Key insights
- JPMorgan data indicates retail investors trimmed software exposure in the week of May 7-13, favoring Nvidia, Tesla, Google, and ASML. Microsoft, Qualcomm, Palantir, and Netflix saw decreased retail interest. This suggests a potential rotation within the tech sector, but overall retail engagement remains high, mitigating strong bearish signals.
While record-breaking rallies in tech push the US market (^DJI, ^IXIC, ^GSPC) to new heights in 2026, are retail investors still as engaged with these market dynamics that come with these massive valuations?
Yahoo Finance Senior Reporters Ines Ferré and Brooke DiPalma comment on the latest trends in retail trading activity observed by JPMorgan.
some good data out this morning. I think uh and as you were looking at it too on retail investors. Uh the retail investor remains very engaged with this market. Um, even if they have to buy stocks at higher valuations.
Yeah, look, um the retail investors have been buying the dip and I know that Brooke has also been looking into that, but there is there does seem to be this sense of decoupling when it comes to what's happening with equities and what we've seen from the inflation prints. You still have oil prices that are still elevated. At what point, as you mentioned, do you start to talk about rate hikes and certainly the market seems to increasingly not be expecting rate cuts at at any point this year.
Brooke, what are these retail investors buying?
Right now, we got this note out from JP Morgan this morning. They took a look over the week of May 7th to May 13th, so just yesterday. and we're actually seeing them trimming their exposure to software over this past week. According to that note from JP Morgan. let's take a look at some of the top stocks that investors are turning to and some of them that they're turning away from. So the top five retail stocks last week that investors turned towards were actually Nvidia. On top of that, too, you also had Tesla, Sandisk, Google, as well as ASML. That's where investors were turning to last week, trying to get exposure there. But where we saw some of the biggest turns down was actually, um, Microsoft. That was some of the biggest, uh, lo- losers, I guess you could say last week. Microsoft, Qualcomm, uh, Rocket Lab. We also had people turning away from Palantir and Netflix. And JP Morgan pointing out on this note that particularly for Microsoft and Palantir, they said that the second most sold month to date in May, uh, for, uh, Tesla, that that was, um, sorry, Microsoft, for example, shifted from the second most bought stock in April behind Tesla to the second, right, most sold month to date in May and most sold last week. And so clearly, these are investors that are are taking their gains and turning away, maybe perhaps rotating out of these companies that we've been talking a lot about.