Tech Stocks on a Tear

🤝 Tech stocks are currently up big, can we expect them to stay the course or come crashing down?

June 19, 2025

Silver banana goes to…



In this issue of the peel:

  • ✈️ Markets remain flat as tensions continue between Iran and Israel, with the extent of America’s involvement still uncertain.

  • 🛢️ The FOMC met again yesterday and held rates steady, with many expecting two rate cuts this year.

  • 🤝 Tech stocks are currently up big. Can we expect them to stay the course or come crashing down?

Market Snapshot

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  • Homes built differently: BOXABL homes are manufactured in our Las Vegas factory, folded for transport, and then unfolded on-site in just an hour.

  • BOXABL milestones:

    • Delivered a prototype order to SpaceX in 2020.

    • Project order for 156 homes from the DoD completed in 2021.

    • Built over 700 homes to date.

    • Actively delivering to both developers and individual consumers.

    • Reserved the Nasdaq ticker symbol $BXBL!

    • Raised over $200 million from over 50,000 investors since 2020.

BOXABL’s crowdfunding round will close on June 24th. This is your opportunity to invest in BOXABL's offering at just $0.80 per share. 

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*Reserving a Nasdaq ticker does not guarantee a future listing on Nasdaq or indicate that BOXABL meets any of Nasdaq's listing criteria to do so.

Macro Monkey Says

Fed Maintains Rates and Warns of Impending Inflation

During the early hours of the markets, prior to Jerome Powell’s press conference, the markets were decently optimistic despite the ongoing tension in the Middle East. Then Jerome Powell held his press conference in late market hours, warning of impending tariff-induced inflation, which concerned equity investors and drove markets to a flatline. 

In his press conference, Jerome Powell stated that the FOMC expects “a meaningful amount of inflation to arrive in the coming months.” 

If Jerome Powell and the FOMC are correct about incoming inflation, then even a quarter-point rate cut could be disastrous for the U.S economy. This is simply because the rate cut would increase demand, worsening the potential effects of inflation, making it significantly more difficult for the Fed to reverse. 

Additionally, cutting rates while inflation is on the rise is a quick recipe for stagflation because of high inflation coupled with stagnant growth fueled by a potential supply shock. 

Despite these potential consequences of a premature rate cut, there has not been an uptick in inflation or unemployment as reported by the BLS (Bureau of Labor Statistics), begging the question of whether inflation is on its way. 

A potential reason that inflation has yet to appear in CPI reports is that many businesses offered pre-tariff pricing during the tariff pause, bolstering demand and overall sales in general. 

That is also a likely reason why retail sales decreased in May, simply a product of diminishing demand due to goods and services no longer being discounted before businesses were potentially forced to hike prices to conserve margins. 

The Takeaway?

Regardless, there is still another month until June’s CPI report, which should be quite indicative of whether Powell and the FOMC are correct about impending inflation as a product of tariffs. Until then, market movements will likely be dominated by the current conflict between Israel and Iran. 

Career Corner

Question

I have been speaking with some upperclassmen at my school, BC, and many of them have advised me that when emailing banks that target us, we should always use our school email. Is there a way I can access the correct inbox for my school email and separate everything into a separate folder? If not, is there any validity to what they're saying? Their rationale, from interns, is that banks automatically sort emails from certain domains.

Answer

Unless the school email is run through Gmail, I don't think Right Inbox will work.

For alums, if upperclassmen are telling you that, I'd listen to them and use your Gmail and right inbox for the non-alums.

Head Mentor, WSO Academy

What's Ripe

TMC the metals company Inc. (TMC) 24.3% 

  • TMC’s stock price has absolutely exploded in the past 5 days, increasing by 57.34% during that span. TMC’s winning streak started on June 16th when Korean Zinc made an $85 million investment, and announced yesterday that it had amended previous terms for issued stock warrants. 

  • TMC also assured investors that they would limit the amount of additional shares issued from warrants, limiting further dilution. 

Scholar Rock Holding Corporation (SRRK) 16.6% 

  • Scholar Rock, a biopharmaceutical company, recorded significant gains during market hours due to positive results from its EMBRAZE trial. During the trial, they tested a weight loss drug that resulted in 12.3% weight loss on average for the participants. 

What's Rotten

Freedom Holding Corporation (FRHC) 6.5%

  • Freedom’s stock price has plunged significantly recently, down about 22% in the past month. After reporting earnings in May, despite solid revenue growth, Freedom’s EPS plunged, and investors have been losing confidence ever since. 

Mastercard Inc. (MA) 5.4%

  • Mastercard’s stock sank yesterday after companies like Amazon and Walmart stated that they were exploring issuing their own stablecoins. This could result in Amazon and Walmart bypassing Mastercard’s fee-based model, which would be a significant hit to Mastercard’s business.

Thought Banana

Are Tech Stocks Currently Inflated?

From the peak of the dot-com bubble in 2000 to the trough that came soon after, the NASDAQ fell about 78%, and took over 15 years to recover fully. While tech stocks are definitely not as inflated now as they were in 2000, there is an argument to be made about investors' bullish sentiment towards their performance. 

The dot-com bubble occurred because of revenue-less tech IPOs with ridiculous valuations, essentially based on speculation. While the hype surrounding artificial intelligence is far from baseless, it could be considered by some to be slightly inflated. 

The current risk involved with AI stocks is that for many of them, current and future growth is priced into their earnings, with some of them trading at over 100x price/earnings. 

Consequently, as a result of priced-in growth, if there is eventually a roadblock where the applications of AI in their current state reach a ceiling and cannot continue to grow at an exponential rate, it could cause a mass selloff of AI stocks. 

On the other hand, the technology sector has had an extremely successful earnings season, with companies like Nvidia meeting expectations despite trade tensions. Something else to consider is the weighting of the technology sector in the major indices. 

For example, about 32% of VOO’s (an ETF that tracks the S&P 500) holdings are within the technology sector, which goes to show how robust earnings calls have been within the tech sector. More tech-heavy ETFs like QQQM, which tracks the NASDAQ 100, have about 53% of their holdings within the technology sector. 

Therefore, if AI growth falls short of investor expectations in the short term, it is possible that the market could witness a tech selloff due to inflated expectations of AI growth. While the applications of AI are still being realized and AI itself is still rapidly advancing, investors should be cautious about the growth they are assuming for technology and AI companies. 

The Takeaway?

Despite the fact that there is undoubtedly money to be made investing in AI stocks, we would urge investors to be cautious when dumping their money into only tech stocks, as diversification is likely the best protection against mass selloffs. 

Furthermore, we urge investors to exercise even greater caution when considering recently IPO’d AI startups and to prioritize thorough research before making an investment.

The Big Question: How long can tech stocks defy gravity before fundamentals catch up?

Banana Brain Teaser

Previous

The present ratio of students to teachers at a certain school is 30:1. If the student enrollment were to increase by 50 students and the number of teachers were to increase by 5, the new ratio would be 25:1. What is the present number of teachers?

Answer: 15

Today

If [x] is the greatest integer less than or equal to x, what is the value of [-1.6] + [3.4] + [2.7]?

Send your guesses to [email protected]

❝

I’m only rich because I know when I’m wrong… I basically have survived by recognizing my mistakes.

George Soros

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Happy Investing,
Chris, Vyom, Ankit, Mithun, Colin & Patrick