Micron Earnings – The Evolution of the AI Trade

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What’s in Today’s Report:

  • Micron Earnings – The Evolution of the AI Trade

Futures are lower led by tech as a global selloff in chipmakers continues amid AI infrastructure concerns.

South Korea’s KOSPI fell nearly 6% as losses in Samsung and SK Hynix fueled another round of semiconductor selling while reports that OpenAI could delay plans to go public are also weighing on sentiment.

Today focus will be on Trade in Goods (E: -$85.2B), Consumer Sentiment (E: 50.0), and Wholesale Inventories (E: 0.3%). Markets will want stable economic data as investors assess the recent tech-led pullback.

Beyond the data, Fed Governor Kashkari speaks at 11:30 a.m. ET. There are no notable earnings today, leaving markets primarily focused on the tech sector and economic data.

 

New ETFs to Watch (Recent Releases)

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What’s in Today’s Report:

  • New ETFs to Watch (Recent Releases)

Futures are moderately higher following blowout Micron earnings and a further decline in oil prices.

Micron (MU) earnings and guidance were much stronger than expected (stock up 17% pre-market) and that’s helping tech and the broader market to rebound.

Oil prices dropped another 1% overnight as insurance rates for Hormuz transit plunged.

Today focus will be on economic data and the key reports are, in order or importance:  Core PCE Price Index (E: 0.3% m/m, 3.4% y/y), Durable Goods (E: -4.7%) and Jobless Claims (E: 225K).  The best case scenario for stocks, which would further the early rally, would be better than expected Core PCE Price Index that eases inflation/rate hike concerns and solid Durable Goods and jobless claims (signaling still solid growth).

There are also two Fed speakers today, the most important of which is Williams (3:40 p.m. ET) and if he downplays rate hike chances, that would be another positive tailwind on markets.  Chicago Fed President Goolsbee also speaks but after the close (6:30 p.m. ET).

 

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Investors Are No Longer Willing To Pay Up Blindly For The Data Center Boom

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Cheap AI stock valuations raise doubts about data center demand

Tom Essaye argues they may be saying something less comfortable: investors are no longer willing to pay up blindly for the data center boom.

Essaye, founder of Sevens Report Research, said in a Wednesday note that cheaper AI stock valuations could reflect fear that the current wave of data center spending may slow. That matters because growth stocks typically receive richer multiples when investors believe future earnings will justify them. When some of the market’s most visible AI-linked names trade close to, or below, the S&P 500’s forward price-to-earnings ratio of 21.5, the message is not simply that shares are inexpensive. It may be that investors are questioning whether the earnings they once expected will arrive.

Essaye framed the risk through a hypothetical example. “Think of it this way: GOOGL (to use one as an example) cancels building 10 data centers because it’s going to cost too much money and the return isn’t there,” he wrote. “That will result in massive order cancellations at NVDA, MU, AVGO, SNDK, etc., because no one needs the chips, networking, memory, or processor power,” he added.

Also, click here to view the full article on Financial-world.org published on June 21st, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

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Tom Essaye Thinks Investors Aren’t Sure The Current Data Center Boom Will Last

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AI chip stocks show low P/E ratios amid investor doubt

Sevens Report Research founder Tom Essaye thinks this is because investors aren’t sure the current data center boom, fueling AI growth, will last.

Tom Essaye warns of massive cancelations.

Essaye compares today’s situation to the dot-com crash in 2000, warning that if market hype doesn’t turn into real growth, suppliers like NVIDIA and Micron could take a hit.
He says inflated expectations can backfire if demand doesn’t keep up: “massive order cancelations” could follow.

Also, click here to view the full article on NewsBytes.com published on June 22nd, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

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The Real Reason Behind the AI/Tech Selloff

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What’s in Today’s Report:

  • The Real Reason Behind the AI/Tech Selloff
  • Composite PMI Takeaways – A Goldilocks Print
  • How Silver and Copper Prices Suggest the AI Angst Is “Real”

Futures are modestly higher this morning as tech shares show signs of stabilizing (Nasdaq futures up ~0.5%) ahead of notable semiconductor earnings from MU due out this afternoon while oil prices continue to favorably decline.

Economically, the German Ifo Survey’s Business Climate headline rose 0.6 points to 85.6 vs. (E) 85.5 helping ease economic worries triggered by yesterday’s Eurozone PMI release.

Today, there are no Fed officials scheduled to speak and just one economic report to watch in the U.S. with New Home Sales (E: 640K) due out shortly after the open.

The Treasury will hold a 4-Month Bill auction at 11:30 a.m. ET and a 5-Yr Note auction at 1:00 p.m. ET; if demand for either is weak, yields could turn higher again which could act as a renewed headwind on equity markets.

Finally, there are a few noteworthy earnings releases today with PAYX ($1.31), JEF ($1.09) and most importantly MU ($20.81) all due to report quarterly earnings. Given the recent volatility has been concentrated in tech/semis, the market will be looking for strong results and guidance from MU after the close today to help the market continue to stabilize.

 

That Will Cause Some Upset For Markets Tom Essaye Tells Barron’s

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For something that has been working really well for markets, that will cause some upset, Tom Essaye tells Barron’s.

S&P 500 Drops 1.2% After Warsh Hints of Fed Changes

Sevens Report Research’s Tom Essaye told Barron’s the market reacted to the “litany of changes that Warsh is proposing” that could lead to uncertainty and less communication from the central bank.

“The Fed was not hawkish, nor was Warsh hawkish,” Essaye says. “What he said was that ‘I’m exploring changing everything. And for something that has been working really well for markets, that will cause some upset.”

