In this single‑speaker video Kenny Polcari opens with a brisk morning greeting and immediately dives into a comprehensive market briefing for Friday, May 15, 2026. He celebrates historic equity milestones – the Dow breaking 50,000 and the S&P 500 closing above the 7,500‑point “century” mark – and attributes the rally to a wave of AI‑related semiconductor, networking, data‑center and cloud infrastructure stocks. Polcari then cautions that the rally is built on narrow market breadth, with only a handful of mega‑cap tech names driving the gains while many stocks make new lows, urging diversified, disciplined allocation. He reviews sector performance, bond‑yield movements, recent CPI/PPI data, and the emerging “Warsh effect” (Kevin Warsh’s inflation‑focused stance at the Fed), noting that yields have eased slightly despite sticky inflation. The geopolitical segment covers the Strait of Hormuz, where Iran is allowing limited ship transits for a $1‑2 million per‑vessel fee payable in yuan or crypto, creating new inflation and sanctions risk. Polcari comments on the VIX’s recent rise, the potential for a 4 % pullback to the 7,150‑7,200 range, and offers investment discipline advice (avoid FOMO, stick to a personal risk‑profile plan). He lists the day’s ex‑dividend stocks and briefly mentions European market weakness and UK political turbulence. The video concludes with a step‑by‑step recipe for potato‑and‑veal meatballs with carrots and artichokes, complete with ingredient list, cooking instructions, and serving suggestions, before signing off from Florida.
Chapters
Well, good morning. Yes, it's me, Kenny Polcari, your host of the party. And today is Friday, May 15th, 2026. We're halfway through another month this year. It's really amazing. And here are the things that you need to know to get your day started. Well, guess what? The S&P entered yet another new century as the Dow crosses 50,000. New highs versus new lows. Pay attention to this story. The bonds are steady, oil is up this morning, and the VIX is also up. Iran, well, they're allowing ships to navigate the strait, but at a price. European markets are lower, US futures are lower, all on inflation worries. Wow, think of that. And what do we have for dinner tonight? We're gonna have the veal and potato meatballs. Okay, it's go time. The bulls continue to stay in control as investors, traders, and algos continued piling into the AI semis and anything tied to the digital infrastructure buildout play, pushing the major indexes to fresh highs and driving the Dow above the historic 50,000 level for the first time ever, while the S&P crossed over yet into another new century. Let me repeat that. The S&P closed at 7,501, another century mark, and the speed of this move is nothing short of remarkable. Remember, on March 30th, the S&P ticked at 6,316 in what looked like a potential disaster as the Iranian conflict was one month old, causing angst for investors. But that was the low. The reversal in sentiment was driven by this de-escalation talk and the sense that the world was going to come together and go hard on Iran, bringing the conflict to an end. Since then, the S&P has advanced 18.7%. On April 15th, we broke through 7,000. On the 17th, it was 7,100. On the 30th, it was 7,200. On May 6th, it was 7,300. May 11th was 7,400, and yesterday was 7,500. Think about that just for one minute. Five new century marks in one month, and it's all being driven by tech, AI, and the second and third derivatives of that story. So think semis, networking, data centers, power demand, cooling systems. Cybersecurity, cloud infrastructure, basically anything connected to the AI buildout has become the place that investors want to be at. So just to be clear, this is no longer just about NVIDIA. At 4:00 PM yesterday, here's what it looked like. The Dow gained 370 points. The S&P up 57 points. The NASDAQ surged by 232 points. The Russell added 19 points. The transports gained 276 points. The equal-weighted S&P added 30 points while the Mag 7 tacked on another 180 points. Now it's all good, or is it? Here's where things get a little bit interesting, because despite all the excitement over Dow 50,000 and S&P 7,500, the internals of the market are weaker than the headlines suggest. Yesterday was another textbook example of what is known as this narrow breadth, right? Narrow breadth, let me remind you, is when a handful of the mega-cap tech and AI names are doing almost all the heavy lifting, all while a large portion of the market quietly struggles underneath the surface. So yes, the S&P closed at another record high, but there were only 42 stocks making new 52-week highs yesterday while 114 were making 52-week lows. The key thought here is declining stocks outnumbered advancers. Think about that. More stocks were breaking down than breaking out, even as the index itself pushed to new highs. That's what happens when the market becomes overly concentrated, and that's the reason I keep telling you to make sure that you have a properly diversified, well-balanced allocation. That is what will help you navigate the waves, right? Now, 7 of the 11 S&P sectors finished higher. Tech up 1.5%, energy up 0.8%, financials up 6%, utilities, uh, industrials and utilities up 0.5%. Consumer staples and communications rose 0.3%. You saw weakness in consumer discretionary. No, no, uh, no surprise there. Healthcare, real estate was down 0.7%, and basic materials was down 0.75%. Now down the chain, we saw mixed action. Homebuilders up 1.1%, retail was up 0.8%, airlines were up 0.3%. Disruptive tech was down 0.1%, which is a little bit surprising. The value trade up a quarter, the growth trade was up 1.2%. Emerging markets up a quarter