In this live market commentary from the New York Stock Exchange, Kenny Polcari walks viewers through the aftermath of a tech‑driven sell‑off that began in South Korea and spread globally, focusing on AI‑related semiconductor and memory stocks. He examines whether the weakness is confined to over‑extended AI names or is spilling into broader sectors, using breadth and sector rotation data to gauge market health. Polcari highlights the role of long‑term Treasury yields and Fed Chair Kevin Walsh’s inflation‑hawk stance as a backdrop for the correction, noting 2‑year, 10‑year, and 30‑year rates and their impact on growth valuations. He details the performance of major indices, sector ETFs, leveraged and short ETFs, and the VIX, emphasizing that most S&P sectors finished in the green, indicating rotation rather than outright liquidation. Commodity moves are covered: oil has fallen to $71.65 per barrel amid easing geopolitical tension, while gold has slipped to $4,070 amid a strong dollar and lower inflation expectations. The upcoming Micron earnings report is framed as the next market catalyst, with expectations around memory demand, hyperscaler spending, and infrastructure investment. Polcari also provides a quick snapshot of economic data (new‑home sales, building permits) and futures RSI levels, noting a neutral technical stance for the major indices. He offers a complimentary portfolio risk assessment. The segment concludes with a step‑by‑step tagliatelle cremosa recipe, describing ingredients, cooking method, and serving tips.
Chapters
Well, good morning. Yes, it's me, Kenny Polcari, and guess where I am today? Coming to you live from none other than the New York Stock Exchange, as I'm here in New York City for the rest of the week. Anyway, today is Wednesday, June 24th, 2026, and here are the things you need to know to get your day started. Well, global markets are relatively calm this morning after yesterday's tech wreck. MU reports after the bell. It's really anybody's bet what they're gonna say. Oil is down, gold is down, yields, well, they're holding steady at higher levels. And what do we have for dinner tonight? We're gonna have the tagliatelle cremosa. It is delicious. Delicious. All right, so wake up because it's a new day. And as we turn our attention to today's session, remember this: yesterday wasn't the day to be a hero, right? It was a day to watch where the pressure was building, see what investors were doing. And the pressure was concentrated, it was concentrated all in the AI complex— semiconductors, memory names, all stocks that have led this market higher since the April lows. This should come as no surprise to anyone who's been paying attention because we've been discussing this almost ad nauseam, right? Now those are exactly exactly the names that you would expect to come under pressure first if investors are beginning to get nervous and start to question valuations. And as I noted yesterday, the question now is whether the selling remains concentrated in those most extended AI names, or does it really begin to spread across industrials, financials, healthcare, consumer staples, and the broader market? Because that answer matters. Because if the selling remains isolated to this overcrowded AI trade, then what we're experiencing is more like a healthy yet uncomfortable correction after we had this powerful run off those April lows. And so I, you know, I want to tell you, don't get emotional. But if the selling begins to become more indiscriminate and spreads across sectors and market caps and styles, then we may need to reconsider the possibility that something larger is developing beneath the sheets. And that's why today isn't about predicting what happens next. It's about observing the breadth and watching the leadership. It's also watching the long, the long end of the Treasury curve, right? The 20 years plus, because that's gonna tell us more than any headline will. Because in the end, investors, traders, and algos are finally asking the question that nobody wanted to ask. What if all this AI spending does not produce the returns that investors are expecting? Now that It's not that AI isn't real. It's not that AI isn't changing the world. Not that NVIDIA and Broadcom and hyperscalers like Amazon Web and Google Cloud and Microsoft Azure aren't building something extraordinary because they are. The sell-off in tech yesterday was really about investors suddenly waking up and questioning how much they're willing to pay for that future. Right. The idea though, they weren't willing to pay as much as they were on Monday. That's for damn sure, right? Now, it's a reality check in aisle 5. It started on the other side of the world, right? South Korea, to be exact. The KOSPI index lost 10%, tripping one of their circuit breakers, halting trading for 20 minutes, creating more pandemonium. But recall, that market is up 95% year to date, not 9.5%, 95%. So I'm actually surprised we didn't see even a bigger pullback at that point. But that selling turned into a global event, and that dragged technology stocks sharply lower around the globe. And last night, last night, Tuesday night, uh, when Tuesday into Wednesday, the KOSPI actually stabilized and it gained 3.25%. And the damage to the memory names, well, that seems to have at least subsided. So we'll see what happens today here. Foreign investors, though, ran for the door when the selling began, dumping $2.5 