Micron Earnings Could Decide the Next Move for AI Stocks

In pre-market trade, we're looking at US stock futures in positive territory, and we are looking at an attempt for tech to stage a rebound after the sharp sell-off this week.

Now on Monday as well as Tuesday, tech investors growing increasingly jittery over massive AI caps as well as the growing likelihood of Federal Reserve rate hikes and of course in New York morning trade we're continuing.

To keep an eye on oil prices edging lower as peace talks between the US and Iran show real progress.

Well joining me this morning to weigh in is Matt, equity trader at Virtue Financial.

Matt, good morning.

Thank you so much for joining me.

Good morning, Rey.

How are you doing well.

While we are counting down to the second half of 2026, and of course AI is front and center.

This morning ahead of Micron earnings.

So what do you make of some of the volatility we've been seeing in tech, in particular memory hyperscales as well as semiconductors?

Wow, I mean there's a lot to unpack here today, you know, it's for a quiet day, you know, we're setting up for Micron tomorrow.

You talk about AI.

Micron has been the darling of AI here, so that's going to be a huge focus tonight.

Um, you know, we saw a bit of a sell-off over the last couple of days.

Not surprising after the run up we've had, we've seen rotation into some other names while the Dow is comprised of some other names that may not be so tech-heavy until Alphabet gets in.

You know, we've seen some moves higher in those names and we've seen some selloff and weakness in the AI names, but certainly we're going to get back involved in them.

You know, I think we need some further confirmation from companies like Micron, you know, some money that had been taken out for SpaceX the whole time may now plowed into the AI names in the second half of 2026.

Yes, and Matt, as you mentioned, there are a lot of.

Parts when it comes to artificial intelligence with the technology as the investment and as we count down to the closing bell and the results coming out from Micron, we have to keep in mind that there are some lofty expectations for earnings results.

So we'll see what happens in terms of those results and the market action after the market does actually close.

But at the same time we have to keep in mind since.

Mentioned rotation.

What's happening in terms of sectors?

So what are you seeing in terms of leaders and laggards, especially given the geopolitical situation?

Well, you know, the financials acted super and on a quiet basis.

We're not even really talking about them at all.

So you know those are going to be ones with a huge IPO like SpaceX.

You know how much money are these banks going to be looking to make as we go into 3rd quarter.

As they report second quarter earnings, so those are ones I think that have been quietly moving higher and rewarding investors because you know they're patient.

You're not seeing these 10% moves in the financials.

You're seeing these really gradual gains, which is old school because people are so used to making 20-30% in a day or losing 20 or 30% in a day, which is kind of casino-like.

Yeah, absolutely.

And another thing that we're watching this week in less than 24 hours we'll get more inflation data regarding the US economy in the shape of PC figures, and we have to keep in mind that we have a new Fed at the central banks.

So given the changing of the guard and. for that PC figure, what could we possibly expect when it comes to the outlook for central banks?

We'll see if the PCE continues to be the Fed favorite, you know, I mean, maybe we have a new Fed chairman that's going to look at inflation another way because 2% inflation just isn't viable anymore.

It's just not there.

You know, but I, you know, when you strip out food and energy, those are the most volatile things.

That's what America cares about.

That's Main Street.

So you know, I think we need to start looking at those kind of indicators which include that, you know, we're starting to see energy prices come down a little bit.

I know President Trump wants them down quicker and soon.

I think we'd all like that, but you know that's part of it.

So inflation, look, it's unfortunately it's here, but if GDP gets above 3% again as our secretary is hoping for, you know, those are kind of a balancing act.

So you know I think we have to take this number with a bit of a grain of salt with what's going on in Iran, and then we've got to focus on probably the second half more than just this number tomorrow.

And as you mentioned, there are a lot of moving parts here because when we're talking about food inflation, all of us feel that whether we're dining out or shopping at the supermarket here.

So one area I do want to ask about is the bond market and in turn the yields here in the US.

So what is that telling you right now?

Well, you know, I mean.

I know the Fed is going to be at the forefront of this too.

We're starting to talk about possible raising rate environment.

I don't know if that's going to be well received in the White House, certainly with someone that he's put in there.

So the bond market's going to bear watching as we approach coming out of the summer.

I don't think anything can happen until then, so you're going to watch that if the yields keep ticking up, it's something to bear in mind through the summer.

And finally, before I let you go, since we're counting down to the end of the first half of 2026, you've been on the trading floor for many, many years, and you've been through different market cycles as well as policy cycles.

So given the fact that we are about to head into the second half, what do you make of some of the volume as well as volatility we've seen so far?

I mean volatility is here to stay, you know, as I mentioned.

You know, seeing, you know, Micron move 13% yesterday, not even on an earnings report, you know, I mean we are historically seeing these massive tech companies move 1012, 14% after earnings.

So I would imagine we're going to ramp up for that tomorrow with Micron.

So the volatility part is definitely here to say the volumes, you know, the volumes are in the names that that people are involved in, you know, I mean you're going to look at Wendy's.

Over the last couple of days here, you know, I mean that's seen some enormous volume, so that's what retail is focusing on, and retail never was a huge component of the market prior to about 5 years ago.

Now it's massive, and we saw it in SpaceX.

We're starting to see it in these individual names, and that's not stopping anytime soon.

Well, Matt, always great talking to you.

Thank you so much for joining us this morning and thank you so much for sharing all of your insights.

All right, Remy, have a good day.

You too.

Thank you.