You have the difficult task of explaining to me what's happening. You know, I look at each index, and the biggest points boost is in media, and we say that they whipsawed in the session, having had its biggest drop since April. In yesterday's session, at times the biggest drop since March of 2020, which dragged the Sox to its biggest drop since March of 2020. What is happening? Well, there are two major explanations in this story. The first one is the air fatigue. So we have seen last week NVIDIA reported low results, but investors were not satisfied. That's one part of the story. And the second part of the story is on ideal macroeconomic setup, where the Fed is expected to start cutting interest rates from September this year, cuts a few times, and that has been seeing a rotation from technology companies toward the non-technology pockets of the market. And because NVIDIA has been one of the stars of this technology rally, and it's

normal that investors are going after NVIDIA when the market conditions are no longer ideal for the company. If do we brace ourselves for more days like yesterday? Yes, we do. We do expect to have more volatility moving forward because, again, as I said, right now, the market's narrative, the market's focus is shifting from the individual corporate news, which remain robust, by the way, toward an ideal macroeconomic set up, which is expected to be a bearish for technology stocks and more bullish for the cyclical and non-technology pockets of this market. And because stocks like Nvidia have gone well to very lofty valuation levels, we do expect to see a sizable downside correction if investors decide to keep this rotation going. I do think it's important that we continue to discuss the big news item, which is Bloomberg's reporting that Nvidia received a subpoena from the Department of Justice. And I simply look at the market

reaction. The stock is up near session highs now, having been down almost 4%. What does that tell you about the market's attitude towards this story in and of itself? Well, listen. The DOJ allegations, antitrust investigations, are part of the daily life of a big technology stock. They come and they go. Sometimes they lead to deeper investigations. Sometimes they lead to legal actions. Sometimes they lead to fines. Yes. Yes. We have seen that in the past decade. And so, these investigations or fines or actions taken against the big technology companies have not stopped them from becoming bigger, better, and more influential. So, I think from an investor perspective, the DOJ investigation is not the major issue. I think a major issue is rather the rising competition, for example, which could naturally start eating into, and we guess, huge profit margins. Epic, you've done a beautiful job of telling us the whys. What then? How do investors protect to any more

bouts of volatility? What is the market telling you as to the way they're searching to protect on the downside? Well, always you have options. You have all the kind of financial products with what you investors should right now. Really think of this with shuffling their portfolios in a way to adopt them for a period of loosening monetary policy from the Fed and potentially for the economic slowdown. So this is, I think, very much important now last year. And so we have seen the technology stocks as a safe haven, the safe place where investors just went and seek refuge from the higher interest rates. And now the opposite scenario is about to happen. So I think that in all cases, the technology stocks will remain under a decent selling pressure. But now we it does not mean that the air rally is over. It just means that we expect to see at least some downside correction in technology stocks and the portfolios have to be reshuffled accordingly.

Let's finish this discussion with the calendar. There's still more to come, right? Broadcom is top of mind for us on the show. And then the feds because it's top of mind for everyone. What happens next? Well, Broadcom is expected to announce strong quarterly results, and part of it is due to the growing demand. A quarter is due to a rebound that we have seen in networking equipment sales like Cisco. A part of it is due to the way in layers transition from perpetual sales to subscription model. So we do expect Broadcom to come up and announce probably better than expected results. Now does unfortunately not mean that great results will stop bleeding in Broadcom if the macroeconomic data file doesn't support market.

Swissquote Analyst: Brace for More Volatility

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