Tech Closes H1 at Records. Here's What Sets Up Q3

Wall Street's loudest desk just whispered a name that's already doubled. Want it?

June 30, 2026

The Dow just closed above 52,000 for the first time. The Nasdaq sits at 25,820, up more than 27% on the year.

Q3 starts tomorrow with a packed earnings calendar, fresh AI capex commitments, and a cybersecurity M&A wave most subscribers haven't priced in. Here's the setup I'm watching.

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Markets

H1 Wrapped at the Highs, and the Engine Is Still Tech

Tech led everything in the first half. The S&P 500 Information Technology sector rallied roughly 50% off its March 30 low, trouncing every other group.

The market closed June 29 at fresh records, with the Iran-Israel ceasefire holding and the Dow notching a record close.

From my seat, the move makes sense on paper. AI capex commitments keep growing. Alphabet flagged an $80 billion raise for AI infrastructure. Comcast announced a media spinoff. Salesforce kept buying smaller AI players. Demand is real.

The risk is what comes next. The Tech sector now trades at a premium to its own 10-year average, and the VIX at 17.62 tells you complacency is high.

That gap between price and earnings has to close one of two ways. Q2 numbers come in strong enough to justify multiples, or multiples re-rate lower.

The setup for Q3 is binary. Big-cap tech earnings start landing in mid-July. The first prints will set the tone for the whole half. If margins hold and AI revenue keeps accelerating, the rally has room. If not, the air comes out fast.

Cybersecurity Tech

The Cybersecurity M&A Wave Is Just Getting Started

May saw 26 cybersecurity M&A deals announced, per SecurityWeek's monthly roundup. That's a record clip. June kept the pace going.

The biggest tell: Akamai agreed to acquire LayerX for roughly $205 million, an enterprise browser security play closing in Q3.

Infoblox closed its Axur acquisition for AI-powered threat discovery. SecurityScorecard bought Driftnet. Torq picked up Jit. Every one of these deals is a strategic build, not financial engineering.

Why this matters for your portfolio: the bigger platforms are paying up to add AI-native capabilities they can't build fast enough internally. That's a structural signal.

The acquirers are telling you the next leg of cyber spending is about AI workflow security, browser security, and agentic SOC operations.

If you're hunting for setups, the smaller pure-play targets in those niches are getting bid. Multiples on the survivors will follow. Action: Don't fade cybersecurity here.

The consolidation cycle has another 12 to 18 months to run, and the platform names benefit either way.

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Corporate Earnings

Earnings Season Is About to Test the AI Premium

Big tech earnings kick off in mid-July. Expectations are sky-high after a 50% sector rally. The bar has rarely been this elevated heading into a print.

The most-watched setups: AI infrastructure spend has to keep accelerating, cloud growth has to re-accelerate, and gross margins need to hold despite the GPU price wars. Anything less than full beats on all three legs and the multiple compresses fast.

The forward calendar is dense. Beyond the mega-caps, mid-cap semiconductor names report through late July and early August. Software earnings concentrate in August. Cybersecurity prints stretch into September.

What I'd do here: don't chase the names that already moved 60% this year.

The risk-reward is upside-down. Instead, look at the mid-cap names where estimates have been revised higher but the stock hasn't fully responded yet. That's where the asymmetric setups live going into Q3 reports.

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Recent Tech Movers

MKS Inc. (NASDAQ: MKSI)

Up roughly 145% year-to-date as BofA names it their top SMID-cap pick for the second half. MKS is a semiconductor sub-systems supplier exposed to the wafer fabrication equipment buildout.

Bank of America's Jill Carey Hall just named it her top 2H26 SMID-cap idea, citing the surge in WFE capacity expansions and tech upgrades through 2028 tied to multi-year AI infrastructure demand.

The kicker is that MKS sells into every major foundry expansion. Every TSMC, Samsung, and Intel fab build flows through their order book.

Action: The 145% YTD move is real, but the BofA upgrade signals institutional money still building positions. If you want exposure, scale in on pullbacks rather than chasing.

Risk: After a 145% run, any disappointment on the next print could trigger a sharp pullback. Sizing matters more than entry timing here.

ON Semiconductor (NASDAQ: ON)

Chip stocks rebounded into Q2's close as the Iran ceasefire took risk off the table. ON has lagged the broader semi rally because of its auto and industrial exposure during a soft cycle. There are signs that's turning.

Inventory destocking is mostly finished, EV silicon carbide demand is stabilizing, and the industrial automation order book has firmed up. The next earnings report is the catalyst.

If management signals trough is in, the stock has room to re-rate higher off depressed multiples. 

Action: Build a starter position ahead of the late-July earnings report. The setup favors patient buyers, not chasers.

Risk: If the auto cycle takes another leg down or EV demand falters again, ON has more downside than peers tied to AI.

HubSpot (NYSE: HUBS)

SaaS names are catching a bid as AI productivity stories finally translate into seat expansion. HubSpot's AI-native CRM push is showing up in net revenue retention and pricing power.

The Breeze AI agents launched last year are now driving real upsell, and management's guidance for the back half of 2026 looks conservative versus what the field reports are suggesting.

Earnings land in early August. Estimate revisions have been creeping up for six straight weeks.

Action: This is a forward-looking play on the next print. Position before estimates catch up to reality.

Risk: SMB customer churn could spike if the economy softens, since HubSpot's core market is smaller businesses that tighten budgets first.

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The Speculative Pick This Week

GitLab (NASDAQ: GTLB) is the DevSecOps platform that competes head-on with Microsoft's GitHub, except they ship one integrated stack instead of bolt-ons.

The story for 2H26 is GitLab Duo, their AI coding assistant, which is now landing real enterprise wins. 

The AI Coding Tailwind

Every Fortune 500 CIO has a generative AI coding mandate. GitLab Duo's pitch is data-sovereign, on-prem capable, and integrated with the existing GitLab workflow.

That's a hard sell for any rival to match in regulated industries. Banks, defense contractors, and healthcare players are signing multi-year deals because they can't ship code to a third-party cloud.

Setup Into the Next Print

Fiscal Q2 earnings land in early September. Estimate revisions have moved upward over the last 60 days. Net revenue retention is the metric to watch.

If Duo seat expansion shows up cleanly in the next report, this re-rates. The chart shows a healthy base under recent levels. 

Action: This is a forward-looking AI software play with a real product, a real catalyst on the calendar, and a stock that hasn't fully responded to the estimate revisions.

Build a position ahead of the September fiscal Q2 earnings report.

Risk: Competition from GitHub Copilot is fierce, and Microsoft can bundle aggressively. If GitLab's seat growth slows even slightly, the multiple compresses fast.

Everything Else

  • 🚀 A free report names the 10 stocks most likely to lead the next rally once the Fed starts cutting rates.

  • 🤖 Oil settles up on US-Iran strikes; cautious hopes for shipping cap gains.

  • 📱 Stocks and oil prices rise with eyes on Iran; yen touches 40-year low vs dollar.

  • 🔒 Iran war developments, Fed rate path cues in focus for Indian rupee and bonds.

  • 💾 Philippines leads the world in rush to solar as power prices soar.

That's our coverage for today; thanks for reading! Reply to this email with feedback or any tech stocks you want me to check out.

Best Regards,
—Noah Zelvis
Tech Stock Insider