is snarled again with the truce dead.

Market Overview

Today’s Sponsor

7 Stocks to Ride The A.I. Megaboom

The next A.I. boom could create massive winners just like the 1990s tech surge.

We identified 7 small tech companies positioned to benefit from the next phase of A.I. growth.

See them inside this free report 7 Stocks to Ride The A.I. Megaboom.

View the 7 Stocks

Stock Spotlight (pre-market)

Alphabet $GOOGL ( ▼ 4.44% )  
Down a second day after Bloomberg reported its next Gemini model is months behind internal targets. ER next week.

Intuitive Surgical $ISRG ( ▲ 3.44% )  
Beat on both lines and sold off anyway, because it held its full year procedure outlook flat instead of raising it. At this multiple, steady reads as a letdown, so the people who owned it as a quiet compounder away from the tech noise are the ones stepping out this morning.

BP $BP ( ▼ 0.61% )  and ConocoPhillips $COP ( ▲ 1.24% )  
Both higher ahead of an expected Iraq investment announcement today, reportedly worth billions. With the war bidding up crude, the money that was underweight energy is now the group chasing anyone with barrels to add.

SpaceX $SPCX ( ▼ 3.08% )  
Lower after Thursday's Starship launch auto-scrubbed when an engine failed to ignite. A young stock with no earnings to anchor it trades headline to headline, holders are stuck reacting, and the next attempt is only days out.

Truist $TFC ( ▲ 0.85% )  
Higher after a clean beat on both revenue and profit. Regional banks were one of the few corners that stayed green through Thursday's sell off.

What to Watch

Upcoming IPO’s?
MarketBeat did an excellent job on this free IPO guide on IPO’s happening this year.

Weekend Headline Risk (After Friday's Close)
The market shuts Friday afternoon the war does not. Trump has threatened Iranian bridges and power plants next week if talks don't resume. Any Hormuz shipping hit between the close and Monday's open lands on a market that can't react until it gaps. This is the next domino, and it falls when nobody can trade it.

Mega-Cap Earnings (Next Week)

Alphabet reports July 22, Microsoft July 28, Meta July 29, Amazon July 30. So Microsoft, Meta, and Amazon all report next week, and Alphabet leads off Tuesday.
Options pricing shows unusually heavy call buying in Meta, Microsoft, and Amazon into earnings, extreme by each stock's own history. One analyst called the group priced for “perfection”.

- John

Today’s Sponsor

Every World Cup match is a market.

48 games. 32 countries. One tournament. From the group stage through the final, every outcome is tradeable in real time on Kalshi, a federally regulated exchange and official regional partner of the Argentine National Team.

You're not picking a spread. You buy "Yes" or "No" shares on what you think happens: who wins, who advances, who scores first. Earn returns if you're right. Peer-to-peer. No house. Cash out before the final whistle.

Trade $10, get $10 free to start.

Start Trading the World Cup

_{Trade responsibly.}