(These are the market notes on today's action by Mike Santoli, CNBC's Senior Markets Commentator. See today's video update from Mike above.) Upward drift in a few of the tech heavyweights was enough to keep the big-cap indexes churning ahead to new records, while the majority of the market takes a breather after bulls got most of what they were hoping for this week. Apple benefiting from upgraded expectations for uptake of its newest iPhone models, allowing one of the laggard Magnificent 7 names to carry the tape for a bit. Market breadth was soft, the median stock sagging a bit but still in for a decent week. The small-cap Russell 2000 pulled back somewhat, down three-quarters of a percent after having broken to a new high for the first time in almost four years, prompting applause from chart watchers who insist it's only the beginning of a comeback tour. "No such thing as a triple-top," they say, adding that urgent outflows from small-cap funds in recent months – the heaviest since 2020 - reflect capitulation and a contrarian comeback signal. Fair enough, though there is always a fairly narrow lane of macroeconomic and policy conditions that would allow for sustained small-cap outperformance : Lower Fed policy rates and bond yields, an acceleration in growth, generous credit conditions and continued speculative aggression among individual investors. Bond yields leaking higher since the Fed cut rates a quarter-point on Wednesday is not atypical, and — so far — is not alarming equity markets, inflation watchdogs or fiscal hawks. Unless/until the 10-year Treasury yields gets above 4.25% or so (from 4.13% now) with some oomph behind it, this should remain the case. Tesla , Palantir and Robinhood shares all up 7% or so this week speaks to a re-energized go-go adrenaline trader. These stocks are affinity emblems, their shareholders using them to express enthusiastic allegiance to iconoclastic, charismatic founders, with stupendously expensive valuations that capitalize vibes and faith in a particular future more than a focused assessment of discounted forward cash flows. Continued abundance of chatter around the current cycle relative to the late-'90s tech-bubble run . JP Morgan, Bespoke and Bank of America are among the firms plotting the ways that this market (either since the launch of ChatGPT or since the April V-bottom mini-crash) are roughly following the Internet mania. All of them place us somewhere in 1997, 1998 or 1999, with the upside acceleration, euphoric sentiment and hyperactive capital markets mostly ahead of us. As I always say, nothing guarantees us a rerun of that episode, but no one can rule it out. It helps to know what game one is playing, even if it's not clear how much time is left on the clock.
