$Rocket Lab USA, Inc.(RKLB)$ Bullish $Micron Technology(MU)$ Bullish $Tesla Motors(TSLA)$ ๐ฆ Market Pulse
From my seat, the tape confirmed structural strength rather than late cycle excess. The S&P 500 settled at 6,834.78, up +0.89% on the session, extending 2025 gains to +16%, and when I map this year against the full S&P 500 return distribution back to 1928, it registers as a solid double digit outcome rather than an outlier melt up. That distinction matters to me for forward expectations, valuation tolerance, and risk management discipline.
What stands out to me next is the NASDAQ Composite closing at 23,307.62, up +1.31%. I read this as confirmation that breadth, not just mega cap concentration, continues to support the advance. NDX and QQQ leadership aligned cleanly with COMP reinforces my view that this is confirmation strength rather than narrow breakout risk. The Dow Jones Industrial Average finished at 48,134.89, up +0.38%, lagging on a relative basis, which I interpret as rotation toward growth and cyclicality rather than a risk off divergence. Small caps also mattered, with IWM ending at 250.81, up +0.84%, and participation arriving without volatility spikes, signalling rotation rather than abandonment.
The intraday picture reinforces this read. Shallow pullbacks were consistently absorbed at visible liquidity pockets, and I did not observe sustained intraday reversal pressure. A volatility crush regime dominated throughout the week, gamma dynamics stayed supportive, and there was no evidence of breakdown behaviour. This keeps me convinced the market remains in a breakout continuation phase driven by breadth thrust rather than fragility.
Leadership concentration remains a key focus. The top 10 largest stocks globally are now valued at $26.12T, up from $26T last week, and the dispersion underneath that aggregate matters. NVDA closed at $4.406T, +3.93%, AAPL at $4.061T, +0.54%, GOOG at $3.725T, +1.60%, MSFT at $3.611T, +0.40%, AMZN at $2.430T, +0.26%, META at $1.660T, -0.85%, AVGO at $1.607T, +3.18%, TSLA at $1.600T, -0.45%, Saudi Aramco at $1.525T, and TSMC at $1.498T, +1.50%. The signal Iโm respecting most here is semiconductors and AI infrastructure driving upside torque while other mega caps consolidate.
๐ Fed Watch
Turning to rates, expectations remain anchored into year end. Front end pricing held steady, terminal rate expectations stayed stable, and real yields refused to spike. Inflation data credibility remains on my radar, particularly with shutdown distortions flagged. I expect inflation prints to stay broadly similar near term, reinforcing a data dependent Fed and preventing abrupt financial conditions tightening. The most recent 25 bp cut on 10Dec25 aligns with stabilising labour markets and easing wage pressures, yet projections pointing to fewer cuts in 2026 keep me alert to persistent core inflation above target. This balance continues to suppress tail risk while supporting risk on positioning.
๐ Earnings Spotlight
There are literally 0 stocks with a market cap over $1B reporting earnings next week.
๐ง Memory & Semiconductor Earnings Leadership
Memory and semiconductors dominated my focus this week. Micron $MU surged +8% post earnings, printed new 52 week highs, and in my view remains undervalued even after the move. The durability of AI driven memory demand across both training and inference workloads still looks underappreciated. Margins, pricing power, and AI capex alignment reinforce the structural bull case, with forecasts pointing to adjusted profit of $8.42 per share for the quarter, far exceeding prior expectations.
๐ YTD Structural Winners
That conviction is anchored in hard YTD data. Sandisk +560.03%, Western Digital $WDC +301.76%, Seagate $STX +243.37%, Robinhood $HOOD +225.68%, and Micron $MU +215.97% lead the S&P 500 this year. The fact that 4 of the top 5 YTD performers are memory related names reads as a structural signal tied directly to AI infrastructure buildout rather than speculative coincidence.
๐ Breadth Confirmation and New Highs
Breadth across individual names further reinforces that view. An unusually broad list of stocks printed new 52 week highs on Friday, including $RIVN, $RTX, $LRCX, $MNST, $INFY, $AA, $AGNC, $ALB, $ATI, $B, $C, $EL, $EXPE, $FCX, $FHN, $HSBC, $MSGS, $NYT, $PL, $SATS, $TD, $TM, and $UBS. This level of cross sector participation continues to confirm accumulation rather than speculative excess.
๐ Corporate & Strategic Catalysts
Rocket Lab also commanded attention! $RKLB surged after securing an $816M prime contract from the Space Development Agency to build 18 satellites for the Tranche 3 Tracking Layer focused on missile warning and hypersonic tracking. The $806M base award plus up to $10.45M in options, with total capture potentially approaching ~$1B including subsystem sales, materially strengthens long term revenue visibility and defence space positioning in my assessment.
๐ Space Stocks Went Vertical This Week
Iโm tracking a decisive vertical move across the space complex this week, with price action confirming that this rotation is no longer being driven by narrative alone.
$FLY surged +33.0%, $RKLB advanced +25.7%, $RDW gained +24.2%, $ASTS climbed +22.6%, $PL rose +16.5%, $SPCE added +9.0%, and $SATS finished higher by +3.0%. That breadth matters to me, because it signals group level accumulation rather than a single name squeeze or isolated headline reaction.
Iโm watching renewed talk of a potential SpaceX IPO in 2026 at a rumored ~$1.5T valuation reignite imagination across the sector, while Rocket Labโs recent contract wins delivered something far more important, tangible revenue backed proof. The combination of long duration narrative and near term visibility created a powerful feedback loop that drew in both momentum traders and longer term capital.
