Michael Burry, the investor best known for The Big Short, said he continues to believe the market could be nearing a major top and potentially face a 1987-style crash despite the S&P 500 climbing to fresh record highs.
Burry said on Tuesday he is maintaining his bearish positions, adding that underlying momentum and volatility trends still point to the possibility of a sharp market reversal.
In a Substack post, Burry said the S&P 500 made new highs on Tuesday, while the equal-weight S&P 500 had already reached record levels. “The NASDAQ 100 is still some ways off its all-time high,” he said.
Citing data from BTIG’s Jonathan Krinsky, Burry said the “S&P 500 has surged 5% over four trading days to a new high only three times other than today.” Those instances came on March 21, 2000, near the peak of the tech, media and telecom bubble, April 23, 1999, around the time many dot-com stocks began to decline, and November 9, 2020.
Burry said, “What really matters is the SOX, and the Momentum trade,” adding that those trades were hit hard in July. He said the key question is whether they can regain market leadership, while pointing to the six-month, 30-minute chart of the SOXX ETF as showing momentum turning back to the upside.
Despite the market’s rally to new highs, Burry said he is keeping his bearish bets in place. “I continue to believe it is possible we are near a major top, and possible a 1987-type fall, but the S&P 500 making new highs likely will bring new money into the market. I continue to maintain my SOXX put position and short position in the equity.”
Burry said rising markets combined with falling volatility force volatility-targeting funds “to leverage up, and brings leverage from other momentum strategies into play.”
He added that the Goldman Sachs Momentum Pair Trade remains damaged after its historic run, while the VIX/VIXEQ remains at 12-year lows. According to Burry, many pod shops and volatility-targeting funds that were hurt during July are still “licking wounds,” even as subdued index volatility continues to mask substantial volatility beneath the surface.
Separately, Burry said he is working on the fourth installment of his “Heretic's Guide,” which will examine the earnings and regulatory filings of the five largest hyperscalers through a forensic analysis. He said the analysis is largely complete, with work continuing on the visuals and final prose.
On Tuesday, the S&P 500 ended 1.8% higher, while the Nasdaq 100 closed the session up 3.3% and the Dow Jones Industrial Average gained 1.7%. Among ETFs tracking the benchmark indexes, the SPDR S&P 500 ETF (SPY) rose 1.8%, the Invesco QQQ Trust (QQQ) finished 3.4% higher, and the SPDR Dow Jones Industrial Average ETF Trust (DIA) added about 1.7%.
Retail sentiment on Stocktwits remained ‘bearish’ with ‘high’ message volumes for SPY, QQQ, and DIA.
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U.S. stock indices ended higher on Tuesday, with the S&P 500 and Dow hitting record highs as investors cheered strong earnings from Palantir, while an easing geopolitical landscape pulled oil prices lower.
The S&P 500 ended 1.8% higher, while the Nasdaq 100 rose 3.3% and the Dow Jones Industrial Average ended 1.7% higher. The Russell 2000, which tracks stocks with small market capitalizations, jumped 2%.
Dow futures were up 90 points, or 0.2%. S&P 500 futures added 0.1%. Nasdaq-100 futures were down 0.2%.
Among ETFs tracking benchmark indexes, the SPDR S&P 500 ETF (SPY) added 1.9%, and Invesco QQQ Trust (QQQ) ended Tuesday 3.2% higher, while the SPDR Dow Jones Industrial Average ETF Trust (DIA) rose 1.7%.
Meanwhile, the VanEck Semiconductor ETF (SMH) rose 4.9%, amid gains in Nvidia (NVDA), Broadcom (AVGO) and Advanced Micro Devices (AMD). The broader Vanguard Information Technology ETF (VGT) added 4.2%, tracking gains in Apple (AAPL), SpaceX (SPCX) and Tesla (TSLA) stock.
Retail sentiment on Stocktwits for SPY and QQQ was ‘bearish’ and ‘neutral’ for the DIA, with ‘high’ message volumes.
U.S. and Iranian officials were sounding hopeful for an agreement to stop the war and open the Strait of Hormuz, as per Qatar, supporting positive investor sentiment. President Donald Trump discussed efforts to de-escalate U.S.-Iran tensions with Qatari Emir Tamim bin Hamad Al Thani, according to the Gulf state’s government. Furthermore, Iran is considering allowing European nations to remove mines from Hormuz, said diplomats familiar with the matter.
