AI’s Relentless March: Why the S&P 500’s Bull Case Survives Tech’s Latest Shakeout

If you’re waiting for the S&P 500 to finally blink, you might want to get comfortable. Despite a global tech wobble that sent Asian equities into a tailspin and had the usual “AI bubble” Cassandras crawling out of the woodwork, the US equity juggernaut barely flinched. The S&P 500’s rally, according to the chorus of strategists and Seeking Alpha’s latest mid-year outlook, remains “fundamentally well supported.” In 2026, that phrase is as much a warning as it is reassurance.

Let’s get the facts straight. As of June 24, 2026, the S&P 500 is still riding high, with $SPY holding near all-time highs despite a two-day tech sector swoon. Market multiples are steady, AI-driven margin expansion is still the party trick, and even the Iran war couldn’t break the index’s stride. The 30-year Treasury yield is sitting at 5.2%, CPI is up to 4.2% year-over-year, and yet the equity market’s pulse is steady, if not a little too steady. Treasury Secretary Bessent is out there promising 3% GDP growth before year-end, and the only thing that seems to rattle the market is the possibility that AI’s magic might run out. But for now, AI is still the story, and the market is buying it, literally and figuratively.

The S&P 500’s resilience is not just about AI, though. There’s a sector rotation under the surface: as tech stumbles, money is quietly moving into healthcare, consumer staples, and real estate. The narrative is shifting from “AI or bust” to “AI plus everything else that isn’t wildly overvalued.” The market is pricing in an AI-powered productivity renaissance, but it’s hedging its bets with defensive plays. That’s not exactly the stuff bubbles are made of. If anything, it’s a sign that the market is maturing, at least by 2026 standards, which is to say, it’s still a little bit unhinged.

Historically, when the S&P 500 shrugs off geopolitical shocks and inflation spikes, it’s a sign of deep underlying strength, or deep denial. Remember 2017, when every headline screamed “imminent correction” and the index just kept grinding higher? This feels eerily similar, except now we have AI as the narrative glue. The difference is that today’s market is more data-driven, more algorithmic, and more prone to sudden, violent rotations. The fact that the S&P 500’s rally has survived a tech correction, a bond market tantrum, and a war in the Middle East should tell you something about the depth of the bid.

But let’s not kid ourselves. There are cracks. The yield curve is still weird, inflation is sticky, and the Fed is lurking in the background. The real risk isn’t that the AI bubble bursts overnight, it’s that the market’s faith in perpetual margin expansion gets tested by old-school macro shocks. If Treasury yields keep climbing, or if corporate earnings start to wobble, the whole “AI will save us” thesis gets a lot harder to defend.

Strykr Watch

The technicals are almost boring in their clarity. $SPY is hugging resistance near all-time highs, with support at $585 and a psychological floor at $580. The RSI is elevated but not extreme, call it 65 on the daily. The 50-day moving average is rising, and breadth is improving as money rotates out of tech and into defensives. If you’re looking for a breakdown, you need to see a close below $580. Until then, the path of least resistance is still up, with a breakout above the recent highs targeting $600 and beyond. Volume is steady, not euphoric. That’s a green light for the bulls, but with a finger hovering over the sell button.

The bear case? If the S&P 500 loses $585, the next stop is $580, and then things get interesting. Watch for volatility to spike if the index can’t hold those levels. The VIX is subdued, but that can change in a heartbeat. Keep an eye on sector leadership, if defensives start to roll over, that’s your early warning signal.

There’s always a risk that the market is underestimating something, be it inflation, geopolitical risk, or just plain old exhaustion. But for now, the technicals are telling you to stay long, with tight stops and a willingness to flip short if the tape turns ugly.

The opportunity here is to ride the trend, but don’t get greedy. Buy dips to $585 with stops at $580. If you’re feeling aggressive, play for a breakout above all-time highs with a target at $600. Just remember: the market giveth, and the market taketh away, usually when you least expect it.

Strykr Take

The S&P 500’s rally is a testament to the market’s ability to believe six impossible things before breakfast. AI is still the narrative, but the real story is the market’s resilience in the face of every conceivable shock. Stay long, stay nimble, and don’t fight the tape, at least not until the data tells you to. The bull case is alive and well, but the exit door is always closer than it looks.

datePublished: 2026-06-24