☕️ Before you react to today’s market action, remember this

Howdy! 👋  

It’s Friyay but looking at the early market action, you’d never know it. 

Stonks have sold off hard as – you know – AI spending fears roil the chip makers. 

Sigh. 

We’ve seen this more times than we can count and talked about it more still. 

Markets reset periodically for a variety of reasons. 

This morning it’s a combination of the reaccelerating war in Iran, oil prices and rising yields – all of which means the cost of leverage has gone up and, with it, the need to sell shares in anything hotter than normal – like oh, I dunno, chips. 

Here's the numbers behind what I’m saying. 

The 10-year touched 4.62% earlier this week and is still holding stubbornly up near 4.60% which is the bond market’s way of pricing in a war that refuses to end. Meanwhile WTI's sitting around $79.65 a barrel, up more than 11% on the week, with Brent closing near $84 on Thursday. 

As for chips stocks, they’re always first “on sale” when the cost of leverage rises because they’ve got less room for error and even less room to absorb multiple compression. 

In other words, situation normal. 

Run for the hills if you want but know that the markets are the only store on earth where customers fear a sale. 

The underlying case for owning the world’s best companies is getting a lot stronger, particularly if they continue to put up good numbers. 

Once upon a time selloffs like this were driven by fundamentals but these days not so much. In fact, my research suggests that roughly 84% of daily volatility is now driven by market structure, not stocks themselves. 

Think about that for a moment. 

There’s a 98% correlation between earnings and price over time which means that if earnings remain strong… guess what follows over time? 

Yep. 

Price. 

So when you’ve got a “sale” on your hands because others don’t understand the relationship, guess what history also clearly suggests you should be doing? 

Yep, again. 

Buying. 

Not blindly, mind you but buying the world’s best companies particularly those making “must have” products and services the planet can’t live without. Contrary to what many believe, it’s actually a pretty short, sharp list. 

Anyway, enough of that. 

The slide I’ve just shared with you is from one of the presentations I’ll be delivering tomorrow at Shindig ’26, our annual conference for the One Bar Ahead® Family… and I’ve got to get on the road this morning to meet up with OBAers who are coming from around the world to attend. 

Other topics include: 

• What my latest research says about volatility, market structure and which stocks could benefit most 
• Optimizing entries and exits using proprietary OBA Indicators 
• Required Minimum Distribution (RMDS) 
• How to read an annual report in less than 10 minutes (without wanting to set it on fire) 
• The biggest risk – no matter what your age or investing stage – and how to overcome it 
• And more. 

It’s always a great time and, as usual, I’m super excited to see everyone – including YOU if you’re on your way, too. If not, next time! 

Meanwhile and before I head out the door: 

• Netflix reported roughly in-line Q2 results (EPS slightly beat, revenue slightly missed), but the stock fell as investors were disappointed by the forward guidance and reduced engagement-reporting transparency. I said on Monday that I’d be interested in a dip but the fact that the company plans to reduce visibility into user metrics nixes that idea. 🤦‍ 
• Apple continues to hit new all-time highs. Funny how that works after the naysayers have been writing ‘em off and insisted the company was “done.” (Read) 
• PayPal is reportedly rejecting Stripe and Advent's offer as inadequate. 
• SpaceX falls further below IPO price and is now ~40% off highs of $225.64 — just as I suggested could happen. (See #5) 
• I've repeatedly warned investors to steer clear of publicly traded fast food stocks — and while my original concern was margin-eroding discount wars, this week is a reminder that there's more than one way this sector can bite you. Taco Bell is now pulling lettuce and other ingredients nationwide after a multistate Cyclospora outbreak was traced to one of its suppliers. 
• Oil prices rose on escalating U.S.-Iran tensions overnight. (Read) 

The "yeah but" crowd is having a field day because they’ve told you this was coming. 

Indeed… many are so good and so consistent that they’ve called 22.5 of the last two actual corrections, selloffs, pullbacks… whatever you want to call ‘em. 

Investing in optimism beats cowering in fear, especially on days like today. 

Since 1871… 

• There have been 151 rolling 5-year periods, 87% of which have been profitable. 
• There have been 146 rolling 10-year periods, 96% of which have been profitable. 
• There have been 136 rolling 20-year periods, 100% of which have been profitable. 

Once again, and at the risk of sounding like a broken record — the cost of missing opportunity is always more expensive than trying to avoid risks you can't control. 

Bottom Line 

Uncertainty always paves the path to profits others can’t imagine.   

Now and as always, let's MAKE it a great day and finish the week strong. 💯 

You got this — I promise! 

Keith 😀