“Markets are reacting to the possibility that a reopening of the Strait of Hormuz could help normalize global oil supplies and reduce near-term energy price pressures,” Tony Miano at Wells Fargo Investment Institute told Bloomberg. “Lower oil prices can ease inflation concerns.”
The developments pushed oil prices lower, with the West Texas Intermediate futures settling down 5.69% to $75.77 per barrel. Brent crude, the international benchmark, declined 5.26% to $79.36 a barrel.
Over to earnings, Palantir’s robust revenue outlook, which surpassed estimates by a wide margin, pushed its stock price up close to 30% on Tuesday. CEO Alex Karp noted that AI demand was ‘otherworldly,’ which in turn pushed chip stocks like Micron Tech (MU) and Marvell Technology (MRVL) soaring.
While futures were flattish at the time of writing, investors were digesting after-hours earnings from Advanced Micro Devices (AMD), which somewhat disappointed investors, coupled with quarterly updates from SpaceX (SPCX).
Palantir (PLTR): Palantir Technologies Inc. shares rallied 28% on Tuesday, erasing the entirety of year-to-date paper profits for short sellers, inflicting billions of dollars in mark-to-market losses on investors positioning against the defense software specialist.
AstraZeneca (AZN): AstraZeneca’s merger talks with Bristol-Myers Squibb (BMY) reportedly remain active, though it would require the former to make hard commitments on investments within the U.S., Semafor reported on Tuesday.
Chipotle Mexican Grill (CMG): The company reportedly pulled jalapeños from several of its locations across Minnesota after state health authorities linked the produce to a local salmonella outbreak.
Anthropic: Investment giant Blackstone Inc. (BX) has held early talks with institutional investors to explore interest in a second mega private debt package totaling at least $36 billion to finance AI startup Anthropic PBC’s procurement of Alphabet Inc.’s (GOOG, GOOGL) Google processing chips.
Moderna (MRNA): The company kicked off a Phase 1 clinical trial of its experimental vaccine targeting the Bundibugyo strain of Ebola virus, ahead of a closely watched regulatory decision on its influenza vaccine expected this week.
Shares of Lucid Motors (LCID) plunged about 10% in after-hours trading on Tuesday after the electric-vehicle maker reported second-quarter earnings that disappointed investors, announced a major operational reset focused on cutting cash burn, and hinted at delays to its upcoming midsize vehicle.
The company posted revenue of $405 million, up 56% from a year earlier, on 3,953 vehicle deliveries and 4,774 units produced. The company deliberately slowed production to reduce inventory and preserve cash in the quarter and ended the three months with $3 billion in liquidity. It also said recent financing plus cost actions extend its runway well into 2027, dismissing concerns of an impending bankruptcy.
Q2 adjusted loss, however, came in at $2.78 per share, wider than the year-ago loss of $2.35 and missing consensus estimates near $2.4.
CEO Silvio Napoli, who took the helm of the company in June, said the company is resetting its approach. “Lucid has leading technology, compelling products and deeply committed people, but potential is not performance,” he stated. “We are going back to basics, with a clear focus on cash, customers, and culture.”
The company has identified $1.4 billion in cash-flow improvements for 2026 through lower inventory, reduced spending, and operating-cost cuts. It has already reduced its U.S. workforce, eliminated the second shift at its Arizona plant, simplified its leadership structure, and appointed new executives in key roles. Chairman Turqi Alnowaiser said the board fully supports the changes, which aim to strengthen execution and turn technology leadership into long-term value.
Lucid is concentrating resources on three key programs, namely robotaxis, its upcoming factory in Saudi Arabia, and its next vehicle offering.
Work on its Robotaxi with partners Uber and Nuro remains on track, Lucid said. Testing continues, with commercial production expected to start in the fourth quarter of 2026 and a late-2026 launch.
The new factory in Saudi Arabia, meanwhile, has moved from construction into preparation for production. The company is hiring and targeting a 2027 ramp-up for the plant, which will increase its production capacity. Lucid currently has only an operational plant in Arizona.
Prototypes for its Midsize vehicles are undergoing testing, the EV maker said.
Lucid intends to launch three models based on its midsize platform. Previously, the company said that the first mid-size model, called Cosmos, is expected to be launched later this year and have a price point of about $50,000, helping expand the company’s total addressable market beyond its current premium consumer base.