of a percent, cybersecurity up a whopping 3.3%. Semis up 0.3%. Software up 2.3%. Aerospace and defense, though, under pressure. Quantum computing up 4.5%. Exploration and production up 0.5%. Nuclear and uranium down 1%. Biotech down 7%, while the small caps gained 0.6%. Now, you can also credit the move to a combination of good enough economic data, easing bond yields, tiny, tiny, and renewed optimism surrounding the Trump Xi Jinping summit in Beijing, where earlier reports suggested that progress on trade discussions and even cooperation around AI infrastructure and technology happened. That was all the excuse that investors needed to keep chasing risk higher. And then there was Cisco. It exploded up more than 13% after crushing earnings expectations, raising guidance, and doubling down on their AI strategy, reinforcing the idea that the AI buildout is more than just about chips. Now this isn't about, uh, this is about networking, enterprise architecture, cloud buildout, data center modernization. Let's call it the AI ecosystem, and the Momo guys loved it. Let's be clear, I'm not saying the story is wrong, far from it. The AI revolution is real and it's changing the investment landscape in ways that we're only beginning to understand. But I'll tell you this, the tone of the market is starting to feel a bit giddy to me, and that's a warning flag. Not a sell signal, not a panic signal. It's a discipline signal. Because when investors start chasing— and that's what's happening— anything with an AI attached to it, when 5 new S&P century marks happen in one month, when the same handful of stocks are dragging the entire market higher while breadth deteriorates underneath the surface, you have to recognize that emotions are beginning to take over. And that's exactly when people get FOMO-ized. You do not need to chase the hottest trade on earth at the exact moment that everyone else suddenly decides that they can't live without it. That's usually when mistakes get made, right? Because you make an emotional decision. Okay, now let's talk about bonds, because while stocks are celebrating, the bond market continues to send a more cautious message. And we've discussed this. Especially since we got that scorching hot PPI report on Wednesday. Bond yields pushed higher, kissing the danger zone on all 3 measures— the 2, the 10, and the 30-year, right? 4%, 4.5%, and 5% respectively. Now yesterday they did not push higher, and in fact they eased off a tiny bit, and that gave the Momo crowd and algos a reason to keep going. And why? Because yields did not go higher. The very slight easing in yields only added to the excitement. But make no mistake, Tuesday's hot CPI and Wednesday's hotter PPI has changed the conversation. Those data points reinforce the idea that inflation pressures are broadening and that the Fed is now backed into a corner just when the baton gets passed from JJ to Kevvy. Now, this is going to be interesting, right? Because how's Kevvy going to convince the committee and street analysts and economists and investors that rates have to come down in this environment. Not happening, at least not yet. And yet stocks continue to climb. Yesterday's retail sales came in at up a half a percent versus the expectation of up 4/10 of a percent. Hardly a blockbuster, but good enough to calm recession fears and support that soft landing narrative. Jobless claims at 211,000 also reinforced the idea that the labor market remain solid, not overheating. So the economy is slowing but not breaking. Inflation is sticky but not spiraling, all while investors continue betting that AI productivity is going to ultimately overpower everything. Meanwhile, oil prices eased just a tiny bit yesterday after reports, uh, suggested that roughly 30 Chinese vessels, along with several, um, uh, LNG carriers bound for India and Japan successfully crossed the Strait of Hormuz under what Iran is now calling an Iranian management protocol. What? Iran appears to be selectively allowing energy shipments to move again, particularly those tied to China and India, which helped calm immediate fears of a complete supply shock. But let's not kid ourselves, right? This situation remains elevated and volatile, because while some ships got through safely, there were also reports of an unidentified vessel being seized near the United Arab Emirates and an Indian flagship sinking off the coast of Oman after what is believed to have been a drone or missile strike. So yes, there is progress, but no, it's not stability. In fact, what's emerging looks more like a controlled choke point rather than a fully open international waterway. And here's where it gets even more interesting. Iran is reportedly now charging what many are calling the Tehran toll booth fee, somewhere between $1 and $2 million per ship, payable in Chinese yuan or in crypto, in exchange for safe passage through designated shipping corridors controlled by the Iranian Revolutionary Guard. Now, it's a strategic global energy choke point, is now effectively operating under an armed escort and fee-for-passage system that may temporarily ease shipping flows, but it also creates an entirely new layer of geopolitical, legal, and inflation risks because companies paying those fees could ultimately face sanctions. So while yesterday's successful transits helped cool some of the personalities in this story, the broader message is this: the strait is not really open. It's being managed, and the market is still trading every headline accordingly. Now, yet yesterday the VIX closed at 1726, down 3.4%, which feels way too complacent to me considering everything that's going on in the world. I've been talking about that because remember, risk