S&P 500 futures are flat ahead of the open while Nasdaq 100 futures are modestly in the red to kick off the week.
Friday’s session saw a curious dynamic among Robinhood’s retail traders…
SpaceX was the most-purchased single stock, on net, after reaching a deal to buy low-band spectrum in a shot across the bow to US carriers.
This acquisition “provides SpaceX with a critical building block should it decide to develop a broader wireless offering, though the spectrum alone remains insufficient to support a nationwide consumer network,” wrote Bernstein analyst Laurent Yoon. “If SpaceX begins deploying the spectrum, investors are likely to focus less on near-term metrics and more on the longer-term implications of a credible fourth facilities-based competitor.”
Telecoms plunged, as did rival space-based broadband firm AST SpaceMobile. And yet all of these stocks — including AT&T, Verizon, and T-Mobile — were also among the 13 most-purchased single stocks in the final trading day of the week.
Every one saw more accumulation than Apple or Micron on the session. In fact, T-Mobile enjoyed its strongest daily net purchases on Robinhood Markets of all time!
“The top formation in the traditional telecom services has been building for months
suggesting the market was anticipating a seismic shift in the landscape,” writes Renaissance Macro head of technical research Jeff DeGraaf. “Other than bounces, be careful with these names.”
As a subsidiary of Robinhood, Sherwood Media is restricted from writing about any company in which Robinhood is or was a selling group member of the IPO during the regulatory "quiet period" for that company.
Momo no mo
I will not run out of ways to show how novel the dramatic swings between factors and industries are this year. (Well. Eventually it won’t be “this year” any more. Then I will run out.)
The latest edition: last week, we set a record. The Nasdaq 100 managed to close up on the week despite the Philadelphia Semiconductor Index falling 4%. That marks the third time in 2026 that the tech-heavy gauge has managed to post a weekly gain despite this critical group getting clobbered, surpassing the previous record set in the year 2000.
For reference, this has happened just 13 times going back to May 1994. The number of occasions since the end of June is the same as the amount from August 2008 through Q2 2026!
Of course, this phenomenon can only happen if software stocks are coming to the rescue, which iShares Expanded Tech Software ETF did with a 3.9% weekly advance.
Jonathan Krinsky, chief market technician at BTIG, remarks that software “has quietly become the new mo’,” with the software ETF having a “compelling set-up” after trading sideways for almost two years.
(As a fun aside, Krinsky also thinks cybersecurity stocks “could use some consolidation” here. Looking for a software breakout with its hottest component taking a breather would be a bit of an “Ireland wins, but Viktor Krum gets the Snitch” situation.)
Software stocks now have the highest contribution to risk in Goldman Sachs’ US 3M Momentum Long Index. And the last time a semiconductor company — Astera Labs — was in this basket was September 9.
(Note: contribution to risk is distinct from weighting/exposure — market beta and factor explain the bulk of the movements in this index.)
The interplay between the two will be a critical dynamic to watch this earnings season. So far in 2026 we’ve seen software stocks punished simply for existing during a reporting period, then saw similar rates of growth heavily rewarded by the market. Aggregate earnings beats were roughly 10% across tech industry groups last earnings season, but software stocks had by far the best one-day price reactions.
Is the standard for software companies still as low as “just prove you’re not being imminently disrupted,” or are traders looking for something more this time around to justify the renewed momentum in their share prices?
Or, conversely, are software stocks fated to be the mirror image of whatever expectations semiconductor stocks have for this reporting period, and whether or not those clear the bar…
The bare miNIMum
The unofficial season is upon us, with a host of banks (headlined by JPMorgan) slated to report results on Tuesday morning.
Per Factset, S&P 500 earnings are slated to grow about 30% year-on-year; baking in the typical beat rate over the past five years, that pace would swell to roughly 36%.
Again, you will probably hear things about the “high bar” for this reporting period, and once again I think this is not true for the typical stock: expectations are high and rising mostly for tech stocks .
“We find it interesting that there has continued to be little movement in bottom-up consensus EPS growth forecasts for 3Q26, 2026, and 2027 since Labor Day, at least outside of Tech, Energy, and the Mag 7,” writes RBC chief US equity strategist Lori Calvasina.
To add on to the discussion above, since the end of August 12-month forward earnings estimates have been revised much more for semiconductor & equipment stocks (+8.7%) than their software counterparts (+1.2%).
We’ve previously remarked upon Goldman Sachs’ research observing that the near-term sales outlook wasn’t playing much of a role in driving valuations, especially compared to the anticipated three-year trajectory.
And over the short-term horizon, it seems like there really is only a loose relationship between S&P 500 companies’ sales revisions and returns.
All members of the S&P 500 bank industry group are down since July 13, the eve of JPMorgan’s previous quarterly report, despite nearly all enjoying positive sales and earnings revisions over this stretch.
What gives? Well, the “Leopold low” for the S&P 500 in late July also coincided with impressive quarterly results from Microsoft, a one-two punch that helped spark a rotation toward megacap tech and away from pretty much everything else.
Banks have further suffered after being tagged as “consumer inertia” stocks that could be forced to pay up more for deposits to prevent agents from moving funds to higher-yielding pastures.
Robinhood traders have been backing up the truck to buy banks during this downdraft. One-month cumulative net purchases of JPMorgan, Citi, Wells Fargo, Bank of America, Goldman Sachs, and Morgan Stanley are near all-time highs, with flows trailing only the rebound from the pandemic and amid the collapse of SVB.
An agentic-driven hit to net interest margins may certainly be something to worry about in the medium term, but in the near term there is another reason for banks to begin to pay up more for deposits: the Fed’s hiking again!
“The ‘peak NIM’ narrative is widespread and continues to impact sentiment toward traditional spread lenders,” writes KBW analyst Christopher McGratty. “The outlook for NIM will understandably be of particular interest, as 3Q26 is set to be the first quarter in two years in which IBD [interest-bearing deposit] costs are likely to increase (KBWe +9bps), and this follows a heightened sensitivity on 2Q26 conference calls related to changes in deposit costs.”
JPMorgan, for its part, changes one letter from NIM to help make a bullish case for banks:
“Our analysts argue the fundamentals into 3Q are likely better than price action suggests: higher rates should support NII, and the increase in volatility in the back half of September could lift trading revenues versus guidance,” writes equity derivatives strategist Bram Kaplan. “They also see the market’s AI-related concerns around deposits and deposit pricing as overdone: widespread adoption that includes granting banking access appears unlikely near term, and fraud/logistical issues remain.”
In particular, he flagged Citi as having the most leverage to higher interest rates.
Kaplan & Co. recommend buying the October Financial Select Sector SPDR Fund $55.50/$56.60 and Citi $134/$139 call spreads ahead of quarterly results.
Seen on Socials
Via Chris Whittall on Bluesky:
What to watch
Tuesday:
Earnings from JPMorgan, Goldman Sachs, Citi, and Wells Fargo slated for release ahead of the open.
Wednesday:
ASML releases earnings overnight.
Bank of America, Morgan Stanley, BlackRock, Fastenal, and Progressive Corp. release earnings premarket.
September CPI inflation report scheduled for 8:30 a.m. ET.
Anthropic scheduled to host an analyst day.
Thursday:
TSMC slated to report results overnight.
Earnings from BNY Mellon, Charles Schwab, and Interactive Brokers slated for release ahead of the open.
September retail sales and PPI inflation scheduled for 8:30 a.m. ET.
American Airlines and JB Hunt results due out postmarket.
