The Rally's Road Ahead: How to Position Near Record Highs 6/16/26

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**Scott Wapner** (0:57)
I'm Scott Wapner and you're listening to CNBC's Halftime Report, the podcast, the most profitable hour of the trading day. We record this live weekdays at 12 Eastern. Listen in.

**Frank Holland** (1:12)
Thank you, Carl and Sarah. Welcome to the Halftime Report. I am Frank Holland. In for the judge, Scott Wapner. Front and center at this hour, the rallies rode ahead as the market tries to maintain Monday's momentum. The Investment Committee right here with their positioning playbooks with stocks very close to record highs. Joining me for this hour, we have Joe Terranova, Shannon Sokosha, Jenny Harrington and Josh Brown. Before we get started, quick check on the markets right now. You can see right now, the Dow, it's up over three quarters of one percent. On pace for a four day win streak. The S&P on pace to snap a three day win streak. Down into the Russell, you see pulling back about a quarter of one percent. I think that's really where we got to start. Joe, you're right here with me. I'm going to start with you. So we're looking at the markets right now. We know that the S&P equal weight is actually coming off a record high. At the same time, we see a stock like SpaceX surging last check up over eight percent. So do you want to play the broadening or do you want to play tech and this new enthusiasm around the tech sector?

**Joe Terranova** (2:04)
I think you want to play momentum because you could find momentum in both of those types of strategies. First of all, let's keep in mind SpaceX options introduced today, that's going to add to the volatility that's currently in place. But you're correct to identify the S&P equal weight. I believe we have a new all-time high once again for the S&P equal weight. So momentum can find itself in different places. It could find itself in the AI trade and semiconductors and guess what? It could find itself in Caterpillar. It could find itself in Edward Life Sciences. How about Monster Beverage or Williams Sonoma? These are four names that we hold in the JTETF. They have nothing to do with technology. They have nothing to do with the AI story, but each of those four names are making a 52 ECHI. And I think that's the condition. I think that's the story in the marketplace today.
I think that capital is moving away from energy.
Capital is moving away from some of the defensive positioning because yields 4.5%, six consecutive days at the beginning of June. That warranted some defensive positioning. Capital is now relaxing and it's moving to a variety of different places, all with momentum as the common denominator.

**Frank Holland** (3:23)
All right. So obviously today we are seeing a bit of a pullback on the S&P and the NASDAQ. But Shannon, I want to come over to you. You say right now the markets have been propped up, obviously aside from today, by a three-legged stool. One of those stools, or one leg on that stool, I should say is SpaceX and the enthusiasm around it. Joe just mentioned the options start trading today. Also, we've seen SpaceX surpass Amazon and MarketCap. What are the broader implications for the broader rally in the market?

**Shannon Sokosha** (3:46)
Well, I think that there had been a little bit of potential concern around the digestion of SpaceX, not only due to the size, but the fact that investors are going to need to fund their positions in SpaceX from somewhere. And so, where was that going to come from? And how is the overall market going to adjust its thinking in terms of perhaps what's coming next? And so, I think it's not just about SpaceX, Frank. It's number one, we're seeing a little bit of a pullback in technology. I would imagine that some of that is coming from the funding of SpaceX positions. You're not going to trim your healthcare positions, for instance, likely to fund your position in SpaceX. But number two, I think that there's an undercurrent where we're anticipating several other large IPOs this year. And then into 2027, it really clears the deck, if you will, for a spate of IPO and M&A activity that private market investors have been waiting on for some time. And so the fact that the markets have digested this very large IPO, the fact that we are seeing some trading around that in other sectors and the potential for a broadening out, I think that that's a healthy reflection of the fact that perhaps we're moving back towards what we saw in the first couple of months of the year. The common denominator, I know that Joe said it's momentum. I actually think it's the rate environment. I think the more that we see the pedal ease off of rates, we saw that with a softer CPI last week. I think that's really what you're seeing. So digestion, lower rate, lower pressure on yields, and most importantly, what's happening in the Middle East.