Friday, 5 June 2026 · London Edition · 07:30 London

Hard assets are calling. Tech's 2020 warning says listen.

Join Tom, Gerald and Marie for this edition's podcast · 12 min Spotify YouTube

Signals

Tech rotation

Strategist Larry McDonald warns of a massive rotation from crowded tech into hard assets, citing a warning signal last seen in 2020. MarketWatch reports his call, noting the S&P 500 tech sector is flashing a pattern reminiscent of the pre-pandemic top. The trade is simple: dump over-owned tech and buy hard assets like gold and commodities.

GLD

Buy Gold — Hard assets benefit from tech rotation; GLD up 0.8% last session but still 19% below 52-week high, offering room to run.

“Larry McDonald warns that investors are piling into tech stocks thinking it’s the 'safe trade,' but should be thinking about hard assets instead.”

$411.3 +0.83%
DBC

Buy Commodities — Commodities as a key hard-asset class; DBC up 35% YTD and only 6% below 52-week high, but rotation could push it higher.

“Larry McDonald warns that investors are piling into tech stocks thinking it’s the 'safe trade,' but should be thinking about hard assets instead.”

$29.88 -1.35%
XLK

Sell Technology Select Sector SPDR — McDonald sees tech as crowded and due for a rotation; XLK near 52-week high, up 36% YTD, making profit-taking attractive.

“Larry McDonald warns that investors are piling into tech stocks thinking it’s the 'safe trade,' but should be thinking about hard assets instead.”

$193.2 -1.56%

Tencent AI agent

Tencent shares saw their biggest intraday gain since 2022 after the Financial Times reported the company is testing a prototype AI agent for WeChat. Nikkei Asia and FT both flag the development, with the potential to unlock new revenue from AI-powered services. The stock's volatile reaction suggests investors are hungry for China tech AI catalysts.

0700.HK

Buy Tencent — FT report of AI agent testing triggered largest intraday gain since 2022, signaling strong investor appetite for Tencent's AI potential.

Obesity drugs

Bloomberg reports Denmark will study whether Wegovy can increase workforce participation, adding a unique labor-market angle to the GLP-1 narrative. Novo Nordisk rebounded 4.2% last session but remains 46% below its 52-week high, still reeling from earlier selloffs. The study could broaden Wegovy's appeal beyond health to economic policy.

NVO

Buy Novo Nordisk — Potential labor-market endorsement could expand adoption; NVO jumped 4.2% last session but is still 46% below 52-week high.

$43.75 +4.17%

Crypto divergence

Crypto markets face a tug-of-war: ETF outflows totaling $4.4 billion over 13 sessions, led by BlackRock's IBIT, signal institutional bearishness, while Bitcoin Cash alone eked gains. Meanwhile, a wipeout in altcoins like NEAR (-15.2%) and HYPE on Arthur Hayes' exit, but Bitcoin showed relative strength, bouncing. MarketWatch counters that Bitcoin bears are premature, citing potential rebound. The divergence makes direction unclear, but altcoins are clearly under pressure.

BCH-USD

Buy Bitcoin Cash — Only green in CoinDesk 20, up 1.5%, showing relative strength in a weak tape.

ETH-USD

Sell Ether — Crypto ETFs bled $4.4B, with ETH joining the outflow wave; persistent bleeding points to near-term weakness.

NEAR-USD

Sell NEAR Protocol — CoinDesk reports NEAR demolished 15.2%, amplified by Arthur Hayes' exit.

HYPE

Sell Hyperliquid — Fell sharply as Hayes exited; only HYPE ETF products saw inflows, but spot token under pressure.

BTC-USD

Watch Bitcoin — Institutional outflows clash with contrarian bullish calls; Bitcoin held up relatively well amid altcoin rout.

Treasury hedging

Bloomberg reports the return of mortgage hedging activity in the Treasury market after the recent selloff, potentially adding selling pressure to long-dated bonds. TLT hovers just 3% above its 52-week low, already reflecting aggressive bearish positioning. The 'beast' could exacerbate downside if hedging flows accelerate, but the trade is crowded.

TLT

Sell Long-duration Treasuries — Mortgage hedging may amplify selling pressure; TLT at 52-week low, suggesting much is priced but still vulnerable.

$85.50 +0.22%

Indonesia commodities

Indonesia’s radical new export rules took effect with lingering uncertainty, causing shipment delays and straining Southeast Asia’s largest economy, Bloomberg reports. Copper and other commodity prices may benefit from potential supply curbs. EIDO is down 35% YTD and just 1% above its 52-week low, while CPER hovers near its highs.

CPER

Buy Copper — Export curbs could tighten supply of Indonesian commodities; CPER near 52-week highs, benefiting from scarcity.

$39.73 +0.79%
EIDO

Sell Indonesia equities — Export disruption adds near-term strain; EIDO already at 52-week lows, but further downside risk remains.

