0720 | S&P slips on Apple, Tesla; hedge funds sell tech at record pace

Mia: This is After Market, a Bri podcast. I'm Mia.

Milo: And I'm Milo. The S&P 500 slipped, erasing earlier gains after declines in Apple and Tesla weighed on the index and offset advances elsewhere.

Mia: Plus, Goldman Sachs reports hedge funds have sold US tech stocks at a record pace. Money-market funds are turning toward ultra short-term holdings. And Archer shares jumped 20 percent on a new military aircraft.

Milo: Let's start with the broad market. The S&P 500 slipped on Monday, erasing earlier gains. Apple and Tesla declined, and that dragged the index lower even as other areas of the market advanced.

Mia: And chipmakers? They actually rebounded.

Milo: They did. That rebound comes right ahead of a heavy calendar of earnings releases, which are going to test whether Big Tech profits can live up to the elevated expectations that are baked into these stocks.

Mia: So you've got this split picture: Apple and Tesla weighing things down, chips moving higher, and earnings season about to give us the next big signal.

Milo: Now, zooming out, there's a bigger story in who's been selling. Goldman Sachs's prime services desk reports that hedge funds have sold US technology stocks at a record pace over the past two months.

Mia: Record pace. That's worth sitting with for a second. And this is happening while the S&P 500 is erasing early gains and finishing lower, with Apple and Tesla declines offsetting gains elsewhere.

Milo: Right. And those chipmakers we just mentioned, they're rebounding right ahead of this wave of earnings that'll test whether Big Tech profits can actually meet the high expectations. So the question is, are the hedge funds getting ahead of something?

Mia: That's the tension. You've got heavy selling from the pros, but chipmakers are still finding buyers before earnings.

Mia: Let's shift to the fixed-income side. Money-market funds are turning toward ultra short-term holdings and pulling away from assets that carry even modest interest-rate risk.

Milo: So they're keeping cash closer. What's driving that?

Mia: Uncertainty over the Federal Reserve's policy path and the near-term outlook for rates. Funds don't want to get caught holding anything with duration if the rate picture shifts.

Milo: And on Monday, US Treasury yields moved higher while Wall Street watched the latest developments amid escalating tensions in the Middle East. So you've got the Fed uncertainty and geopolitics both pushing funds toward the shortest end.

Mia: That brings us to those Middle East tensions. The US has bombed Iran for nine straight nights in retaliation for repeated attacks on oil tankers in the Strait of Hormuz.

Milo: Oil prices have edged higher after President Trump said Iran would pay for killing American service members.

Mia: And the economic ripple effects are starting to show. Ryanair's first-quarter profit fell 34 percent. The airline says consumers are delaying bookings because of the Middle East crisis, and it warned that struggling carriers face a difficult winter.

Milo: But Ryanair also said there's no shortage of travelers overall. The demand is there, it's just getting pushed back.

Mia: Meanwhile, the situation in the Strait itself is so severe that one shipowner is offering crews an extra six months' pay to sail through it. The decision is being framed as a stark choice between large financial rewards and the risk of death.

Milo: And gold held above four thousand dollars on Monday despite the continued violence.

Milo: We've got a handful of corporate moves to catch up on. Archer shares jumped 20 percent after the company unveiled a military aircraft developed with Anduril, while the firm continues racing fellow eVTOL makers for FAA certification to launch commercial air-taxi flights.

Mia: Alphabet stock rose on a report that it's building a more efficient AI chip, code-named Frozen v2, which would embed parts of its Gemini architecture directly into the silicon.

Milo: AMD launched Helios, its first rack-scale AI system aimed at Nvidia, and disclosed that Microsoft has joined Meta, OpenAI, and Oracle as a new customer.

Mia: Boeing's CEO said the company still needs a couple more years to repair its finances before it can develop a new jet. And TSMC is accelerating construction of its Arizona factory to capture the AI megatrend, according to its CFO.

Milo: And one more: JetBlue won Spirit's slots at LaGuardia Airport and is looking to move into the Marine Air Terminal as carriers compete for space.

Mia: That's After Market from Bri. I'm Mia.

Milo: And I'm Milo. Thanks for listening.