However, Lucid said in its earnings on Tuesday that it will launch only when quality and processes fully meet its standards. Napoli further told Reuters in an interview that the launch will now likely be in the second half of 2027.
Looking ahead, production in the second half is expected to run below second-quarter levels. Deliveries should exceed production as the company works down inventory, it said.
Lucid had already suspended its prior full-year 2026 production guidance of 25,000–27,000 vehicles in Q1 and did not reinstate the numbers.
Last month, an EV-focused news platform reported that the company is considering either filing for bankruptcy protection or a take-private transaction. Lucid management, however, denied the report.
Lucid remains majority-owned by Saudi Arabia’s Public Investment Fund (PIF), which has invested more than $9 billion and holds a controlling stake of roughly 45–60%. In a further show of Saudi support, Prince Alwaleed bin Talal recently acquired a personal 5% stake in the firm last month, about 19.5 million shares, when Lucid’s market value dipped below $2 billion, helping lift the stock.
On Stocktwits, retail sentiment around LCID stock fell from ‘neutral’ to ‘bearish’ territory over the past 24 hours, while message volume remained at ‘low’ levels.
A Stocktwits user expressed disappointment over the delay of the midsize vehicle launch.
Another opined that the operational reset is a precursor to bankruptcy.
Read More: SPCX Stock Declines As Investors Weigh AI Investment Scale Despite Upbeat Q2 Earnings
Paramount Skydance Corp. (PSKY) reported its financial results for the second quarter ended June 30 on Tuesday, beating analyst expectations on both earnings and revenue while raising its full-year guidance. CEO David Ellison also reiterated confidence that the proposed Warner Bros. Discovery merger will close despite legal challenges.
PSKY shares closed 1.95% higher in Tuesday's regular session ahead of the earnings release but edged 0.12% lower in after-hours trading at the time of writing.
Paramount Skydance reported second-quarter earnings per share of $0.04, compared with $0.08 in the year-ago period. According to Fiscal AI, analysts had expected the company to post a loss of $0.23 per share.
Quarterly revenue came in at $6.91 billion, up from $6.8 billion in the same period last year and ahead of the $6.8 billion consensus estimate, according to Fiscal AI.
The company's direct-to-consumer streaming segment, which includes Paramount+, BET+, and the free ad-supported Pluto TV, generated revenue of $2.47 billion, compared with $2.26 billion a year earlier. Film studios' revenue increased to $1.31 billion from $1.13 billion in the prior-year quarter, while TV media revenue declined to $3.13 billion from $3.45 billion.
Paramount+ recorded its best retention quarter ever, driven by Dutton Ranch, UFC, and the FIFA World Cup, which was available non-exclusively across six countries in Latin America. The streaming platform added around two million subscribers during the quarter.
Paramount Skydance’s proposed $110-billion acquisition of Warner Bros. Discovery Inc. (WBD) remains tied up in antitrust litigation. A California federal judge on Tuesday scheduled a 12-day trial beginning March 2, 2027, to hear lawsuits from a group of states and the Writers Guild of America seeking to block the deal, Bloomberg reported.
Despite that, CEO David Ellison reaffirmed the company’s confidence that the transaction will close. “As we’ve executed against our strategy over the past year, we’ve also prepared to close the transaction, and we remain confident it will be completed, creating a stronger, more competitive, creative-first media company that builds on the foundation we’ve established — one that benefits consumers, theater exhibitors and creatives,” Ellison said in a shareholder letter.
Paramount Skydance raised its full-year 2026 guidance for adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) to a range of $3.8 billion to $3.9 billion from its previous guidance of $3.8 billion. The company expects total 2026 revenue of $30 billion, representing 4% year-over-year growth.
For the third quarter, Paramount expects total revenue to range between $6.95 billion and $7.15 billion and said Paramount+ subscriber additions are expected to be “flattish” quarter over quarter.
The company also expects third-quarter adjusted EBITDA of $875 million to $975 million, implying a 13.1% margin at the midpoint.
On Stocktwits, retail sentiment around PSKY stock remained ‘bearish,’ unchanged over the past 24 hours, while message volume was ‘low.’
PSKY stock has fallen nearly 38% year to date.
