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Mega-Cap Muscle, AI Mania and a June Jobs Gauntlet: The Bulls Still Own the Pit
Danny Riley
June 01, 2026
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JPMorgan Chase CEO Jamie Dimon said at a conference Friday, “I view the market as exuberant, and I’ve seen this before,” but “Of course, exuberance can go on for a long time.”
My own opinion is that I don't think that many investors 1) saw this coming and 2) thought that the markets would go up so much, so fast. And with the top 25 stocks making up over 52% of the S&P's total value, it's not wrong to cast doubt on the longevity of the rally.
The top block of 10 mega-cap companies accounts for roughly 39% of the entire index's weighting, and if you narrow it down to the Magnificent 7 alone, they contributed to nearly 50% of the market's gains in the first quarter.
AI data historical tracking shows that over 40 AI-linked companies have generated or are responsible for 65% to 70% of all the S&P 500's gains, corporate profits, and capital spending.
When looking strictly at individual listings, the semiconductor and hardware giants take up the absolute maximum real estate on the tape:
I think this is astounding…
$NQ, RTY, ES, & YM Comparison Chart
The ES traded in a narrow 7572.75 to 7590.75 Globex trading range with 171k contracts traded and opened Friday's 9:30 ET regular session at 7590.75, up 8.75 points or +0.12% on the day.
After the open, the ES traded 7590.75, rallied 2.00 points up to a 7592.75 “double top” at 10:02, sold off 15.25 points down to 7577.50 at 10:43, and then ripped up to 7598.25, pulled back to 7598.50, and then this hit:
Trump lifts the U.S. naval blockade in the Strait of Hormuz, says that Iran needs to open the Strait and allow for Iran's stockpile of enriched uranium to be "unearthed" by the U.S., adding that he's meeting in the Situation Room "to make a final determination."
The ES traded up to 7604.75, pulled back under the VWAP down to 7593.25, and rallied 15.25 points up to a new all-time contract high at 7608.50 at 12:40. From there, the ES sold off down to 7581.75 at 2:00, rallied 16.75 points up to 7598.50 at 2:30, and sold back off down to 7583.75 at 3:00. The ES then rallied 23.25 points up to 7607.00 at 3:42, sold off down to 7600.25 at 3:48, traded 7602.75 as the 3:50 imbalance showed $1.8 billion to sell and traded 7595.00 on the 4:00 cash close.
After 4:00, the ES sold off down to 7589.25 and settled at 7595.50, up 14 points or +0.18%, the NQ settled at 30,405.25, up 98.25 points or +0.32%, the YM settled at 51,077.00, up 334 points or +0.66%, and the RTY settled at 2,924.30, down 17.50 points or -0.59% on the day.
In the end, the ES traded in a narrow trading range in both the Globex and day sessions. In terms of the ES's overall tone, it was firm but was rejected and could not hold above 7600.00. In terms of the ES's overall trade, volume was higher, with 180k contracts trading on Globex and 1.280 million on the day session for a total of 1.46 million total contracts traded.
I think what I wrote in Friday's Lean was right on: buy the pullbacks, but maybe some late-day, month-end rebalance selling. Like I said, "sell in May and walk away" didn't work as the U.S. indices wrapped up another solid month of gains.
The NQ recorded its largest two-month gain since November 2022, climbing nearly 25%. The ES also recorded its largest two-month percentage gain since May of 2020 and finished the week with gains for the ninth straight time. The YM rose to a new all-time high and crossed over the 51,000 level for the first time ever.
It's very clear that the positive earnings keep fueling higher stock returns; according to FactSet, in the first quarter of the year, the year-over-year earnings growth rate for companies in the S&P 500 is 28.6% based on actual results and analyst estimates, and if it keeps going, the index will lock in its highest earnings growth rate since the fourth quarter of 2021.
That said, it was a quiet session, but a few other things did stick out: Brent crude oil fell 19% in May, its largest monthly drop since 2020. In Chicago, gas dropped from $5.04 to $4.09 in 4 days, but a deal with Iran seems to be falling apart again.
January 2026 to May 2026 ES vs NQ Chart
Goldman Sachs
The US stock market's 2026 rally has been driven entirely by rising corporate profits rather than increasing equity valuations—and Goldman Sachs Research expects that trend to continue.
