Is This An Inflection Point?

*Analyzing the markets with Richie Naso, a Wall Street veteran of over 40 years and former member of the NYSE.

(Market Close 10th July 2026)

The Russell 2000 continued to underperform despite the broader market’s resilience. Small-cap stocks faced headwinds from higher Treasury yields and a renewed preference for mega-cap technology names. While the Russell remains one of the year’s strongest-performing major indexes, this marked its second consecutive weekly decline, suggesting investors are becoming more selective after a strong first-half rally.

HYG — Junk Bond Watch

High-yield credit remained relatively stable this week, signaling that credit markets are not pricing in a meaningful deterioration in economic conditions. This remains an encouraging sign for equities, as widening credit spreads often precede broader market weakness. While HYG was not a major market driver this week, it continues to support the view that financial conditions remain constructive.

Why it mattersforstocks:

• When HYG is strong, it suggests investors are comfortable taking risk and credit markets remain supportive of equities.
• When HYG weakens, it often signals growing concern about economic growth, rising default risk, tighter financial conditions, or declining liquidity.

Technology Takes the Lead Again

Source: Reuters

Semiconductor and AI-related stocks regained leadership this week. Investor enthusiasm was fueled by expectations for strong second-quarter earnings and optimism ahead of Taiwan Semiconductor’s earnings report. NVIDIA, Broadcom, and other AI-related companies helped drive the Nasdaq’s outperformance.

Interest Rates

Source: Investor’s Business Daily

Treasury yields moved modestly higher during the week as investors awaited June CPI and PPI inflation data. The bond market continues to assess whether inflation is cooling fast enough to support additional Federal Reserve rate cuts later this year.

SA Analyst Sees Bullish Setup Despite Nasdaq’s Rangebound Trading

Source: Seeking Alpha — Alex King, Cestrian Capital Research (subscription may be required)

Wall Street ended modestly higher on Friday as investors looked ahead to the U.S. market debut of South Korean memory chipmaker SK Hynix, while extending gains from the previous session’s technology-led rally. The Dow edged up 0.2%, the S&P 500 climbed 0.4%, and the Nasdaq Composite added 0.2%.

Despite the relatively quiet session, Seeking Alpha analyst Alex King of Cestrian Capital Research said the broader market backdrop remains constructive heading into the second half of the year.

“A very strong finish to the week for the S&P 500.”

— Alex King, Cestrian Capital Research / Seeking Alpha

King described the Nasdaq’s recent performance as increasingly rangebound, with competing trends within the technology sector creating a tug-of-war between semiconductor companies and software firms.

“The Nasdaq continues to trend sideways in a rangebound fashion as the yin and yang of semiconductor and software continue to butt heads.”

— Alex King, Cestrian Capital Research / Seeking Alpha

Looking ahead, King maintained a bullish outlook through the upcoming midterm elections and pointed to renewed activity in digital assets as another sign of improving risk appetite among investors. These are the views of a third-party analyst and are not aguaranteeof future market performance.

HSBC’s Top Picks Heading Into Earnings Season

Source: Seeking Alpha — HSBC analyst Nicole Inui (subscription may be required)

The following stocks represent Buy ratings issued by HSBC analyst Nicole Inui and her team ahead of second-quarter earnings season. These are third-party analyst opinions only and do not constitute investment advice or a recommendation from TradeZero or Richard Naso to buy, sell, or hold any security. Analyst ratings and price targets are not aguaranteeof future performance. Past performance is not indicative of future results.

With second-quarter earnings season kicking off, HSBC analyst Nicole Inui and her team have identified 10 Buy-rated stocks they believe are positioned to outperform across technology, financials, consumer, and industrials sectors. (You can find the source of the information displayed below here)

Source: Barron’s (subscription required). Analyst ratings and price targets referenced below are third-party views from BMO Capital Markets analyst Tristan Thomas-Martin and are not investment advice.

Key Points

• BMO Capital Markets analyst Tristan Thomas-Martin initiated coverage on four major cruise companies, rating Royal Caribbean and Viking Holdings at Outperform.
• Thomas-Martin rated Carnival and Norwegian Cruise Line Holdings at Market Perform.
• Cruise stocks fell across the board midweek after President Trump said the latest Iran War cease-fire had ended.
  

