This industry is in the 1st inning of what could be a massive bull market

Today’s issue in preview:

• This industry is in the 1st inning of what could be a massive bull market

• Donald Trump and Big Tech are teaming up to send these stocks much higher

• Why you should prepare to hear the U.S. economy is booming

This industry is in the 1st inning of what could be a massive bull market

Credit:Vertigo3d

It looks like the market is coming around to our idea that a genomics bull market is starting.

Yesterday, the ETF we use to track this theme – the ARK Genomics Revolution Fund (ARKG) – surged 7.6% to reach a new one-year high. Plus, high-profile industry leaders 10x Genomics (TXG), Twist Bioscience (TWST), and Illumina (ILMN) reached new one-year highs. Fellow high-profile leaders Natera (NTRA) and Tempus AI (TEM) climbed 6% and 10%, respectively.

In other words, money is starting to flow broadly into the genomics theme.

Could this theme get labeled with “next big AI trade” and therefore get AI-rocket fuel powering a bull market?

I believe it could.

On May 28, I looked at the genomics sector’s recent price strength and came away bullish and expecting an upside breakout.

Genomics is the science of analyzing human DNA – often referred to as the “software code of life” – to create tests, medicines, and treatments.

Years of innovation in this field have us on the brink of creating many customized treatments based on an individual’s DNA… and even “editing” genes to cure disease. Bulls on the industry believe it will get a giant “AI boost,” since super-intelligent computer programs can analyze genes and treatment effects so well… and have the potential to create drugs on their own.

The fusion of AI plus genomics should generate dozens of compelling stock narratives over the coming years. Researchers running superintelligent AI programs will be able to run millions of digital simulations of drugs and treatments. This will put medical innovation into overdrive… and create many big stock market winners.

The personalized approach to medicine that genomics offers has us on the cusp of a historic revolution in healthcare. Ten years from now, medicine will be transformed… and a lot of money will be made along the way.

As I mentioned on May 28, ARKG is one way to track and trade the genomics theme. It owns a basket of bleeding-edge genomic companies. Its largest holding, Tempus AI, is often cited as a premier way to play “AI in health care.” ARKG also holds significant positions in genetic diagnostic service firms Natera and Illumina… plus positions in promising “gene editing” companies CRISPR Therapeutics (CRSP) and Intellia Therapeutics (NTLA).

As you can see in the ARKG chart below, the market likes the bull case for genomics. Money is starting to flow into this sector. And if the investment public begins to see it as another “AI trade,” returns will be large.

Donald Trump and Big Tech are teaming up to send these stocks much higher

Credit:Gerville

It took a while… but the construction equipment rental industry finally joined the U.S. factory and data center building boom.

This week, America’s two largest construction equipment rental firms – United Rentals (URI) and Sunbelt Rentals (SUNB) – broke out of sideways consolidation patterns to reach new one-year highs.

These two businesses are starting to enjoy the tailwinds of the U.S. factory and data center building boom.

Avid Money & Megatrends readers are familiar with these financial forces. They’ve powered one of our biggest home run trades.

In October 2024, I sent a note to colleagues that covered the bull case for investing in Engineering & Construction (E&C) stocks. I described them as a vehicle for investing in the AI data center building boom. I’ve reiterated my recommendation many times in M&M.

E&C firms design and build giant infrastructure projects, such as electric power plants, data centers, transmission lines, factories, airports, and skyscrapers. Well-positioned firms in this space are enjoying soaring revenues thanks to Big Tech’s race to build AI data centers… a race that will see the likes of Google and Amazon invest a colossal $700+ billion this year… and more than $3 trillion after that.

E&C firms also have a “Donald Trump kicker” in the form of our president’s efforts to massively increase U.S. manufacturing capacity. This push will see trillions of dollars spent on building new factories and the power grids required to operate them. Apple (AAPL), for example, has committed to invest $600 billion in U.S.-based manufacturing over the next four years. Nvidia (NVDA) says it will invest $500 billion in U.S.-based manufacturing over the next four years.

In other words, the world’s richest, most powerful companies are spending money on an epic scale. And they are moving as fast as they can. Plus, a forceful president has staked his legacy and reputation on expanding U.S. manufacturing capacity and winning the AI race.

Given the extreme urgency behind Big Tech’s data center buildout and Trump’s manufacturing push, the bidding process for many infrastructure builds consists of E&C companies throwing out absurdly high bids… then Big Tech or the White House replying, “Sure, we’ll take five of them. Can you start yesterday?”

