What We Learned This Week

Meme Stocks are Stirring Again: We’re starting to see shades of the meme stock frenzy creeping back into the markets. This is reminiscent of the post-pandemic surge in speculative retail trading we saw around 2021–2022, when names like GameStop and AMC became battlegrounds for short squeezes that caught Wall Street off guard. Back then, retail traders, flush with cash and looking for action, turned the stock market into a kind of high-stakes game - pumping up troubled companies and forcing hedge funds to scramble as prices soared well beyond fundamentals. Eventually, reality caught up, strategies unraveled, and much of that crowd disappeared as markets corrected.

Now, with the market at all-time highs and risk appetite back, we’re seeing some of that speculative behavior resurface. This past week, stocks like Kohl’s, Krispy Kreme, GoPro, and Opendoor have seen wild swings of 50% or more in a single day, triggering multiple trading halts. While this isn’t a cause for panic, it’s a signal worth watching. Sharp, sentiment-driven rallies like these often point to froth in the system, where prices can quickly disconnect from business fundamentals. It doesn’t mean a market collapse is imminent, but it does suggest a more cautious stance might be warranted as complacency creeps back in.

Amazon’s Prime Day sets records: We’re starting to get a clearer picture of Amazon’s latest big sales event - Prime Day 2025. At this point, the name is a bit misleading, as the event stretched across four days, double the length of last year’s. That makes year-over-year comparisons tricky, but what we do know is impressive: Amazon sold a record number of items over this period, surpassing any previous four-day stretch in the company’s history. In fact, the total volume appears to have matched roughly two Black Friday 2024 events combined.

In terms of performance relative to expectations, the event seems to have landed right on target - not a blowout, but certainly no disappointment. Beyond the headline numbers, the broader takeaway is how Amazon continues to manufacture its own retail “holiday” during what is typically the slowest period of the year. By doing so, they smooth out sales patterns and keep customers engaged year-round. More importantly, this year’s results offer a healthy read on consumer behavior. Despite all the noise about a weakening consumer, people are still spending when the value proposition is strong. That’s a positive sign both for Amazon and for the broader retail landscape.

Homebuilder Stocks are Rallying: Shares of national homebuilders D.R. Horton and PulteGroup surged this week following earnings reports, driven not just by solid headline sales but by a stronger-than-expected margin performance that caught investors’ attention. The results suggest a potential bottoming out of the margin pressure that’s weighed on the sector, though it’s unclear if this marks the start of a sustained recovery. These stocks have been under significant pressure for the past few years as affordability has deteriorated, interest rates have stayed elevated, and both buyers and sellers have remained cautious.

For the big builders, the challenge has been navigating weak demand at the higher end of the market while still tapping into entry-level buyers, often requiring price adjustments that hurt margins. Investors have been wary, unable to gauge how long these headwinds would last. The recent stabilization is a positive sign, but both companies still highlighted ongoing demand challenges despite some relief from slightly lower mortgage rates. The reality is that affordability remains a major hurdle. Even if rates fall further, rising home prices could offset much of the benefit, keeping homeownership expensive and extending the trend of people renting for longer than in the past.