EB Daily Market Report - Brief Update - Wednesday, June 25, 2025

As we approach the end of Q2 and the halfway point of 2025, our major indices are trying their collective best to resume the secular bull market that we've enjoyed since April 2013, when the S&P 500 finally cleared its 2000 and 2007 highs. The good news is that many of our sustainability ratios are pointing to strength or improving strength in growth areas of the market. We don't typically see this type of set up just before a major market decline. Rather, this type of aggressive, "risk on" type of market behavior usually precedes the next leg higher in the bull market.

We're going higher. That's my call, no waffling. It's what I said at MarketVision 2025, even though I did say I thought we could see a correction prior to reaching those highs later in the year. My call of S&P 500 at 7000 stands for the end of the year.

Does any of this mean we're going higher RIGHT NOW? Today? Tomorrow? Next week? Of course not. Trying to call every single short-term move higher or lower in stocks is the equivalent of psychological suicide. It's impossible. Instead, what we need to do is to be able to understand when a pullback or selloff is "okay". I know everyone would like to see their portfolios rise every day, but that's not practical and, quite honestly, that's setting the bar way, way too high.

Currently, the S&P 500 ($SPX) is flirting with its all-time high. The NASDAQ 100 ($NDX) is already there, thanks to a surging technology (XLK) sector. The small cap IWM and mid cap MDY are both lagging, along with transports ($TRAN). ALL of our major indices remain, however, in long-term secular bull market uptrends. You think transports are in trouble? Take a look at this longer-term weekly chart and tell me how much trouble they're in?

We get so caught up in the "what have you done for me lately" mentality, that many of us aren't able to step back and look at the big picture. Yes, there's no doubt that transports have lagged for the past few years, but this long-term chart shows that we could see transports catch fire at any point. My guess is that transports show tremendous leadership later this year with interest rates falling as market participants anticipate a strengthening economy in 2026.

We need to make sure we keep everything in perspective. By doing so, many times the market's next move simply falls right into our lap.

Happy trading!

Tom