The Dividend Cafe - Wednesday - May 6, 2026

Episode Date: May 6, 2026

Brian Szytel reports a strong market follow-through day, with the Dow up 612 points, the S&P 500 up 1.5%, and the Nasdaq up 2%, driven largely by a ~7% drop in WTI oil on positive Iran deal developments, which also pushed the 10-year yield down 7 bps to about 4.35%. Earnings season is going better than expected with positive CapEx/AI themes, dividend increases, and upbeat guidance; private credit results have also beaten expectations despite negative media narratives. He notes the market’s year-to-date gains (Dow ~4.25%, S&P ~8%, Nasdaq ~11%+) and observes that only about half of S&P names are above the 200-day moving average, though semiconductors look frothy and expensive. He highlights ADP private payrolls of 109,000 vs. 99,000 expected and wage growth of 4.4% for job stayers and 6.6% for job changers. He explains that prices still move when U.S. exchanges are closed due to global listings and near 24-hour futures trading. 00:00 Market Rally Recap 00:49 Earnings Season Strength 01:42 Valuations And Internals 02:16 Semis Froth Check 03:01 Oil And Macro Risks 03:20 ADP Jobs And Wages 03:57 Why Markets Move After Hours 05:10 Wrap Up And Sign Off Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com

Welcome to the Dividing Cafe weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. Good evening and welcome back into Dividend Cafe. This is Brian Saitel back with you. Here's your host this evening from our Newport Beach, California office here at the Bonson Group. On a follow-through day in markets, we had an update yesterday and we've got a pretty robust follow-through here today. The Dow was up 612 points. S&P was up a percent and a half. NASDAQ was up a stunning 2% on the day.

So big up move, mostly predicated on a decrease in oil prices. So WTI was down about 7%. And you can guess the reason as to why there's positive development in a deal happening in Iran. And that's moved oil lower. It moved bond yields lower. 10-year yield was down seven basis points. We got down to 435. on tens. So markets are feeling better. We're in the middle of earnings season, and we wrote about this

yesterday, but with two-thirds having reported at this point, obviously it's going better than expected, and everything from CAPEX and AI to most other sectors, things are going quite well. Even the private credit names, individual stocks that have reported have really beaten largely expectations around a sector that the media, I think, is broken, and the lenders and the borrowers no, isn't. So that's what's going on a private credit, which is that there isn't anything unusual really going on under the hood there. But when I looked under the hood of the stock market, we've seen this meltup now in markets. The Dow is up maybe four or so, four and a quarter percent on the year. S&P is up almost eight. Nasdaq's up about 11 and a half, about 11 and a quarter on the year.

Or this is May 6th, so we're not even halfway through the year. Stocks are up. If you peel back the onion a little bit and just look at are things overvalued? You can look at PE ratios, but there's some technical tools that we can look at too. We don't tend to spend a lot of time using these things, but just the 200-day moving average in the amount that you're above it can be indicative here of how far this thing has run in a short period of time. Right now, there's only about half the names in the S&P that are even above it at all. We usually see blowoff tops, it's like all of them are 100%, 90%, 80%, something like that. Some of the internals look good, but not too crazy. Now, if you look at some of the sectors and you want to throw the semis in there,

for example, and I wrote about this last week, I think there's some profit in there just because these names are not only all above their 200-day moving average, but they're above it by 50%. So that's a huge number, but not just that. That's just a technical term. But if you look at the fundamentals, they're just hyper-expensive at this point. They've all had huge gains on the or 50, 60, 100% gains. Big move in the semis. Other than that, I think there's something to be said about just the quality of earnings that you're saying.

And really, they've risen to the occasion of supporting these valuations, which were deemed to have been priced to perfection. But you're getting dividend increases from most of our names. You're getting revisions going forward and positive guidance and all that positive stuff. Now, if you were to take out the bad things in the market, namely high oil and what's going on in the Middle East, then all the only. all else equal, then you can see why the market is melting up. Of course, these pendulum swing, and that's not to say that won't end and frankly can end any day, but that's what I'm saying on

my screen at least for now. We do have, there was a private payroll number out today that was better than expected by a decent margin. There was a 109,000 new job print for ADP private payroll for April. The consensus was only for 99. And if you looked inside of the wage growth numbers inside of those private pay rolls. For people that kept their job, it was up 4.4. And for those who moved to a new job, it was up 6.6. If you think of inflation being somewhere in the two and a half to three, and wage growth being somewhere between four and a half and six and a half, then you have to think real wage gains are a positive thing for the economy as well. And that was my point to saying that. The question in there today was about just some clarity around when we say markets are closed,

but then they're still moving and we're talking about them being up before they're opened and them being up or down when they're closed. How does that work if they're closed, right? And so I think it's an intuitive question and the way it was framed was good. But the reality is the U.S. market being closed is just talking about our exchanges being closed here. U.S. companies are often listed around the world and other exchanges, developed market exchanges in Europe and Asia.

And so you can see those stocks trading. And then you've got futures trade, not quite 24 hours a day, but maybe 23. most days of the week. And so you can see prices being set. Those are just contracts that are indicative of a value or a price to buy or sell a security at a given set amount. And so those things trade real time. Markets in Europe and Asia, they're going to be open when hours are closed and all of those things trade real time. So the world keeps spinning and everything's priced in real time all the time just because you can't sell or buy something on the New York Stock Exchange when it's not open doesn't mean that the price hasn't changed. Of course it has. It changes every minute and every second. second of every hour of every day. So that's how that works. Any more questions on that or anything else? Please reach out, as always. And again, I'll let you go here for this evening. I'll be back with you tomorrow on Dividend Cafe. Thank you again. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, member FINRA and SIPC, and with Hightower Advisors, LLC, a registered investment advisor with the SEC. Securities are offered through

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