Investors are hedging less. The 1-month put-to-call skew is down to 1.15 points, the lowest since April 2025. This metric measures how much more investors are paying for downside protection against a stock market drop compared with bets on further gains. Skew has fallen -0.13 points over the last 4 weeks, a similar decline to the one seen in April 2025 following the "Liberation Day" selloff and subsequent tariff pause relief rally. Furthermore, the 3-month call skew is up to 0.9 points, the highest in at least 12 months. This metric measures how much more investors are paying for far-out-of-the-money call options, which only pay off in a large market rally, compared to at-the-money calls. Investor risk appetite is off the charts.

Investors are worried about Big Tech's debt. Oracle's, $ORCL, 5-year credit default swap (CDS) has surged +70 basis points year-to-date, to a record ~215 basis points, the largest increase among Big Tech companies. This is followed by Broadcom, $AVGO, whose 5-year CDS has risen +48 basis points over the same period. Meta’s, $META, 5-year CDS is up +39 basis points, to 95 basis points, the highest since trading began in October 2025. Nvidia's, $NVDA, 5-year CDS is up +32 basis points so far in 2026 to ~82 basis points, the highest since it began trading in November 2025. Furthermore, the 5-year CDS for Amazon, $AMZN, and Alphabet, $GOOGL, has increased +30 and +29 basis points, respectively. This comes as Big Tech companies have issued ~$200 billion in corporate bonds year-to-date, nearly double the full-year total for 2025. Credit markets are becoming increasingly worried about the cost of financing the AI race.

Investors are waiting to see whether higher defense budgets translate into more contracts, faster production, and stronger earnings—or whether political and economic pressures slow momentum. Meanwhile, newer defense tech companies hope to capture a piece of that spending.

Investors are piling into US equities at a record pace: US equity ETFs have attracted +$880 billion in inflows year-to-date, on track for their largest annual inflow on record. This already surpasses every full-year total except the all-time high set in 2025. Furthermore, current inflows are more than twice the levels seen at the same point in 2021 and 2025. At this rate, annual inflows will exceed +$1.4 trillion by year-end. This would be ~$500 billion above the 2025 record of ~$920 billion. Investor demand for US equities is unprecedented.

Investors are worried about Oracle's credit: Oracle's, $ORCL, 5-year credit default swaps (CDS) are up to a record ~203 basis points. This means protection against Oracle's default now costs ~$203,000 for every $10 million of principal. Oracle's CDS have more than QUADRUPLED since mid-2025, even surpassing the 2008 Financial Crisis peak. The company’s borrowing costs are also rising, with the spread on its 6.7% notes due 2056 widening +8 bps on Monday, to 263 bps, and its 5.7% notes due 2036 widening +9 bps, to 205 bps. Meanwhile, S&P Global Ratings downgraded Oracle to BBB- on July 9th, just 1 notch above junk, citing its rapidly growing AI-related spending. Oracle's credit risk is at crisis levels.