Also See: SPY, QQQ, DIA Gain — Iran Weighs Letting Europe Clear Mines In Strait Of Hormuz, Report Says
Advanced Micro Devices Inc. (AMD) stock dropped 7% after hours as a double-digit revenue surge was not enough to keep investors satisfied, while lofty valuations demand a steeper jump in revenue.
AMD reported second-quarter revenue of $11.5 billion, representing a 50% increase compared to the same period last year, and earnings hit $1.66 a share. Both figures surpassed average analyst projections of $11.3 billion in revenue and $1.62 per share in earnings.
The driver of the expansion remained the company's data center segment, where sales more than doubled year-over-year to $6.7 billion. The surge underscores accelerating capital expenditure across hyperscalers building out modern infrastructure to run artificial intelligence workloads. AMD’s personal computer and gaming business units also combined for $3.8 billion in sales, up 6%
The immediate negative stock reaction points to a valuation mismatch rather than operational weaknesses. AMD shares have more than doubled this year, fueled by excitement over its ability to challenge Nvidia Corp.'s dominance in the AI accelerator market.
However, that steep price surge pushed AMD's valuation multiples well above those of industry leader Nvidia. With the stock priced for perfection, Wall Street set an extremely high bar. While AMD met baseline forecasts, its earnings and guidance failed to deliver the massive, unexpected upside required to support its premium relative valuation.
The sell-off underscores growing market sensitivity around AI-driven technology stocks, where companies face intense scrutiny to continually deliver explosive top-line growth to keep pace with stock price appreciation.
For the third quarter, AMD projected revenue of around $13 billion, give or take $300 million.
While the mid-point of that target comfortably cleared Wall Street’s average consensus estimate of $12.5 billion, it fell short of the longer end of estimates, which went as high as $14 billion.
Retail sentiment on Stocktwits was ‘extremely bullish’ with ‘high’ message volumes.
One user highlighted the discrepancy between the valuations of AMD and NVDA.
AMD stock has surged 197% year-to-date. The S&P 500 ETF (SPY) is up 23% over the past 12 months, while the Invesco QQQ Trust (QQQ) is up 29%.
Palantir Technologies Inc. shares rallied 28% on Tuesday, erasing the entirety of year-to-date paper profits for short sellers, inflicting billions of dollars in mark-to-market losses on investors positioning against the defense software specialist.
Short sellers accumulated roughly $3 billion in paper losses in a single session as Palantir's stock jumped 30%, marking its strongest single-day performance in two years, according to financial data from partner S3 Partners.
Prior to Monday's market close, market participants betting against the enterprise data analytics provider were holding paper profits of approximately $2.7 billion for the year, driven by prolonged weakness in the equity, according to the data cited by Bloomberg.
The abrupt reversal in market fortunes follows Palantir’s Monday announcement, in which it raised its full-year guidance for both revenue and operating income. The elevated financial projections provided fresh impetus to buyers, overwhelming bearish sentiment that had mounted over previous months.
Concerns over broader enterprise spending and bloated valuations were countered by comments from Palantir Chief Executive Officer Alex Karp, who highlighted "otherworldly" commercial appetite for the firm's data analytics and artificial intelligence suite.
The remarks helped quiet investor worries regarding potential competitive threats from AI model developers such as Anthropic PBC, which some feared might cannibalize legacy enterprise software architecture.
Despite Tuesday's historic intraday surge, Palantir shares remain down more than 8% year to date, putting the equity on track for its softest annual performance since 2022. A portion of the downward pressure earlier in the year was catalyzed by high-profile short positions, including bets disclosed in November by prominent investor Michael Burry. Burry later noted in a June newsletter that he had covered half of his short position in Palantir.
Wall Street analysts remain visibly divided over the stock’s prospective trajectory, primarily due to its premium valuation. Palantir trades at more than 83 times forward earnings, representing a substantial markup over the broader software and technology sector. In contrast, Microsoft (MSFT), Amazon (AMZN) and Oracle (ORCL), who also compete in the US enterprise space, have significantly lower valuations.
Retail sentiment on Stocktwits around Palantir was in the ‘extremely bullish’ territory, with message volumes at ‘extremely high’ levels.
PLTR stock is down 13% year-to-date. The S&P 500 ETF (SPY) is up 23% over the past 12 months, while the Invesco QQQ Trust (QQQ) is up 29%.