The S&P 500 is forecast to rise to 8000 by the end of this year, up from an earlier projection of 7600, according to Ben Snider, chief US equity strategist in Goldman Sachs Research. The rally would mark a 6% gain from current levels (as of May 26). The higher forecast is driven by upgraded earnings estimates; the team projects S&P 500 earnings per share (EPS) of $340 in 2026, a 24% increase from the prior year, and $385 in 2027, representing 13% growth.
Spending on AI infrastructure is the single biggest driver. The largest tech firms are projected to spend $754 billion on capital investment this year (an 83% jump from 2025) and $905 billion in 2027. The companies that benefit from AI infrastructure investment are expected to account for roughly half of S&P 500 EPS growth this year.
The MOC opened with a clean buy imbalance at 15:50, showing $971M sell imbalance, with $23.7B to buy against $24.6B to sell. The transition was important because the market never regained a true wholesale buy tone. Even when the dollar side briefly moved positive between 15:53 and 15:57, the lean stayed rotational, hovering near the 50% zone rather than showing broad conviction.
By 15:59, the MOC settled into a larger sell-side finish, with total imbalance at -$2.152B, buy demand of $14.2B, and sell pressure of $16.352B. The final dollar lean was -53.5%, while the symbol lean was -55.9% across 1,318 symbols. That is not an extreme wholesale sell reading, but it does show a persistent sell bias into the close.
The index breakdown was mixed. NYSE showed a positive $700.62M net imbalance, with a +51.8% dollar lean, but its symbol lean was still negative at -53.6%, suggesting the buying was concentrated. S&P 500 was weaker, closing with a -$1.25B imbalance and roughly balanced symbol count. NASDAQ was the clearest pressure point, showing -$1.672B total, with dollar lean at -52.9%, even though symbol lean was positive at +60.8%.
Sector action showed major crosscurrents. Utilities had a strong wholesale buy dollar lean at +74.2%, while Basic Materials was +100%, but based on only one symbol. Materials and Consumer Discretionary were also notable buy-leaning groups at +69.3% and +67.7%. Communication Services stood out on the sell side with a -66.5% dollar lean, close to wholesale selling. Financials, Real Estate, Industrials, and Information Technology were also net sellers.
On the symbol level, buying was led by MSFT, AVGO, AMD, AAPL, META, MU, FTI, LIN, and AMZN. Selling pressure was led by NVDA, GOOG, INTC, PLTR, UBER, GOOGL, QCOM, GE, MA, CRM, and SLB. Overall, this was a rotational-to-sell MOC, not a panic close, but the late transition favored sellers.
Technical Edge
Fair Values for June 1, 2026
SP: 14.27
NQ: 67.07
Dow: 45.99
Daily Breadth Data 📊
For Friday, May 29, 2026
• NYSE Breadth: 48% Upside Volume
• Nasdaq Breadth: 59% Upside Volume
• Total Breadth: 55% Upside Volume
• NYSE Advance/Decline: 41% Advance
• Nasdaq Advance/Decline: 49% Advance
• Total Advance/Decline: 46% Advance
• NYSE New Highs/New Lows: 115 / 42
• Nasdaq New Highs/New Lows: 409 / 89
• NYSE TRIN: 0.76
• Nasdaq TRIN: 0.68
Weekly Breadth Data 📈
For Week Ending May 29, 2026
• NYSE Breadth: 56% Upside Volume
• Nasdaq Breadth: 65% Upside Volume
• Total Breadth: 62% Upside Volume
• NYSE Advance/Decline: 58% Advance
• Nasdaq Advance/Decline: 64% Advance
• Total Advance/Decline: 62% Advance
• NYSE New Highs/New Lows: 267 / 104
• Nasdaq New Highs/New Lows: 858 / 256
• NYSE TRIN: 1.09
• Nasdaq TRIN: 0.97
BTS Levels - (Premium Only)
Today’s Important Economic Events
Polaris Trading Group Summary - Friday, May 29, 2026
Friday’s PTG session was a constructive end-of-month trading day focused on patience, confirmation, and respecting tested levels. The room’s main opportunity came from the D-Level short near 7602.50, which later fulfilled its target and gave members a strong example of waiting for structure to shift before acting.
Opening Context
David opened the room with the standard PTG links, daily strategy resources, range calculator, and risk disclaimer.