This situation has made E&C firms some of the market’s leading stocks over the past year. E&C giant Sterling Infrastructure (STRL) is up 415% over the past year. Fellow leader Argan (AGX) is up 221%. Fellow leader MasTec (MTZ) is up 138% over the past year.

A multi-year factory and data center building boom should not only benefit construction firms… but also construction equipment rental firms. Big construction rental firms like United and Sunbelt rent all kinds of construction equipment, like forklifts, skid loaders, scissor lifts, pumps, generators, and excavators, to construction firms large and small.

In many cases, construction companies don’t want to tie up capital and storage space by owning lots of equipment… so they are repeat customers of United and Sunbelt.

As the factory and data center building booms continue, expect a lot of money to flow into construction firms… which will, in turn, flow into construction equipment rental firms. These recent upside breakouts should lead to higher stock prices ahead.

Why you should prepare to hear the U.S. economy is booming

Credit: CHUYN

Over the past nine months, I’ve published over a dozen research notes analyzing powerful uptrends across industries such as trucking, steelmaking, railroads, hotels, construction equipment, and shopping malls.

At the end of each note, I pointed to their soaring stock prices and told readers that the U.S. economy is doing a lot better than most people think.

Each of the above industries is highly sensitive to ups and downs in the U.S. economy. Their fortunes rise and fall with America’s ability to build infrastructure projects, go on vacation, transport goods, spend money at the mall, and generally just “get along.” And most people don’t realize this, but stock prices in those industries are booming.

This exceptional price strength across a broad swath of critical companies that are highly sensitive to U.S. economic health suggests the economy is actually doing very well. Industries involved in making things, transporting things, and buying things are enjoying growing revenues and rising stock prices.

And keep in mind: The stock market is one of the world’s greatest forecasting mechanisms. It tends to look ahead 6-12 months. When an industry is in a recession, its stock prices will rise before the news media says it is recovering. When an industry seems to be doing well, its stock prices will decline before the news covers its downturn. This is often called “discounting the future.”

This week, the market sent us more signals that the economy is doing well… and that we should expect to see headlines about strong economic growth later this year.

This week:

• Shares of trucking industry giants J.B. Hunt (JBHT) and Old Dominion Freight Lines (ODFL) reached all-time highs.

• Shares of giant steelmakers Nucor (NUE) and Steel Dynamics (STLD) reached new all-time highs.

• Shares of hotel giants Marriott (MAR), Hyatt Hotels (H), Hilton Worldwide (HLT), and InterContinental Hotels Group (IHG) reached new all-time highs.

• Shares of shopping mall giants Simon Property Group (SPG) and Macerich (MAC) reached new all-time highs.

• Shares of construction equipment giant Caterpillar (CAT) reached a new all-time high.

• Shares of construction equipment rental giants United Rentals (URI) and Sunbelt Rentals (SUNB) reached new all-time highs.

• Shares of financial giants Goldman Sachs (GS) and Morgan Stanley (MS) reached new all-time highs.

In other words, America is building a lot of things, it is transporting a lot of things, and it is buying a lot of things at the mall. And as shown by the new highs in Goldman and Morgan, the business of financing all that activity is booming.

As of today, June 5, it has been 97 days since the U.S. and Israel began joint military operations against Iran. Despite many White House announcements hinting that a lasting peace deal is close, the war continues.

This means the investment world’s biggest debate of 2026 is still going. You could call this debate “The Doomers vs. The Optimists.”

The Doomers say the Iran War’s constriction of critical Middle Eastern resources such as oil, natural gas, fertilizer, and sulfuric acid will lead to serious economic disruption, then a recession, and then a bear market.

The Optimists say those concerns are overblown… this, too, shall pass… and the economy and stock market will continue to grow.

The cluster of new highs detailed above shows that the market is clearly siding with the Optimists right now. Sure, the global economy has problems. It always does. But it also has some positives. And these positives are so strong that many key industries are doing very well.

This is war, Iran, and Donald J. Trump we are talking about… so anything can happen. But as of right now, the market is siding with the Optimists. Conduct your financial affairs accordingly!

Market Notes

• Clothing giant Lululemon (LULU) reached a new one-year low today. A group of new competitors has entered its market and is eating its market share. The stock is down 65% over the past year.

• The Boomer health care megatrend is alive and well. The Big Pharma-focused Invesco Dynamic Pharmaceuticals ETF (PJP) reached a new all-time high today.

• GLP-1 drug leader Eli Lilly (LLY) reached a new all-time high today.

Regards,

Brian Hunt
Editor, Money & Megatrends

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