MW Why out-of-favor Apple holds the key to tech stocks in the coming weeks
By Barbara Kollmeyer
Fundstrat's Mark Newton is watching Apple's moves closely
Following two straight record-busting sessions for the S&P 500 SPX and Nasdaq COMP, the new quarter and second half looks ready to kick off with some losses.
Granted it's an event-filled, holiday-shortened week with Trump's tax and spending bill also currently battling its way through Senate, so some investor fatigue is understandable.
Still, even if markets are facing a possible lull around Friday's Independence Day holiday, in July's favor is a historically bullish seasonal trend seen in past post-election years, says Mark Newton, head of technical strategy at Fundstrat.
The stock market could just keep pushing higher until consolidation - sideways action - kicks in for August, Newton tells clients in a new note. That's as he spies signs the rally is just starting to broaden, with minor technical breakouts by the Dow industrials DJIA and Invesco S&P 500 Equal Weight ETF RSP.
In our call of the day, Newton has a bigger point to make, flagging Apple $(AAPL)$ as a crucial stock to watch in the coming weeks and player in tech outperformance. That follows Monday's action in which Apple busted out of a period of consolidation that had lasted about a month, he said.
Down 18% this year, Apple has underperformed its major technology rivals, with only Tesla $(TSLA)$ worse off - down 21%. The iPhone maker's stock has taken a beating in the first half of this year as investors have fretted over tariff fallout and lack of AI progress.
Albeit in a rising market, Apple shares rose over 2% on Monday. Newton credited that to a report the company is considering using outside artificial intelligence and shifting away from its in-house tech to power a new Siri version, marking a "significant reversal" in strategy. He noted that the stock closed at multiday highs and its best closing level since mid-May of just over $205 per share after roughly a "month of lifeless trading."
While that's just one session, it matters as the tech sector sets up for a "challenge of all-time highs versus the S&P 500 in equal-weighted terms."
"Overall, it's essential for Apple to climb above $214 technically to have conviction about a larger rally getting under way," said Newton, who adds that the S&P 500 has made a 27% push higher since early April, with Apple hardly helping from mid-May onward.
In tech's favor - Newton measures the performance based on the Invesco S&P 500 Equal-Weight Technology ETF RSPT - tech has seen some bullish technical developments. Those include recouping former lows that stretched back to 2024 that helped jump-start a push higher for the sector.
Newton said he suspects a test of all-time highs for technology might become temporary resistance, similar to how the lows tested in 2024 served as support several times before being pushed through earlier this year.
The path for tech stocks is this, he said: An outperformance into August, before stalling out and possibly reversing lower into September, then following that period of consolidation, another push higher into the final quarter of 2025.
When looking at a chart of the Invesco Tech ETF versus the Invesco S&P 500 Equal Weight ETF RSP, Newton concludes that technology has "come back with a vengeance," even though Apple has been sideways trading since May.
"Any ability of Apple to make upward progress heading into July likely could help technology's recent outperformance continue," said Newton.
The markets
U.S. stock futures (ES00) (YM00) (NQ00) are shifting lower, with Treasury yields BX:TMUBMUSD10Y BX:TMUBMUSD02Y also mostly falling. The dollar DXY is lower and gold (GC00) is rising.
Key asset performance Last 5d 1m YTD S&P 500 6204.95 2.98% 4.53% 5.50% Nasdaq Composite 20,369.73 3.76% 5.86% 5.48% 10-year Treasury 4.215 -8.10 -25.50 -36.10 Gold 3340.5 -1.29% -1.93% 26.57% Oil 64.82 -3.57% 2.82% -9.81% Data: MarketWatch. Treasury yields change expressed in basis points
The buzz
Tesla shares $(TSLA.UK)$ are down 3% as a fresh war of words erupts between CEO Elon Musk and President Trump threatened to cut subsidies on Musk's companies and cancel Tesla and SpaceX contracts.
The Senate has been debating Trump's tax and spending bill through the night. Some warn proposed Medicaid and food assistance cuts will imperil the U.S. social safety net.
Fed Chairman Jerome Powell will address the European Central Bank's Forum in Portugal at 9:30 a.m.
Construction spending, job openings and the Institute for Supply Management's June manufacturing survey are all due at 10 a.m. Auto sales also is on tap.
Best of the web
Amazon is on the cusp of using more robots than humans in its warehouses.
This fund returned 21% in May alone buying 'left-for-dead' stocks - and it has a new target.
Unilever cuts off funding for Ben & Jerry's foundation amid tensions over Gaza, audit.
The chart
Despite new S&P 500 highs, Deutsche Bank strategists see "few signs of strong bullish sentiment and risk appetite." Their chart shows how equity positioning has bounced strongly off the bottom in the spring, but remains well below February levels. The strategists noted that U.S. equity fund flows since February are in step with "typical seasonal patterns" and credit "continued robust buybacks" with pushing equities back to records.
Top tickers
These were the most active tickers on MarketWatch as of 6 a.m.
TSLA Tesla NVDA Nvidia GME GameStop PLTR Palantir Technologies AAPL Apple BBAI BigBear.ai PLUG Plug Power WOLF Wolfspeed AMD Advanced Micro Devices TSM Taiwan Semiconductor Manufacturing AMZN Amazon.com
Random reads
Beware of New York's pink 'Foot Fountain.'
Barcelona soccer club crushing it with new kitty mascot.
Giant rabbit tosses first pitch for Reno Aces.
-Barbara Kollmeyer
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
July 01, 2025 06:40 ET (10:40 GMT)
Copyright (c) 2025 Dow Jones & Company, Inc.