does not disappear, it just gets temporarily mispriced. This morning the VIX is up a buck 50 or 9% at 1883, taking it up and through trendline resistance. Now, if the VIX continues climbing towards 20+, then expect pressure on equities to intensify. And then there's the Fed, or maybe more importantly, what comes next at the Fed. The market is increasingly beginning to price in what I've been calling the Warsh effect, the idea that Kevin Warsh could bring a much more disciplined and inflation-focused framework to monetary policy, which means no cuts for you. Today's eco data includes Empire Manufacturing, industrial production, and capacity utilization. There are no key earnings today, but there are a ton of stocks going ex-dividend. KKR, Emerson, Duke, uh, Constellation Energy, DuPont, Lilly, ExxonMobil, Amgen, Hershey, Honeywell, and Cintas all going ex-dividend today. European markets are under pressure, all down more than 1.25%. The focus today is— guess what— brewing inflationary pressures. Hello! Suddenly they're worried about brewing pressures. What happened to the AI trade? In the UK, Prime Minister Starmer is taking his last breath as Prime Minister. There's a revolt taking place over in London, and the outcome is still cloudy. There'll be more on that over the weekend, maybe next week, right? US futures naturally are under pressure. Guess why? Do I really have to discuss this? Dow futures down 215, S&P's down 60, NASDAQ down 340, and the Russell's down 25. The S&P closed, like I said, at 7,501, a new century, up 57 points. This morning it feels like a bit of profit taking, and no one should be surprised at all. The chart has gone parabolic, so as investor, you should want to see a pullback. Remember, trees don't grow to the sky. Now, if you look at the chart, it would not surprise me to see us pull back to the 7,150, 7,200 range, uh, which would be about a 4% pullback. Which would be nice because it would shake the branches a little bit and force the weak hands to fall out, all while providing an opportunity for long-term investors to buy stock at better prices. My advice: enjoy the ride, but stay disciplined. Do not make emotional FOMO-driven decisions in either direction. Stay focused, stay in quality, stick to your plan. A plan that should be based on who you are, your age, your risk tolerance, and your liquidity needs. Feel free to call me at 561-931-0190. Happy to discuss it. Okay, what do we have for dinner tonight? We're gonna have the potato and veal meatballs with carrots and artichokes. It's a great appetizer or cocktail party dish, or you can pair it with a mixed green salad and it can become a light lunch or even a dinner meal. Now for this you need a lemon, a bag of frozen artichokes, 2 large Idaho potatoes, 2 pounds of ground veal. You need finely chopped thyme, 2 large egg yolks, You need fresh grated Parmigiano-Reggiano cheese, whole milk, salt and pepper, butter, olive oil, and about 3 cups of beef broth. Now, 4 medium carrots, you need 'em peeled, cut in half lengthwise, and then cut into little bite-sized chunks. You need 1 shallot diced, splash of dry white wine, cup of heavy cream, and chopped parsley. In a saucepan, bring the beef broth to a simmer, remove it from the heat, and just cover it to keep it warm. Next, boil the quartered potatoes in salted boiling water until they're soft, 15 minutes or so. Drain them and put them in a classic potato ricer and then crush them into a large bowl, right? Now you're going to that bowl, you're going to add the veal, the thyme, 1 egg yolk, the cheese, the milk, the salt and pepper. Mix it well with your hands, but don't overmix it, but mix it well. Now form into balls bigger than a golf ball but smaller than a baseball. In a large nonstick high-sided pan, right, heat a dollop of butter and a bit of olive oil over medium-high heat. When it's nice and hot, you're going to put the meatballs in, fry the meatballs, turn it occasionally until they're well browned and cooked through. Now, depending on the size is going to dictate the time. Small balls, 4 minutes. Larger balls, 7 minutes. Then you're going to— when they're done, you're going to remove them, set them on a plate lined with a paper towel, suck out some of the oil, add a bit more olive oil to the nonstick pan, and now heat— turn the heat up to medium-high Add the shallots, sauté for 3 minutes. Now add the artichokes and the carrots. Cook it, stirring frequently, for 4 to 5 minutes. Add the wine and the broth, bring it to a boil, reduce to simmer, cook it for 10 minutes. Now you're gonna add back the meatballs, and if you like, you can add a frozen bag of peas at this point. You don't have to, but you can. And continue cooking it for 10 more minutes, gently turning the meatballs halfway through so they're, again, all nice and delicious. You want the veggies to be nice and tender. Now in a separate bowl, squeeze 1 teaspoon of lemon juice, whisk together with the remaining egg yolk and the cream. Carefully introduce this mixture into the pot with the meatballs, into the sauté pan. Return the broth to a simmer, stir it, mix it, take it off, let it cool for 3 minutes, sprinkle it with parsley, and bang, you're done. You can serve this, if you're gonna have it for lunch or dinner, make a nice green salad, have this on the side. You're gonna serve them for a cocktail party or a party dish, just put them in a nice bowl with toothpicks and let everyone go to town. In any event, it's Friday here in Florida. It is an absolutely beautiful day, although the weekend is supposed to be cloudy and rainy. Let's see if that predicts, if the market predicts what the weekend weather says. In any event, until Monday, take good care.