Also, click here to view the full article published in Barron’s on June 17th, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

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Tom Essaye Says Cheap AI Stock Valuations Could Signal This

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Tom Essaye said that cheap AI stock valuations could signal that investors are growing fearful that the data center boom could come to a halt.

‘Exactly how the dot-com bubble burst’: A market research firm says keep an eye on this AI warning sign

Tom Essaye, the founder of Sevens Report Research, said in a note on Wednesday that cheap AI stock valuations could signal that investors are growing fearful that the data center boom could come to a halt.

Typically, investors are willing to assign higher valuations to growth stocks because of their high future earnings potential. So the fact that some AI stock valuations are so low today means investors are skeptical that earnings potential will ever come to fruition, Essaye said.

“Think of it this way: GOOGL (to use one as an example) cancels building 10 data centers because it’s going to cost too much money and the return isn’t there,” he wrote. “That will result in massive order cancellations at NVDA, MU, AVGO, SNDK, etc., because no one needs the chips, networking, memory, or processor power,” he added.

A recent example of investor uneasiness, Essaye said, is the recent decline in Oracle stock. Shares of the company have tumbled about 25% since June 1 as it’s poured money into the AI buildout.

“To be fair, this fear has been around for several months, and it isn’t appearing yet. However, it’s not without precedent because this is exactly how the dotcom bubble burst,” he said.

“While people connected to the internet, their connection wasn’t nearly as profitable as quickly as everyone assumed,” Essaye continued. “Because of that, the buildout stopped.”

Also, click here to view the full article published in Business Insider on June 19th, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

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Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.

Tom Essaye Has Raised Caution For Investors

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Market research company warn of AI stocks selling cheap; say they point to a ‘dangerous sign’

Market research company, Sevens Report Research founder Tom Essaye has raised caution for investors that the relatively cheap valuations of several high-flying AI stocks may not be the buying opportunity they appear to be. According to a report by Business Insider, in a note, Eassye said that the low forward price-to-earnings (PE) ratios could reflect the growing fears that the data center boom may stall. For comparison, the S&P 500 trades at a forward PE of 21.5. Essaye noted that growth stocks typically command higher multiples because of their future earnings potential. The fact that AI stocks are trading at relatively low valuations suggests skepticism about whether those earnings will materialize.

Essaye further warned that if AI adoption falls short, companies could cancel large-scale data center projects, leading to “massive order cancellations” for chipmakers and hardware suppliers. He cited Google as an example: “If GOOGL cancels building 10 data centers because the return isn’t there, that will result in massive order cancellations at NVDA, MU, AVGO, SNDK, etc.”

Also, click here to view the full article on MSN.com published on June 22nd, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

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SpaceX Thoughts: TSLA on Steroids

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What’s in Today’s Report:

  • SpaceX Thoughts: TSLA on Steroids

Futures are lower, led by tech (Nasdaq futures down ~3%) as a heavy selloff in Asian chipmakers including in a ~10% drop in the South Korean KOPSI index, is dragging broader equity markets lower amid valuation and capex worries.

Today, focus is likely to be on whether the pre-market selloff in tech stocks accelerates or stabilizes as trading gets underway on Wall Street, however there are also a few noteworthy economic reports to watch, including the Flash Composite PMI (E: 51.2), and the Richmond Fed Manufacturing Index (E: 8.0).

There are no Fed officials are scheduled to speak today which will leave fixed income markets primarily focused on the economic data and the 2-Yr Treasury Note auction at 1:00 p.m. ET this afternoon.

Finally, there are a few important earnings releases due to be released today including: CCL ($0.34), FDX ($5.91), and CBRS (-$0.14).

Regarding the economic data, investors will be looking for “Goldilocks” data with healthy growth and cooling inflation and strong earnings in order for the market to stabilize from the pre-market rout.

 

Tom Essaye Notes That The Sustainability Worries Are Still Valid

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Practically, I don’t think this means anyone needs to reduce tech exposure today, Tom Essaye tells Barron’s.

Tech Stocks Are Cheap? That’s a Problem Too.

Essaye notes that the sustainability worries are still valid, highlighted by Oracle’s recent report.

“Using simple math, it appears that Oracle will have a close to 100% sales/capex ratio in 2027,” writes Essaye. “To keep things simple, that means Oracle will spend all of its revenue on capex, the vast majority of which will go into AI infrastructure. That means that Oracle will almost certainly have negative free cash flow and that is only sustainable for so long, even for a company like Oracle.”

Here is where the dot-com bubble comes back into play, Essaye notes, because the current AI buildout could wind up being similar to the widespread effort to build fiber access to the internet to homes across the country in the late 1990s. That demand turned out to be unsustainable, as connecting people to the internet wasn’t as profitable as initially hoped.

“Practically, I don’t think this means anyone needs to reduce tech exposure today,” Essaye concludes. “But this situation (i.e., are earnings gains sustainable?) is something that needs to be watched, so ensuring one isn’t too overweight tech and has proper balance remains important.”

Also, click here to view the full article published in Barron’s on June 17th, 2026. However, to see the Sevens Report’s full comments on the current market environment sign up here.

If you want research that comes with no long term commitment, yet provides independent, value added, plain English analysis of complex macro topics, then begin your Sevens Report subscription today by clicking here.

To strengthen your market knowledge take a free trial of The Sevens Report.

Join hundreds of advisors from huge brokerage firms like Morgan Stanley, Merrill Lynch, Wells Fargo Advisors, Raymond James, and more! To start your quarterly subscription and see how The Sevens Report can help you grow your business, click here.