In the early days of the pandemic, it seemed COVID-19 might put an end to cruising, given ships’ reputation for being a vector for illness. Yet demand rebounded quickly, as cruises have been cheaper than land-based vacations in recent years, allow for multigenerational travel, and feature exclusive experiences and private islands.

Demand has largely held up, but investors cannot count on a rising tide lifting all cruise stocks. The still-unresolved Iran War is one issue. Oil prices have come down from their conflict peak but remain elevated, representing a headline risk for the sector. While companies can pass on increased fuel costs to consumers, they risk some demand destruction — especially among lower-income passengers — and sustained high energy prices reduce disposable income available for vacations.

BMO analyst Tristan Thomas-Martin initiated coverage of the four major cruise companies, rating Royal Caribbean (RCL) and Viking Holdings (VIK) at Outperform, with price targets of $370 and $115, respectively. He has Market Perform ratings on Carnival Corp (CCL), which he thinks should trade to $30, and Norwegian Cruise Line Holdings (NCLH), with a $21 target. These are analyst price targets and not a guarantee of future stock performance.

“Valuation is pricey, but we think you get what you pay for.”

— Tristan Thomas-Martin, BMO Capital Markets — on Viking Holdings

Viking has more than doubled since Barron’s recommended it just over a year ago, citing its loyal and wealthy clientele and dominance in the river cruise market. Thomas-Martin concurs, noting top-tier metrics including a return on invested capital of 53% at the end of 2025, exceeding all publicly traded rivals, and expected earnings per share growth of roughly 27% this year and 31% next year.

Royal Caribbean is not far behind, with expected earnings growth of roughly 10% this year and 15% next year. It has risen some 240% in the past five years, whereas Carnival is up just 5% and Norwegian is in negative territory over that period. Past performance is not indicative of future results.

“Royal Caribbean is our top pick in the cruise sector, having optimized cruise — both keeping cruisers in its ecosystem and attracting new cruisers — and thinking about the next leg of the industry’s growth via an expanding portfolio of shore offerings and entrance into the river segment.”

— Tristan Thomas-Martin, BMO Capital Markets

Carnival’s earnings are near break-even for the year, with Norwegian’s EPS declining from the year-ago period. Both are expected to return to double-digit growth next year, and it is worth noting that Carnival has meaningfully reduced its debt load. However, Thomas-Martin says he struggles to find a near-term catalyst for Carnival beyond industry tailwinds, especially as management has adopted a more cautious tone about the rest of the year.

Norwegian, he writes, raises the most questions in the cruise space, given results lagging peers, activist involvement, and a tough competitive backdrop against well-established rivals.

What I’ll Be Focused On This Week

The items below reflect Richard Naso’s personal areas of focus for the coming week and are provided for informational and educational purposes only. They do not constitute investment advice or a recommendation to trade any security.

WATCH LIST — WEEK OF JULY 13, 2026

• Key read on whether inflation is cooling fast enough to support Fed rate cuts
• Producer prices as a leading indicator of consumer inflation
• Critical bellwether for AI chip demand and semiconductor sector direction
• The unofficial start of Q2 earnings season

These events will help determine whether the recent AI-led rally can broaden into the rest of the market, or whether higher interest rates continue to weigh on small-cap and cyclical stocks.

Richie’s Take

The market continues to reward companies tied to artificial intelligence and earnings growth, while economically sensitive sectors and small caps are showing signs of fatigue. The divergence between the Nasdaq and the Russell 2000 suggests investors remain willing to pay a premium for quality growth but are becoming more cautious toward riskier areas of the market.

Near term, the market appears to be approaching another inflection point. Strong earnings and benign inflation data could fuel another leg higher, while any disappointment — particularly from inflation readings or AI-related guidance — could trigger increased volatility after a powerful advance. A cautious stance is warranted in the short run, but the longer-term trend remains constructive as long as earnings growth and credit conditions stay supportive.

— Richie

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