Markets have soared toward the rare air last breathed by investors in the mid-1980s, but the stalling tech rally is bringing stocks back down to Earth. 

A tenth consecutive winning week looked locked in prior to a series of quarterly updates on Wednesday that punctured a hole in the AI trade that has powered markets higher since the end of March.

Stubbornly high Treasury yields, the lack of an agreement on ending the U.S. war with Iran, and a near 10% gain for global crude prices since last Friday’s close added to the market’s angst.

A series of key market metrics, meanwhile, are starting to suggest the springtime rally, which lifted the Nasdaq north of 27,000 points earlier this week, is showing signs of fatigue.

The timing isn’t great.

SpaceX will debut its $1.8 trillion IPO next week, with a fixed price set just hours before the S&P 500 said it wouldn’t bend the rules to allow fast-track inclusion, or invite an unprofitable company into the benchmark. 

Tesla, you will recall, took a full decade to meet S&P/Dow Jones index rules and gain entry into the S&P 500. SpaceX, which lost around $5 billion last year, may take just as long.

Beyond SpaceX’s listing, markets will navigate Friday’s employment report, sustained Middle East volatility, and the first Federal Reserve policy meeting under new Chairman Kevin Warsh next week. 

Apple’s annual Worldwide Developers Conference, expected to unveil new and key developments in the AI space for the world’s third-largest company, is slated to begin on Monday.

In other words, the long tech rally has a lot of work ahead.

—Martin Baccardax

Get more of the journalism you love. Choose Barron’s as a preferred source in Google.

A mundane piece of electrical equipment could make data centers more efficient, and it’s got investors in a frenzy. Solid-state transformers convert power to different voltages, and go largely unnoticed, attached to telephone poles everywhere. But in the stock market, they are turning heads.

• It has breathed fresh life into beaten down shares of solar equipment makers Enphase Energy and SolarEdge. While they make inverters to turn solar energy into useful voltage for homes, transformers are a new market for them, says Jeff Osborne, an analyst covering the energy transition at TD Cowen.

• It will be a major undertaking because the old transformer system has been around almost as long as electricity itself, and is deeply entrenched. Solid-state transformers are much lighter than the current version and can manipulate voltage in more sophisticated ways—almost like switching an analog system to digital.

Nvidia kicked off the race to develop solid-state transformers last year when it published a white paper outlining its blueprint for next-generation data centers. The problem with using standard electrical equipment for new data centers is that it’s inefficient, and is starting to take up too much space.

• Companies have been experimenting with solid-state transformer technology for a few years, but they had minimal economic incentives to plow money into development. For instance, SolarEdge started developing a transformer product around six years ago, but put the effort on hold in 2024 because it got too expensive.

What’s Next: GE Vernova says it’s on track to deliver its first transformer this fall to a hyperscaler, which will test it to see if it’s up to snuff. If all goes well, orders are likely to commence next year. Schneider Electric and ABB, two other big industrial players, are developing solid-state transformer products, too.

—Avi Salzman

Quantinuum’s highly anticipated trading debut got off to a good start on Thursday, in what seemed to be a major win for the quantum computing industry. Then the momentum faded.

• The stock popped in early trading, opening at $68—13% above its initial public offering price. But the gains fizzled out, with shares closing at $60.38 for a gain of just 0.6%. Still, Quantinuum outperformed peers including IonQ, D-Wave Quantum, and Rigetti Computing on Thursday.

• It’s a familiar story for most quantum investors. The stocks remain highly volatile, driven by sentiment and hype. While industry players contend that the technology is no longer speculative, the broader market hasn’t bought into that view yet.

• Quantum computing is still a waiting game. The real shift won’t happen until the end of the decade, when players including Quantinuum expect to deliver scalable, commercially viable systems.

• Quantinuum is backed by Honeywell, which will retain a major stake in the company as well as voting rights following the IPO.

What’s Next: It remains to be seen whether the IPO will set the tone for Quantinuum’s first full trading session on Friday. For now, management remains upbeat. “I put the company in the context of an entire industry,” CEO Rajeeb Hazra told Barron’s. “This is a very transformative period, where there’s an insatiable need for more compute to do things that AI or high-performance computing can do.”

—Mackenzie Tatananni and George Glover

President Donald Trump is shoveling $700 million into the coal sector using a Korea War-era law that gives the federal government control over areas of the economy tied to national security. It’s lifting stocks in the sector, including Peabody Energy, up 33% since May 20.

• Trump announced $500 million in Defense Production Act money to 13 coal-fired power plants and an export terminal in California. The president also announced nearly $200 million in grants to build coal plants in Alaska and West Virginia, and funding to restart a coal plant in Maryland.

• Those would be the first new U.S. coal plants since 2013, according to the White House. The president calls it a way to compete with China, claiming that China built more than 50 coal plants last year and only built wind turbines to sell the U.S. and Europe.

• This is the latest move by Trump to bolster the U.S. coal industry, after ordering military bases to contract with coal plants for power. In the Oval Office Thursday, Trump said it would allow these facilities to invest in upgrades that will extend their operational lives for decades.

• Newcastle coal futures have risen around 37% this year and have gained about 40% over the past 12 months, according to Dow Jones Market Data. The Range Global Coal Index ETF was up more than 2% on Thursday.

What’s Next: Supporters of coal’s revival say it’s about meeting demand for electricity and energy security through domestic resources. The Energy Information Administration forecasts coal to generate 16% of electricity in the U.S. this year and 15% in 2027, down from 17% in 2025.

—Kit Norton

In case you haven’t heard, SpaceX is about to go public. Fidelity is trying to make this year’s hottest IPO more accessible to more people by lowering the minimum brokerage account size to qualify for ordering the shares to $2,000 to compete better with the no minimums required by rivals. 

• Making an order at the expected $135 IPO price doesn’t guarantee getting them, but Fidelity normally requires a minimum of at least $100,000 to make an indication of interest. SpaceX wants to appeal to more retail buyers by offering 30% of its shares to average investors versus the more typical 5% to 10%.

Robinhood, SoFi, and Morgan Stanley-owned ETrade don’t have minimums. Charles Schwab, the other retail broker offering the SpaceX IPO, still has a $100,000 baseline. David Kudla, CEO of Mainstay Capital Management and a Barron’s-ranked advisor, says Fidelity’s move might be more about public relations than anything else.

• Kudla added that it’s understandable why brokerages with an allocation to the SpaceX IPO will try to push it hard to individual investors. Among larger institutional investors, there is some growing skepticism about its valuation. Fidelity declined to comment.  

• Investors looking for SpaceX exposure might be better off buying exchange traded funds or other funds that already own SpaceX through private rounds, Kudla said. Some of these funds have risen sharply, including the Destiny Tech100 closed-end fund.

What’s Next: Each broker has their own criteria to determine which bids will receive an allocation. Robinhood’s selection will be random, and SoFi said it would be unlikely to give shares to investors who had previously flipped an IPO, or sold the stock within 30 days for a quick gain.

—Paul R. La Monica and Janet H. Cho