Market Sector Tracker - Gary Kaltbaum Analysis

Last Updated: September 29, 2025

🎯 GARY'S KEY THEMES (Updated Sept 29)

CLIMACTIC TOP WARNING - "We have a sneaking suspicion this technology move may end in some sort of climactic move like 99 and early 2000"
Record Market Concentration - 9 stocks = 70.34% of NASDAQ 100, 8 stocks = 37% of S&P 500 (record levels)
Sector Weighting at Bubble Levels - Technology/communications at 34% (back to 1999-2000 levels), healthcare down to 9% (median is 17%)
Mean Reversion Coming - "Eventually this will go back to the norm. Always has, always will"
No-Sales Biotech Carnage - Three companies down 50-90% in ONE DAY, Gary "really pissed off" at analyst buy ratings
IPO Destruction Continues - Hot IPOs crashing 50%+ within days/weeks of opening
Avoid List Still Expanding - Travel topping confirmed, retail crashing (Target new yearly lows)

Gary's Big Picture: Market showing classic bubble top characteristics with record concentration and sector weighting at 1999-2000 levels. He's positioned for potential climactic move but ready to sell into it. "Could be three years, two years, one year, six weeks. It wasn't today. It won't be tomorrow."

⚠️ BUBBLE WARNING SIGNALS CRITICAL LEVEL (Sept 29)

Biotech Crashes - The Proof Is Here

Moonlake Immunotherapy: $62 → $6.25 (down 90% in ONE DAY) - no sales, came out as SPAC in 2020
IO Biotech: $1.48 → $0.36 (down 77% in ONE DAY) - no sales biotech, came out at $14 in 2021
Applied Therapeutics: $1.24 → $0.61 (down 51% in ONE DAY) - was $59 in 2019, no sales
Analyst Response: Downgrades from "buy" to "hold" or "neutral" AFTER 90% crash - Gary "really pissed off"

IPO Carnage Accelerating

Klarna (KLAR): $40 deal, opened $57 → $38 in 2.5 weeks
Figma: $33 deal, hit $142 in one day → $53 four weeks later
Gemini Space Station: $28 deal, opened $46 → $24 in 9 days (nearly 50%)
Chime Financial: $27 deal, opened $44 → $20 (more than 50%)
StubHub: $23.50 deal, opened $28 → $17.26 in 8 days
Pattern: Gary has "about 15 others" showing same crash pattern

Record Market Concentration

NASDAQ 100: 9 stocks = 70.34%, leaving 91 stocks at less than 30%
S&P 500: 8 stocks = almost 37%, leaving 492 stocks at only 63%
Equal Weight Context: Each stock should be 0.2% if equal weighted, but only 94 stocks above 2%, 406 below
Gary's Take: "Record concentration in the market"

Sector Weighting at 1999-2000 Bubble Levels

Technology/Communications: Now at 34% (back to 1999-2000 peak levels)
Healthcare: Down to 9% (median is 17%)
Valuation Example: Palantir $400 billion market cap with $3 billion in sales
Mean Reversion Warning: "If the market reverts to the mean, there's going to be one hell of a drop in technology and communication stocks"

Climactic Top Indicators

Gary's explicit warning: "We have a sneaking suspicion this technology move may end in some sort of climactic move like 99 and early 2000. If it does, we will be thrilled and hope to be smart enough to sell into it while everybody else is in a lather."

Timeline: "Could be three years, two years, one year, six weeks"
Trigger: "If we start seeing a vertical move in the NASDAQ and NASDAQ 100, that'll be it"

🚨 ECONOMIC WARNING SIGNS INTENSIFYING

Oil Prices: "Ticking up" past couple days (Gary very concerned)
Food Inflation: Hershey bags $11.99→$16.99, coffee up, chip bags smaller
Yield/Energy Double Threat: Both rising simultaneously - major cost pressure

Real-World Observations (Sept 19):

Airports: Orlando International "quiet", LaGuardia "kind of quiet"
Transportation: Taxi drivers report "very quiet" business
Vegas: Traffic down 12% - "they went too far" with pricing
Housing Markets: Central Florida seeing significant price cuts
- Example: $1.79M → $1.59M in 30 days
Gary's Take: "We think something's up on the economy"

