Episode summary
Dylan Jovine | When Does the Bull Market End?
Summary
Dylan Jovine argues that the current bull market is being driven more by AI enthusiasm than by oil-related fears, saying the AI trade is exerting stronger upward pressure on stocks than the drag from higher oil prices. He frames the rally as a capital-spending cycle led by the Mag 7, which he says will spend more than a trillion dollars this year on semiconductors, software, AI companies, and data centers.
His base case is that the bull market can keep running for another year or two as long as that build-out continues. The main downside risks, in his view, are a clear slowdown in Mag 7 spending or a future Federal Reserve tightening cycle after the midterms. He says a new Fed chair is unlikely to raise rates before then, but that policy shift would be the main force that could pause the advance.
Jovine also revisits a lesson from the dot-com era: the biggest mistake younger investors make is chasing short-term action instead of holding quality names. He argues that the real money in bull markets comes from waiting, staying with core positions, and letting strong companies compound over time.
Key takeaways
- Dylan Jovine says AI is currently a stronger market force than oil, with AI-related spending overpowering geopolitical fear around oil prices.
- He says the Mag 7 will spend over a trillion dollars this year, and that spending is what is keeping the bull market alive.
- Jovine thinks the rally could have another year or two of runway if the current data-center and AI build-out continues.
- The main threats he sees are a shutdown in Mag 7 capex or Fed rate hikes after the midterms.
- He argues that investors make more money by holding core positions through a bull market than by constantly trading in and out.
Notable quotes
“AI seems to be more powerful than oil. So, AI greater than oil”
“the Mag 7 has got to spend over a trillion dollars this year. A trillion dollars, okay”
“The bull market ends when the Mag 7 stops spending the trillion dollars a year”
“You probably have a year to two”
“the real money in a bull market is made in the waiting”
How the episode opens
Good morning. This is Don Jovaneau behind the markets, happy Tuesday. Today is Tuesday, May 12.
When will the bull market end? What is causing this bull market? It's a question I'm asked a lot.
I've also have been asked a lot of our members write in and say, "Hey, I saw you recommended this. I own this, but it it's really high. Should I get into this?
Should I get into that? Let me tell you a couple things. It forced me this weekend, while I was laid up at home, kind of sick, coughing up a lung, I started thinking about this and I figured, "How do I put this in context?
Why don't I do a check-in on the market? Here's my general check-in. The bull market Oh, first of all, AI seems to be more powerful than oil.
So, AI greater than oil. The AI bull is exerting a greater upward push on the market than the drag on oil is pushing the market lower. So, AI is exerting stronger gravitational pressure on the market than the fear of spiking oil vis-a-vis the Iran conflict is, clearly.
The other thing is when does the market end? First of all, who knows when a bull market ends, right? But I'll tell you one thing, the Mag 7 has got to spend over a trillion dollars this year.
A trillion dollars, okay? Now, all that money is going to all these semiconductor stocks and software companies and AI companies and data centers and this one and that one, all that. The bull market ends when the Mag 7 stops spending the trillion dollars a year.
So, in my view, you have just listening to their calls, reading these earnings reports, I don't actually listen to them, I just read them.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- bull market timing
- ai spending momentum
- mag 7 capex
- semiconductors and software
- fed rate hikes
Watch the episode
Watch “Dylan Jovine | When Does the Bull Market End?” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
More from Behind The Markets Podcast
-
Nvidia CEO Out: 4 Reasons I’m Not Panicking About Nvidia -
The Mag 7 Sell-Off: My 3 Secrets to Picking Stocks -
Morgan Stanley’s AI Winners List Is Full of Bank Stocks -
Anthropic IPO: Why I’m Not Rushing to Buy at $1 Trillion -
Chip Stocks Sell-Off: Why the AI Build-Out Just Went From 3 to 5 Years -
Midterm Election Results: The Stock Market’s Winners and Losers
Behind The Markets Podcast, this episode and its artwork belong to their owners. Octagon is not affiliated with the show; this page is an independent summary.