billion worth of technology names. Leveraged ETFs came undone. Margin calls went out across the network, forcing liquidations that only added to the sell-off and the drama. And suddenly the whole place came under attack. And when the sun set in Asia, it rose in Europe and the selling continued. And then it jumped on a flight to New York and, well, need I go on? Haven't we seen this before? Yes, we have. And there's so many places that we could begin to lay the blame, but let's not go there right now because that's not what this is about. Nothing in the tech space was spared yesterday. The tech ETF, the XLK, lost 4%. Disruptive tech down 2.2%. Semis down nearly 8%. Marvel itself lost 9%. The growth trade lost 2.4%. Expanded tech down 3.5%. Quantum names down 3%. Memory names, the DRAM ETF down 14.25%. And individual names in the group, including MU, gave back 13%. Western Digital 8.5%. And Storage Technologies lost 5%. But let's be clear, it wasn't pretty. But it's also not a reason to start abandoning that trade unless, of course, you get in at the top. Because if you did, then you're a bit— a little bit black and blue today. But if you got in at much lower prices, you're all good, right? At the end of the day, here's what it looked like. And while it was not a bed of roses, it was not a complete disaster at all. The Dow lost 46 points, the S&P lost 107 points, the Nasdaq got punched in the face, and then they got punched in the kidneys, losing 580 points or 2.2%. The Russell lost, uh, uh, 29 points. The transports lost 165 points, and the equal-weight S&P lost 32 points. The Mag 7 gave up 488 points, or about 1.5%. Now here's the stat though that should stop you from panicking. While the NASDAQ was getting hammered and semis were being taken out to the woodshed, 7 of the 11 S&P sectors actually finished in the green. They finished higher by the end of the day. So this is not liquidation across the board, it's kind of rotation. And that's important because liquidation suggests fear while rotation just suggests a repositioning of sorts, right? Industrials lost 2%, tech was down 4%, consumer discretionary down 1%, basic materials gave up 1.5%. On the upside though, consumer staples won the day, rising 1.9%, right? That makes sense when you think of the nervousness. Healthcare rose 1.4%, also makes sense. Real estate up 1.4%, utilities gained 8, uh, tenths of a percent, energy up 3/4 of a percent, while communications added 4 tenths of a percent. So As you would expect, the contra trades also did very well yesterday. The SNH, which is the S&P short, gained 1.4%. The PSQ, the NASDAQ short, gained 3.3%. The SPSX, which is the Direxion triple leveraged short, rose by 3.4%. The VIXI, which is the fear trade, gained a whopping 5.2%. And the SARK, which is the short disruptive tech trade, gained 2%. Let's talk about the elephant in the room. Fed Chair Kevin Walsh. Because while everyone wants to blame South Korea and Micron and memory chips and the AI valuations, part of this sell-off is so much simpler. It's all about rates and where they're potentially going. Walsh, remember, held his first press conference last week when I was on vacation. He made it crystal clear that defeating inflation remains the priority. And remember, he is an inflation hawk. He's made that very clear. And what the market heard last week was higher for longer. And that's where the problem begins. Yes, he said he can lower short-term rates and yes, he can shrink the balance sheet. One will offset the other, but he can't control, uh, the long end of the curve, right? He can't lower those rates. Now, right now the 2-year's kissing 4.2%. It's up 24% off the March lows when the whole inflation story began to gain steam, right? The 10-year's kissing 4.5%. And the 30-year is kissing 5%. And, and, and all those rates do is make it harder to justify these lofty valuations of these sexy growth names. And that is the trap. And that's what we saw happen yesterday. Now, we've been conditioned to believe that every pullback is gonna be met by lower rates, more liquidity, and another Fed rescue. You can thank Benny and Janet and JJ for all that. But Kenny is saying something very different. And the Momo trades, which are leveraged or not, are often the first casualties when investors begin adjusting to this new reality. I'm just saying, I suspect we may be seeing more of that if tomorrow's PCE report suggests hotter inflation at the core level, which eliminates the volatile food and energy sector. So if we see that hotter than we expect, then that's going to potentially cause more unrest in the markets. Meanwhile, oil continued its decline as investors grow more comfortable while the ceasefire between the US and Iran is holding up and more than 19 million barrels of oil flow through the Strait of Hormuz, or at least that's what we were told, right? This morning, uh, WTI is down $1.50 at $71.65. It's now down 27% off the May highs. Now we have seen, uh, we've seen oil breach both the short-term and intermediate-term trend lines, and right now it's about to sit right on its long-term trend line at $70, where it should probably find some support until there is some finality and clarity, uh, on this conflict, right? Once we know it's all over, then, uh, once that happens and production returns to normal, we could see WTI trade back to the low to mid-60s where it was prior to the conflict. Remember, low oil helps