📊 Key Market Metrics (Sept 29) - CLIMBING THE WALL

Dow: Up 68 (Caterpillar +6, NVIDIA +3.50, Microsoft +3.50, IBM -4.50)
S&P: Up 17
NASDAQ: Up 107
NASDAQ 100: Up 107

Record Concentration Metrics

NASDAQ 100: 9 stocks = 70.34% (91 stocks = less than 30%)
S&P 500: 8 stocks = 37% (492 stocks = 63%)
Equal Weight Analysis: Only 94 of 500 stocks above 2% weight (should be 0.2% each if equal)
Half the S&P: 250 stocks represent tiny fraction of index value

Sector Weighting - AT BUBBLE EXTREMES

Technology/Communications: 34% (back to 1999-2000 levels, well above historical average)
Healthcare: 9% (median is 17% - massively underweighted)
Gary's Warning: Mean reversion will cause "one hell of a drop" in tech, "one heck of a rally" in healthcare

Interest Rates & Commodities

10-Year Yield: Came down today (good news), watch 4.2% level - "move above 4.2, you'll hear from me"
Oil: Down $2.50 today (good news)
Gold: 352 (up from 318 breakout four weeks ago) - "no respite, just another new high"
Silver: Also making new highs

🔴 SECTORS TO AVOID (Bearish/Downtrending)

Retail - CRASH ACCELERATING 🔴

Target: All-time high $269 → $88.83 (new yearly low), sales down, earnings down 20% last quarter, 36% quarter before
Gary's Comparison: "Walmart is filet mignon, Target is spam"
Lululemon: "Crash" mentioned specifically
Definable Downtrends: Many retail names in clear bear markets

Travel & Consumer TOPPING CONFIRMED 🔴

Cruise Lines: "Look like they've topped" - Carnival gapped up, sold off heavy volume, Royal Caribbean below 50-day
Hotels: "Just letting you know" - weakness continuing
Restaurants: "Bearish" - McDonald's in Dow, Kava Group 172→58 since November
Gary's Warning: "Not 100% sure but evidence in today, they've got a little mallet over their head"

Healthcare & Biotech - DISASTER ZONE 🔴

Big Biotech: Amgen in Dow "week," most drug stocks "bearish"
Three Biotechs Crashed 50-90% Today: Moonlake, IO Biotech, Applied Therapeutics (all no-sales)
Medical Research/Products: "A lot of them, bearish trend"
XLV (Healthcare ETF): "Very weak"
Big Pharma: Bristol-Myers bearish, Eli Lilly "bearish" (despite hype), Merck "big bear"

Consumer Staples/Products BROAD BEAR MARKETS

Food & Beverage: "Bearish"
Alcohol: "Big bear market" - less consumption across the board
Tobacco: "Getting hit too" (was holding up)
Household Products: Procter & Gamble in Dow - "bear markets, bearish"
Consumer Staples: Broad weakness across entire sector

Industrial & Transportation - PERSISTENT WEAKNESS

Rails: Most in bad shape (except Union Pacific/Norfolk Southern merger)
Truckers: "Pretty much bearish" - Old Dominion Freight weak
UPS: "Big bear market" - "don't you dare look"
Boeing: In Dow, "looks like it's topped"
Honeywell: In Dow, weak

Financial Services & Insurance

Insurance: "Pretty much downtrends, bearish"
Salesforce: In Dow, "big bear market"

Other Sectors

Furniture: Got hit on tariff news
Oil: "Very mixed" - few at new highs, plenty at new lows

🟢 LEADING SECTORS (Strong/Bullish)

Technology & AI - STRONG BUT EXTENDED 📈

AI Semiconductors: "Good day" - out of the chute strong
Semiconductors: "Not the semiconductors" (in avoid list) - meaning they're FINE
NVIDIA: Up $3.50
Microsoft: Up $3.50
IBM: Down $4.50 (after quantum rally last week)

