To The Moon

Greg Boland is chief strategy officer for Tiger Brokers New Zealand.

ANALYSIS: The on-again-off-again tariff saga continues, with President Trump extending the pause on his sweeping reciprocal tariffs – originally set to start on July 9 – to August 1. This gives countries more time to finalise trade deals with the United States. However, “tariff letters” have been sent to about 14 countries, including Japan, South Korea, Malaysia, Laos, Myanmar, and others, warning of new duties ranging from 25% to 40%. Prime Minister Ishiba of Japan has reaffirmed his country’s commitment to ongoing negotiations, describing the tariff move as “extremely regrettable” but emphasising that the announced rate is lower than the previously threatened 30% to 35% - leaving room for talks before the August deadline.

Reportedly a new 50% tariff is being applied to copper imports, with plans to impose more tariffs on semiconductors and pharmaceuticals. Countries aligned with the BRICS alliance (Brazil, Russia, India, China, South Africa – the world’s leading emerging market economies) face an additional 10% tariff, described as a penalty for anti‑American policies.

The ongoing saga continues to trigger market uncertainty and rising costs at home. A Yale research study finds the average US tariff rate has soared to 17.6%, the highest since 1934 – and will cost American households an estimated US$2,300 in 2025.

The $S&P 500(.SPX)$ closed flat on Tuesday (US EDT) this week, having hit an all-time intra-day high of 6284 last Thursday ahead of the July 4 Independence Day holiday.

US President Donald Trump’s been sending out letters to countries, informing them how much by way of tarrifs they’ll soon be paying.ALEX BRANDON / AP

Other Indicators: VIX, Breadth, and Options Signals

Unlike the post-Inauguration bull run when only the index itself was bullish, this time around other indicators, such as market breadth, the VIX, and the put/call ratio are highly bullish. The $Cboe Volatility Index(VIX)$ , short for the CBOE Volatility Index, is often referred to as the “fear gauge” of the stock market. Think of it as a real-time sentiment indicator for how nervous or calm investors are. The VIX closed at 16.81 on Wednesday, having previously peaked above 60 in early April as the S&P 500’s volatility diminishes with the market’s continued recovery from Liberation Day.

The equity-only put/call ratio is a widely used sentiment indicator that measures investor behaviour in the stock market, specifically through options trading. On July 3, the equity-only put/call ratio was 0.48, its lowest level since mid-May. This means that there are about 48 puts for every 100 calls on single-stock options. This level is below the long-term average (~0.6), indicating a moderate-to-strong bullish sentiment among equity option traders. This could be interpreted as signalling a degree of complacency, increasing the likelihood of a short-term pullback. If the ratio drops further (e.g. ~0.45), it could suggest overheated bullishness and potential market vulnerability.

Time will tell but keep an eye on these two options indicators as a gauge of bullish complacency or bearish fear.

In other S&P 500 Index news, late last week $Datadog(DDOG)$ was granted admission to the S&P 500, becoming the sixth company to join in 2025. Datadog is a leading cloud monitoring and security platform. Since its IPO in 2019, Datadog’s share price has increased by more than 261%, compared to 106.8% for the benchmark that it joins. This change in the index came after Juniper Networks was acquired by Hewlett Packard Enterprise, opening the door for Datadog’s addition. The stock jumped about 15% on the index news, and passive index funds will need to buy to remain index-weighted.

Datadog has been granted admission to the S&P 500, after its initial public offering in 2019.N/A

From Datadog to Palantir: Key Movers and Market Signals in the S&P 500"

In the past five days, the top performers in the index have been resort stocks $Wynn(WYNN)$ and $Las Vegas Sands(LVS)$, up about 18% and 13% respectively. A leading analyst has initiated coverage on Wynn with a buy recommendation, while an analyst at another major investment bank has raised its price target on the stock from US$83 to $101.

$Moderna, Inc.(MRNA)$ is also about 18% higher after stating that its seasonal influenza vaccine candidate, mRNA-1010, showed superior efficacy in a Phase 3 study that compared it with a licensed standard-dose seasonal flu vaccine in adults aged 50 years and older. Hewlett Packard Enterprise also gained after the US Department of Justice approved the Juniper Networks acquisition.

The worst performer is health insurer $Centene(CNC)$ , which is down about 40% in the past five days after the company pulled its earnings guidance after new data showed that the insurance plans it sells on the Affordable Care Act exchanges were lower than anticipated. Rivals Molina Healthcare and Elevance Health also fell about 22% and 10% on the news.

The S&P 500 Index’s top performer year to date remains Palantir, up about 85%, with NRG Energy and Seagate Technology both up more than 67%. Palantir builds and deploys software platforms for the intelligence community to assist in counterterrorism investigations and operations. It was the top performer in the index last year and is currently trading at approximately US$140 per share, having started 2024 at less than US$17.

US Reporting Season: A Second-Market Briefing

The reporting season in the US kicks off next week, with the banks leading. It will be interesting to see how profitable bank earnings have been during a very volatile second quarter. One suspects the equity and FICC (fixed interest, currencies, and commodities) arms of the banks would have done particularly well.

$Tiger Brokers(TIGR)$ s’ Greg Boland says next weeks’ big bank results out of the US will be an interesting reflection on a “very volatile” second quarter.

Meanwhile, the multi-trillion-dollar club – BATMMAAN (Broadcom, Apple, Tesla, Microsoft, Meta, Amazon, Alphabet, and Nvidia) stocks remain a mixed bag year-to-date.

Over the past two weeks, $NVIDIA(NVDA)$ has knocked $Microsoft(MSFT)$ out of top place in the capitalisation rankings of the US market as it races towards becoming the first $4 trillion company. Nvidia is up more than 19% year to date, and Microsoft and $Broadcom(AVGO)$ both up over 17%, while $Meta Platforms, Inc.(META)$ still leads, up nearly 23%. $Alphabet(GOOG)$ , $Apple(AAPL)$ , and $Tesla Motors(TSLA)$ are still in negative territory year-to-date.

It took Apple 38 years after its initial public offering (IPO) to achieve a $1 trillion capitalisation, just over two more years to become a $2 trillion company, and nearly three additional years to get to $3 trillion. In comparison, Nvidia became a $1 trillion company 24 years after its IPO, only nine months to double to $2 trillion, and a mere 3.5 months to get to $3 trillion.