inflation, it helps consumers, it helps corporate margins, and ultimately lower oil helps the Fed. Now gold continues to fall. This morning it's down another $50, trading at $4,070. We're now well below all three major trend lines and trading at levels last seen in November of 2025. So here's the deal. If geopolitical tensions continue to ease, the dollar remains firm, and inflation stays under control, then the fundamental reasons that investors rushed into the gold trade will begin to fade. And if that's true, gold could continue to break down and potentially revisit levels last seen in August of 2025, which is near $3,500 an ounce. Now, I know that sounds aggressive. But who thought gold was going to rally by 174% over the last 2 years? Now, markets always overshoot. They overshoot in both directions, right? The pendulum swings too far left and too far right. And if the fear premium continues to come out of the trade, a move towards $3,500 is not impossible. It's simply a scenario that you have to consider. Now, which brings us today, because now everything is going to come down to Micron, and they report after the bell. So as we— and it's just, it's just what was just another earnings report, you know, last week has suddenly become the most important report of the quarter, even more than Nvidia, dare I say. Now we want proof. The market wants proof, proof that memory demand remains strong, proof that hyperscaler spending remains intact, proof that the infrastructure investment is still accelerating, and proof that the trillions of dollars being spent across the industry will ultimately produce real returns. A beat and raise is going to— will be cause for a celebration. Anything less will pour gasoline on yesterday's sell-off. The stock is priced to near perfection, and when that's the case, anything less than perfection will become a short-term problem. Either way, we're about to find out right after the bell tonight. Now, the announcement happens, you know, at 4:02 after the bell rings. So you can feel the excitement. While I think it's going to be a very good report, you can never underestimate how traders and algos will respond. Remember, the stock is up significantly this quarter, 290%, so you shouldn't be surprised that people— the trader types take profits because they're not long-term investors. ECO data today includes new home sales expected to be up 3.2%, building permits expected to be down a tenth of a percent. European markets are mixed. France is up 3%, Germany's down 9 tenths of a %. US futures are also mixed. Dow futures down 100 points, S&P's are up 20 points, and NASDAQ is up 185 points while the Russell is giving back 9 points. Now all 4 of these indexes are in the neutral zone via their RSIs right now. While they're still a bit elevated, they are not in the overbought condition nor are they in the oversold condition, which just means we might just churn and digest the recent moves. The S&P closed at 7,365 yesterday, down 107 points. It's sitting right on the short-term trend line where I think it holds, at least for now. The 4 PM NQ announcement is going to determine what happens though tomorrow. The VIX is down 1% this morning at 19:30, and SpaceX is up a half a percent at 156.80. You can give me a call at 561-931-0190 to discuss your goals and your timeline. Let's assess the risk in your portfolio. Versus your tolerance for risk, right? I'm happy to do a complimentary portfolio review and total risk assessment. Okay, so now what do we have with dinner tonight? This is a simple, easy, great summer dish. It's tagliatelle cremosa, right? It's a Milano favorite. So, and people in Milan, this is one of their go-to simple summer dishes, right? It's cherry tomatoes, it's a bit of lemon zest, It's plain Greek yogurt, it's burrata, parmigiana, fresh grated parmigiana. You need fresh basil and some good olive oil, and of course some salt and pepper. You want to begin by bringing us a pot of salted water to a rolling boil, put it on the back burner just so it's ready when you need it. Now in a small pot, you're going to add the cherry tomatoes, just whole, don't cut them up. You're going to add a garlic clove, whole, olive oil, salt, pepper, and a sprig of fresh basil. Put it on the heat, cook it over medium heat until the tomatoes start to pop. Right? Now, when that happens, you're going to add the pasta to the water and cook it until it's al dente. Now, if you use fresh pasta, it's only going to be 3 minutes. If you use box pasta, it's going to be closer to 8. So make sure you know which one you're using so you can time it correctly. Now, in a blender, you're going to add 2 balls of the fresh burrata cheese. You're going to add 1 tablespoon of Greek yogurt, plain, not flavored. You need some grating of lemon zest. You need the cooked cherry tomatoes and a tablespoon of fresh grated Parmigiano Blend it all well and make it into a smooth, creamy sauce. Now pour that sauce into a large sauté pan. Add the pasta directly to the pan when it's done. After it's cooked, take it right out, add it directly to the pan and mix it well. Feel free to add a little bit of the pasta water to keep it moist if you need to. Always have fresh grated cheese on the table for your guests, and you want to serve this immediately in warm bowls. Trust me, this will become a summertime favorite. It is simple, it is easy, and the kids will love it. Look, until tomorrow, take good care.