Emerging Leaders - NEW RELATIVE STRENGTH

Carvana: "Very good relative strength and potentially good patterns"
DoorDash: Strong day, good relative strength
Shopify: Up $9 to $149 on AI/ChatGPT payment news with Etsy
Etsy: Up $10 to $74 on Shopify partnership
AppLovin (APP): Strong day
Robinhood: Up 11% (attaches to Bitcoin), up another 1% aftermarket
TKO (owns WWE): Strong day
Roblox: Strong day (Electronic Arts going private for $50B helped sector)
Take-Two Interactive: Up nicely

Financials - ROCK SOLID

Big Banks: "Not the big banks" (in avoid list) - meaning they're FINE
Goldman Sachs: "Certainly not Goldman Sachs" - strong
JP Morgan: "Certainly not JP Morgan" - strong
Financials Broad: "Not the financials" - meaning they're working

Gold & Miners - PARABOLIC MOVE 🚀

Gold: 318 breakout → 352 in four weeks, "no respite, just another new high"
Silver: Also making new highs
Gold Miners: "Even much stronger" than gold - broke out first (bullish signal)
Gary's Take: "Dang, this move has been bullish as all hell"

Chinese Stocks

Broad Strength: "Not Chinese names" (in avoid list) - meaning they're working

Crypto - STRONG BOUNCE

Bitcoin: "Real strong bounce" - still below 50-day but "today we'll go a long way" to getting back above
Ethereum: "Bounce too, not as strong" - brought related names along
Note: Still below 50-day moving averages but showing life

Other Strong Areas

Marijuana Stocks: Strong day on presidential CBD/marijuana benefits post
One Biotech Bought Out: Meris (MRUS) up 36%, bought for $6.5B despite little sales/big losses

🟡 SECTORS SETTING UP / NEUTRAL

Market Context

Distribution continuing Sept 25 - weakness expanding beyond initial warnings
Fed policy expectations shifting (new Fed member wants 2% Fed funds)
Concentration risk at extreme levels (10 stocks = 41% of S&P 500)

Watch List

Small Cap: Russell 2000 - Gary took cautious position after previous stops
International: Selective opportunities may emerge
Defensive: May become leadership if growth concentration fails

💡 TRADE NOTES & SETUPS (Sept 29)

Gary's Active Positions & Trades

Bought market on confirmation day after Trump tariff crash
Owns "some of these things" (tech stocks) but ready to sell into climactic move
Watching 10 stocks daily - if they go bear market, indices follow
Russell 2000: Still holding small position from previous entry

Critical Technical Levels to Watch

10-Year Yield: 4.2% is the line - "A move above 4.2, you'll hear from me. Staying below good, getting above potentially not so good"
Bitcoin: Still below 50-day, needs to reclaim
Ethereum: Still below 50-day, needs to reclaim
Cruise Lines: Watching for confirmation of tops (Carnival, Royal Caribbean)

Stocks with New Relative Strength

Not buy recommendations - just noting patterns:

Carvana, DoorDash, AppleOven (APO), Shopify, Etsy, Robinhood, TKO, Roblox, Take-Two Interactive

Oracle Update

No specific mention in Sept 29 show after breaking $300 support earlier

Gary's Climactic Top Strategy

Timeline: "Could be three years, two years, one year, six weeks. It wasn't today. It won't be tomorrow"
Trigger: "If we start seeing a vertical move in the NASDAQ and NASDAQ 100, that'll be it"
Plan: "We will be thrilled and hope to be smart enough to sell into it while everybody else is in a lather"
Preparation: "We've done some exhaustive studies on this. Don't be left holding the bag"

Target vs Walmart - Case Study

Gary uses Target as cautionary tale:

Target: All-time high $269 → $88.83 (new yearly lows), sales down, earnings down 20-36%
Walmart: "Filet mignon" - strong
Lesson: "Go take Target's chart and overlay it on Walmart" - shows importance of avoiding weak sectors

Wall Street Criticism

Gary "really pissed off" about:

Analyst buy recommendations on no-sales companies that crashed 50-90%
Downgrades from "buy" to "hold/neutral" AFTER 90% crash
IPO firms opening deals hot then watching them crash 50%+
"Investment bankers, the big names are just putting out crap"

Next Update: [Date of next Gary Kaltbaum show analysis]

Monday, September 29, 2025