In this blog post, we will delve into the latest insights from the GS TMT desk, covering topics such as tech rotation, FOMC meeting, and market trends. The team at GS has provided valuable analysis on the current state of the tech sector, highlighting areas of strength and weakness.

Firstly, the team notes that there has been a rotation within the tech sector, with names like AMAT, LRCX, MU, and WDC leading the charge higher. This is despite a quieter overnight newsflow, with volatility in oil and rates remaining stable-ish. The focus remains on semis and AI after yesterday’s pullback, with Vincent Lin providing a comprehensive rundown of market conditions.

In addition, the team highlights that across the broader tape, 65%+ of names in the S&P500 are higher amidst renewed cyclical optimism. This is despite the SPX being down 90 bps in June, with Info Tech and Comm Srvcs weighing it down. The team notes that Fins are up 5% in June, while Industrials have seen break-outs in GE and CAT.

The team also provides insights on the top inbounds yesterday, including strength in RBLX and TTWO, while NFLX and SPOT saw weakness. The team notes that there is weakness (and dispersion) in semis, with HDDs leading the way. Views into ACN? MU? QCOM a-day? are also discussed.

Furthermore, the team highlights that CRM is down 11 days in a row, the longest streak ever, and notes that there have been few questions on this slide over the last ~3 weeks. Other notable names include FIG down 11 days in a row, HUBS + MNDY both down 10 of 11, and WDAY down 9 of 11.

Finally, the team discusses the upcoming FOMC meeting, with GIR providing a preview of the event. The conversation revolves around the observability landscape becoming more open, more experimental, and potentially more fluid than it has been in some time. This has led to ongoing industry debates regarding whether OpenTelemetry meaningfully changes the default architecture of newer workloads, and how quickly AI SRE evolves from an emerging workflow into a more consequential one.