This week tested anyone who thought the AI rally was going to keep running on autopilot. We got two straight Nasdaq record closes Monday and Tuesday — 27,122 then 27,244 — and then watched the bond market pull the rug out. The 10-year yield hit 5.2%, the highest level since 2007, and that was enough to send the Nasdaq down 0.9% and the S&P 500 down 0.8% by Monday’s close. ARM Holdings dropped 8.7% in a single session. Consumer confidence came in at 81.9 against an expectation of 89. This was a week that reminded everyone that bond yields are still running the show.
From a portfolio standpoint, after last week’s plan to diversify away from my heavy concentration in AXP, NVDA, and PLD, the timing feels right but the environment is making me more selective about where I add. NVDA held up better than most of the AI complex this week, which honestly makes me less eager to trim it than I was a week ago. That said, AMD’s $8.2 billion acquisition of Fei-Fei Li’s World Labs is an interesting signal about where the talent war in AI is heading — I’m adding AMD to my watchlist as a potential diversification play in the semiconductor space.
The macro picture is the wild card right now. The Trump-Xi summit following what was described as “very successful” trade talks is genuinely encouraging, but US-Iran tensions and oil sitting in the $94–97 range are keeping a ceiling on the optimism. I’m still holding more cash than I’d like and I plan to start putting some of it to work — but carefully, in names with strong fundamentals that can handle a rate environment that doesn’t look like it’s letting up anytime soon.
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