What stands out most to me is confirmation. $RKLB pushed into fresh highs and price discovery territory, extending strength into the end of the week rather than fading. That behaviour tells me this move is being actively repriced in real time. From my perspective, momentum in space is no longer being treated as optional upside, itโs increasingly being embedded into forward expectations as the commercial space race visibly accelerates.
๐งญ Volatility, Sentiment, and Ownership Reality
Iโm very aware that $RKLB is a volatile growth stock, and I think that volatility itself is part of the investment signal. During 20โ50% drawdowns, sentiment predictably flips toward concerns around competitive pressure from SpaceX, elevated price-to-sales multiples, or perceived delays around Neutron. When price turns higher, the narrative pivots just as quickly toward Neutron timing, expanded NASA and defence opportunity, and accelerating commercial space applications.
What matters to me is recognising that these swings are sentiment driven amplifications around a fundamentally improving business, not random noise. Price moves violently because expectations reset violently. Thatโs the nature of early-cycle infrastructure leaders.
Owning $RKLB means accepting that pricing will fluctuate dramatically with narrative shifts, liquidity conditions, and risk appetite. From my perspective, that doesnโt diminish the asset. It defines it. Over time, businesses that execute tend to absorb that volatility and convert it into long-duration value.
Iโm seeing similar behaviour in other high conviction names Iโve tracked recently, including $TSLA. Both delivered strong upside, both gave back gains during volatility spikes, and both are now reasserting structure as sentiment stabilises. That pattern reinforces my view that these moves are part of a broader repricing process, not isolated events.
Governance clarity emerged elsewhere as well. Tesla $TSLA benefited after the Delaware Supreme Court ruled that Elon Muskโs 2018 CEO pay package worth ~$56B when vested must be restored. That outcome removes a lingering overhang and restores long term leadership alignment from my perspective.
๐ Options Flow Radar
Options markets continued to lean constructive. Call dominant flow persisted across semiconductors, memory, and AI infrastructure, with call sweeps clustering in near dated and early 2026 expiries. Implied volatility compressed rather than expanded, reinforcing the volatility crush regime. Gamma exposure stayed supportive, downside put walls remained intact, and GEX clusters acted as magnets rather than traps. With $VIX near 14.91, I read this as orderly fear rather than complacency, and the term structure continues to point toward normalisation rather than stress.
๐ Global Macro Currents
On the global front, alignment with US strength remained intact. Europe stayed steady, Asia constructive, and China stabilised without FX stress. FX markets remained range bound, supporting carry and broader risk assets. Commodities were selectively bid, with industrial metals reflecting demand rather than inflation panic, while energy stayed contained. Geopolitical developments, including US actions affecting Venezuelan oil flows and Germanyโs evolving China posture, added noise but did not disrupt broader stability. PMI data showed US activity cooling but still expansionary, with services at 55.0, exceeding forecasts.
The AI risk debate remains central to my macro lens. Concerns around hallucinations and scaling limits persist, yet physical constraints highlighted by compute scaling data deserve more attention. The approach toward a latency wall, limits on data movement between chips, and practical ceilings on GPU utilisation even with A100 and H100 class hardware stand out to me as optimisation and interconnect challenges, not thesis killers. These dynamics continue to reinforce demand for advanced memory, networking, and system level solutions.
Valuation math around AI remains compelling in my framework. Projections indicate AI driven incremental revenues could reach ~$8T over 10 to 15 years, with a $5T to $19T range. Applying a 20% margin yields ~$1.6T in profits, and even a conservative 22X multiple implies ~$35T in valuation upside, compared with the ~$24T increase in S&P 500 market cap since late 2022. Sales multiple frameworks implying $25T to $40T of upside reinforce my view that valuations are not yet extended if productivity and margin uplift materialise.
Regulatory and strategic developments also matter. The FTC formally ending its review of Nvidiaโs $5B stake in Intel cleared the path after NVDA purchased INTC shares at $23.28 in Sept 2025. Pairing Nvidia GPUs with Intel CPUs and x86 architecture strengthens enterprise AI and inference economics in my assessment. Reports that SpaceX is interviewing banks for a potential IPO, with Morgan Stanley, JPMorgan, and Goldman pitching, further signal private market AI and space assets moving closer to public capital markets.
๐งญ Risk Positioning Insight
With just 6.5 trading days left in 2025, a symbolic milestone also comes into focus. Warren Buffett is approaching his final 6.5 trading days as CEO of Berkshire Hathaway $BRK.B, and that matters psychologically. To me, it marks a regime transition from legacy capital discipline toward a market increasingly comfortable with duration risk, AI capex cycles, and valuation expansion. Behaviour into year end remains my guide, and liquidity continues to look constructive with rotation persisting rather than retreating.
Positioning data reinforces that view. Hedge fund net exposure has risen methodically, ETF flows remain positive, correlations are contained, liquidity stress is absent, and dark pool behaviour continues to align with accumulation rather than distribution. Strengthening crypto correlations, with Bitcoin volatility acting as a sentiment amplifier rather than a destabiliser, further support my view that factor rotation, not forced de risking, defines this environment.
๐ Conclusion
As I head into the final stretch of 2025, this remains a momentum driven market supported by structure, breadth, and liquidity. Volatility compression, respect for breakout levels, and orderly rotation continue to define the regime rather than fragility. The shortened trading week ahead is firmly on my radar, with US equities closing early at 1:00pm ET on 24Dec25 and markets closed on 25Dec25, knowing thinner liquidity can amplify both momentum and reversals. The dominant signals remain risk on, with accumulation prevailing, breakdowns failing, and cross asset confirmation intact.
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