7 Inflection Points Investors Shouldn’t Ignore Right Now

Inflection point overload? Amid a bevy of potential inflection points for the market and economy which ones are near and/or will prove most significant?

Let review them.

Iran War

I didn’t have this as an inflection point, I think we were in a “range” of more or less escalation. I still think we are in that zone, but the risk that this conflict becomes a broader market issue is starting to increase.

AI Spending

This is the most important potential inflection point for the market and the economy. Is it slowing at all? Are there bottlenecks that will slow it, even if it doesn’t want to be slowed? The market seems to oscillate back and forth. While I think the answer remains to be determined, there are many stocks in the sector down well into double digits on a percentage basis in recent weeks, so maybe the market already answered the question and we can move on?

Earnings

I rarely focus on earnings. About 70% of companies will beat earnings and Wall Street (checks calendar) will act surprised for the 200th quarter running! But this time I will pay more attention than usual.

Last quarter, earnings really seemed to be what turned the stock market around. We can argue and nitpick that it was possibly too few sectors that really drove the earnings story (lots participated, but there were some really positive outliers). More recently, a chip company’s earnings call set the stage for the latest rebound in tech as it convincingly laid out the case for strong demand, and more importantly, committed orders for years to come.

I’m not about to go all in on understanding the earnings season dynamics, but I will be paying closer attention. It is nice that many companies will combine to determine how good earnings season is for the market, as for a few quarters it all seemed to hang on Nvidia (NVDA).

Russia/Ukraine

Are we nearing an inflection point here? From “how are you dressed in my office” to sure, we can set up a patriot missile factory in your country, the relationship between President Trump and President Zelensky has changed.

I can’t remember the last time the president played the “droog” card with Putin. A Clockwork Orange had many “slang” words (Nadsat) based on Russian words (some argue Ukrainian) so it seemed like an appropriate time to insert a reference.

In any case, the war is changing. Russia is attacking Ukraine more heavily (dangerous for Ukraine, but likely a sign of things getting worse for Russia). Increasingly Ukraine is being allowed to follow a military plan along the lines of what our GIG would have drawn up on day 1 (there have been restrictions on what they could do, even when they had they right hardware, on top of lack of access to some hardware).

Trump hinted that the U.S. now has mineral stakes in Ukraine during his recent trip. If there is a peace deal of any sort, expect opportunities for investments in Russia and Ukraine. Expect Poland to be a staging ground for many U.S. operations (corporate, investment and military) into both Ukraine and Russia.

Peace doesn’t seem close, but with both sides having more firepower, as well as their own sets of difficulties, maybe we are nearing that time?

Japanese Yen

The infamous carry trade.

Both times we had steep declines in the USD vs JPY, we saw U.S. equity markets sell off. The summer of 2024 was linked to the carry trade, while spring of 2025 was more about tariffs and Liberation Day.

Is the yen going to continue to decline? By all accounts, betting against the yen, especially after recent attempts at intervention has failed, is a popular trade (dare I say, consensus?). The case for a weaker yen, makes a lot of sense, but, as a contrarian, the opportunity for a rapid appreciation seems worth paying attention to, if not betting on.

Crypto and DATCos

Digital Asset Treasury Companies have been both a blessing and a curse to crypto. The companies certainly provided a lot of support on the way up.

Some DATCos do a lot with their crypto and are heavily involved in the infrastructure of the space. Others seem to be accumulation vehicles, where their sources of funds to accumulate have grown more complex.

There is no arguing that the Trump administration has been pro-crypto. The enthusiasm post 2024 election is obvious. The naming of the crypto czar and an accommodating regulatory environment helped push crypto to all-time highs. It has been a “dark” time since then.

While headlines have generally been positive, crypto has struggled. In recent weeks, much of the selling has been attributed to Strategy (MSTR) selling bitcoin to fund some of its “debt” servicing requirements (really preferreds). The “security” best known as STRC (STRC on twitter) has been front and center about recent angst. That security seems to have bottomed as the Strategy team has announced several steps (changing the payment schedule, increasing the dividend, and selling a larger amount of crypto to raise more USD).

Have they done enough to alleviate market fears? Is this an inflection point, where the market can move beyond the current needs of some DATCos and focus on potential upside from the administration continuing to embrace crypto? Or are we headed to new lows, despite that support, which would be scary.

My expectation is that the bounce we’ve seen will be short lived, as FOMO in crypto is almost gone (very few advisors not already allocated to crypto seem that excited at the prospect at the moment). And the gambling/get rich quick crowd has long since moved from crypto. Watch this market as the next leg is likely to be important for overall market sentiment/cash flows.

South Korea Stocks and Recent IPOs

This is a last minute addition as South Korea has traded really poorly to start the week and that is dragging tech stocks down (the timing after Friday’s SK Hynix (SKHY) IPO isn’t good). I’m also keeping an eye on SpaceX (SPCX) to see if it tests its IPO price.

Bottom Line

Lots of possible inflection points, and the U.S. “seems” to want to buy the open, but I’m very underweight risk, especially tech risk right here. I think the inflection points are more likely to break against further risk taking!