$11.99 -1.56%

EM diversification

MarketWatch reports emerging-market fund managers are diversifying away from top holdings TSMC, Samsung, and SK Hynix after strong runs, potentially broadening EM ETF inflows. TSMC is 1% off its 52-week high, while EEM sits 3% below highs. Forced rotation could support the broader EM complex.

EEM

Buy Emerging markets — Manager diversification may broaden EM ETF flows; EEM down 3% from 52-week high, room to catch up.

$69.10 -1.17%
TSM

Hold TSMC — Reducing overweight positions caps upside near all-time highs; TSM 1% below 52wH.

$444.9 +1.88%
SSNLF

Hold Samsung — Similar to TSMC, Samsung may face trimming pressure as funds diversify away from concentrated holdings.

$65.21 +0.00%

South Korea risk

MarketWatch warns that a potential rate hike in South Korea could trigger a 15% market correction, hitting tech-heavy stocks hard. EWY tumbled 4.2% last session but is still up 108% YTD, leaving plenty of room to fall if tightening materializes. The call is specific and actionable, though the timing of a hike is uncertain.

EWY

Sell South Korea equities — MarketWatch warns a rate hike risks a 15% correction; EWY down 4.2% last session but up 108% YTD, making it vulnerable.

$204.0 -4.22%

SpaceX speculation

CNBC reports traders are flocking to Echostar (SATS) as a proxy for SpaceX's rumored IPO, given its estimated 3% stake. Options volume is surging, and SATS rallied 3.1% last session, though it remains 15% below its 52-week high. The bet is a speculative play on SpaceX hype.

SATS

Buy EchoStar — SpaceX IPO hype drives options bets; SATS up 3.1% last session but still 15% below highs.

$124.6 +3.08%

Lithium supply

FT reports EnergyX’s plan to build a ‘Battery Mecca’ in Texas, aiming to disrupt China's lithium supply chain dominance. LIT and ALB are both off their 52-week highs, with LIT down 10% and ALB down 25% from peaks. A successful domestic capacity buildout could boost the lithium ETF longer-term, but near-term impact is muted.

LIT

Buy Lithium & battery tech — New US lithium production capacity could benefit LIT; down 1.9% last session, 10% below 52-week high.

$83.28 -1.86%
ALB

Hold Albemarle — EnergyX is a startup, not an immediate competitor; ALB down 25% from highs, may face future competition.

$165.7 -1.60%

Most original take

Sanne Wass, Christian Wienberg · Bloomberg Markets · 4 Jun 2026

Denmark to Study Whether Wegovy Can Get More People Working

Denmark is exploring whether Wegovy can boost workforce participation, adding a labor-market dimension to the GLP-1 story. The study could legitimize weight-loss drugs as macroeconomic tools and unlock new demand for Novo Nordisk beyond health.

Read original ↗

Our view

Today’s signals paint a picture of rotation from growth/tech into hard assets, underscored by Larry McDonald’s call and a tech warning last seen in 2020. But it’s not a clean shift: crypto is bleeding, Indonesia’s export plan is stoking EM stress, and South Korea faces rate hike fears. The common thread? Risk appetite is fracturing, with capital seeking tangible assets and defensive positions. XLK sits just 3% off its 52-week high, while GLD languishes 19% below its high — the rotation trade has room if momentum builds.

The counterargument: tech may be crowded, but the rotation call is one strategist’s view, and TLT at its 52-week low (only 3% above the trough) signals that a reversal in rates could violently unwind crowded short-duration trades. If the Fed hints at a pause, the entire hard-asset rotation narrative flips. Meanwhile, crypto’s ETF outflows are stark but may reflect profit-taking after a monster year, not a structural exit.

What’s missing: any central bank catalyst. This rotation talk is occurring in a policy vacuum — no Fed speeches, no rate decisions this week. That means the moves are speculative and fragile. Watch for any hint of a dovish turn; it would upend the TLT short and the hard-asset long in one session.

Second-order trade: dispersion is widening. Tech may stall, but not everything is falling — EEM is flat YTD, while EWY is up 108%. The cleanest expression may be long broad hard assets via DBC and short overbought tech via XLK, but size carefully.

Yesterday's signals, today

From the London Edition on 4 Jun 2026 — 1/1 signals moved in the predicted direction.

Today's scan: 219 articles considered · 14 surfaced · across 13 publishers

Generated Fri 5 Jun 2026 6:38am London · 5,245 views

Bloomberg Markets · CNBC Investing · CNBC Markets · CoinDesk · FT Alphaville · FT Companies · FT Lex · FT Markets · MarketWatch Top · Nikkei Asia · SCMP Business · The Information · WSJ Business · WSJ Markets

Next edition: New York Edition at 09:00 New York today.

Methodology
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