The day was framed around end-of-month “window dressing” Friday.
The early discussion focused on prep, market structure, and how to interpret the profile and key levels.
Early Education and Clarifications
David clarified that the main profile shown was a 5-day composite profile.
Members asked about CD1/BDL, ATR, VAH, and how PTG levels were calculated.
David explained that he does not use MIM in the decision process because it has not been back-tested by him.
This reinforced a key PTG principle: use tested tools and avoid adding unproven inputs to trade decisions.
Main Trade Setup
David identified D-Level 7602.50 as a possible sell area.
The market was initially strong, and members recognized that forcing shorts too early was risky.
The important lesson was to wait for confirmation rather than shorting simply because price reached a level.
D-Level Short Result
The setup developed into a clean short opportunity.
David later confirmed: “D Level short target PH fulfilled.”
After the target was fulfilled, David noted that the sell-side lean was now in play.
He later added that the short lean was active below the 7600 handle.
Positive Trades
Bruce reported a successful DLMB trade and commented that “DLMB strikes again.”
Dan also worked the short and said the DLMB did its job.
Dan noted that he trailed the final scale a little too tightly, but still accepted the trade as a good Friday result.
These were strong examples of using PTG levels, managing the trade, and avoiding overtrading late in the week.
Market Read and Trade Management Lessons
The room discussed the transition from early strength into a sell-side shift.
VWAP, A4/A10, and the “knuckle sandwich” area helped frame the change in market tone.
The session highlighted the importance of patience, confirmation, and recognizing when the market has moved from strength into weakness.
Traders were reminded not to fight a strong market too early, but also to be ready when the structure shifts.
News and Risk Awareness
Midday headlines around Trump, Iran, and the Strait of Hormuz added macro noise.
Members noted that Friday news can create weekend risk.
The discussion reinforced the benefit of being flat overnight, especially heading into the weekend.
End-of-Day Takeaways
The featured winner was the D-Level short from the 7602.50 area.
The DLMB tool performed well and helped multiple members identify or manage the short-side opportunity.
The best lesson of the day was to wait for confirmation before acting on a level.
Overall, it was a constructive Friday session with a clean trade, useful education, and a strong reminder to follow the tested PTG process.
DTG Room Preview – Monday, June 1, 2026
Pre-Market Tone
US equity futures are mixed but steady.
ES, Dow, and Nasdaq futures are slightly positive.
Russell futures are lagging.
VIX near 15.8 suggests a relatively calm volatility backdrop.
Gold and Bitcoin are modestly firmer, while crude remains weaker on easing Middle East tension expectations.
Macro Focus
US–Iran headlines remain the main macro swing factor.
Markets are watching for a possible 60-day truce renewal pending presidential signoff.
Oil’s sharp May decline shows traders are leaning toward de-escalation rather than escalation.
The Fed’s preferred inflation gauge came in hotter, supporting the view that rates may stay steady rather than move quickly toward cuts.
Global Data
Germany state-level inflation slowed, pointing to possible national deceleration.
Italy’s jobless rate edged lower to 5.1%.
India warned of the weakest monsoon rains in 11 years, raising inflation concerns.
Taiwan raised its 2026 GDP outlook to a 16-year high on AI-driven demand.
Equity Themes
AI remains the dominant market theme.
Dell surged after an AI-driven earnings beat.
Snowflake also jumped on strong AI-powered results.
Salesforce beat estimates but issued cautious revenue guidance.
Samsung and SK Hynix rallied sharply, though exposure limits triggered some forced selling.
Active names include NVDA, NOK, F, and PLUG.
ES Technicals
ES continues to test the former short-term uptrend channel top at 7576/81.
Holding this area as support keeps the upside path open.
Failure to reclaim or hold it as support could shift focus toward nearby trendline support at 7503/08.
The 50-day MA remains above the 200-day MA, keeping the longer-term moving-average structure bullish.
Key ES Levels
Resistance: 7576/81, 7895/00
Support: 7490/95, 7435/40, 7370/85
Today’s Calendar
8:30am ET: Goods Trade Balance, Wholesale Inventories
9:45am ET: Chicago PMI
Fed Speakers: Schmid, Bowman, Paulson, Daly throughout the morning and early afternoon.
