pre mkt thoughts 24 Jun 26

US yields were firm and unchanged for the day. In Asia trading, $KOSPI staged a nice rollercoaster to rebound up 3.5% at this time of writing while $NKY is almost unchanged for the day. When we talk about KOSPI and NKY...we inevitably veer into the memory sector. To really get a comprehensive look at this, we need to of course talk about $SNDK and $MU in NY trading yesterday. Both tickers were down ~13% before we get $MU earnings tonight. $SK HYNIX has staged a very strong rebound into todays session despite multiple curve balls thrown at it. This illustrates to me that the technical selling pressure may be abated very soon.
Before this bout of weakness, i was waiting for $MU earnings to come before getting long - given that $MU has always fared poorly post earnings. However, baring a big miss from $MU, i would lean on the balance of probability that $MU and the memory complex in general would stage a strong rebound through July. $RAM - the 2x levered long ETF for $DRAM is also launching tonight. I believe this would get extremely strong traction as well and in the short term be fuel for the memory rally.
Memory pooling names like $ALAB, $CRDO, $PENG have also been very firm through the drop yesterday. $ALAB sits comfortably at 400, 60% higher from the previous low.
The star of the show has to go however to the neoclouds, especially $NBIS. First off, the index inclusion for $NBIS has happened, typically names rally into inclusion and ease off thereafter. $NBIS looked like it was going to roll over into the open before staging a 15% rebound that brough it almost to the top of the range - this on a day where $SMH was down 6% is impressive strength. On the fundamental side, the case for compute has been talked about multiple times - i will briefly go over it here again (look at previous notes) - In a world for a sovereign buildout thesis, there will be a duplication for build out capacity, this expands the TAM expectations. Next, with competition from the Chinese Labs, OAI and Anthropic have to compete fiercer....compute and design are the parameters to push on.
On the neoclouds, i also believe that $SHAZ will be filed in the 13G as Situational Awareness exceeds a 5% stake. This is notable to me because, $SHAZ is a tiny cap stock without much of a buildout. However, why did Situational Awareness lead the equity deal for them? Is there something that Leopold sees in this? Regardless of the case, this funding (equity +convertible debt at ~5% interest) basically has raised enough cash for the 102MW of contract that they were guiding for mid 2027....which should bring about ~1-1.3B of ARR which on comparables would lead to a range between 6B ($CRWV) - 10B ($NBIS) - the stock is ~3B now (after factoring in the dilution)
This is highly speculative and i could be completely wrong about it.
$MU earnings expectations
EPS ~19.8
Rev ~34.5B
Expectations are high, especially on a raise for forward revenue guidance.
To conclude, i think baring a miss in $MU earnings, much of the technical selling in semis is over. I would be calling for neoclouds and the memory pooling sectors to lead in the rally with memory following closely behind.
Good luck!