An American Opportunity
This bull market won't budge... A July 4 gift... Trump's pipeline push helps a forgotten energy boom... 200 trillion cubic feet of fuel – and one way to profit... How to navigate this 'risk on' market...
Stocks are headed into the Fourth of July on a high...
For the second straight day – and fourth trading day in the past five – the benchmark S&P 500 Index and tech-heavy Nasdaq Composite Index closed at new all-time highs. The Dow Jones Industrial Average is nearing a new record as well, and even the small-cap Russell 2000 Index has been pushing higher.
The major U.S. stock indexes opened higher and stayed that way after June's "nonfarm payrolls" report published this morning. It showed the unemployment rate falling to 4.1% and 147,000 new jobs, both beating Wall Street expectations.
The Nasdaq and Russell 2000 finished 1% higher today, and the S&P 500 and Dow gained just under 1% for the day.
Meanwhile, the CBOE Volatility Index ("VIX") is at less than 17, showing a lack of "fear"... and bitcoin traded above $110,000 earlier today in a decidedly "risk on" move.
There's no slowing the market down yet...
Today's performance came even with a decent chunk of traders lowering their expectations for Federal Reserve rate cuts in the second half of the year.
The CME Group's FedWatch Tool shows federal-funds futures traders have shifted from pricing in three cuts during the rest of the year to now only two. Shorter-term expectations for cuts at the next two Fed meetings were also tempered.
Whether these expectations will turn out to be "right" or "wrong" is immaterial, at least when gauging the direction of the market today. But it could be another bullish tell.
You see, in a less enthusiastic market environment, the interest-rate shift may have pushed stocks down.
Mr. Market typically doesn't respond as well to the idea of higher interest rates when they could be lower. But today's stronger-than-anticipated jobs numbers were received just as well at the thought of "easier" monetary policy.
That may indicate that "good" economic news will continue to be rewarded in the stock market, even if it means lower or delayed expectations for rate cuts at some point in the future.
In short, it could take something much bigger than tempered expectations for interest-rate cuts... another $5 trillion in debt being added to Uncle Sam's liabilities... questions around trade deals... or everything else we've seen this year to knock this bull market off its recent course of hitting new highs.
The path forward...
As we've been saying, this doesn't mean it's time to go "all in"... or "all out" on stocks (if you're concerned about the giddy market sentiment right now). Rather, as we quoted Stansberry's Investment Advisory lead editor Whitney Tilson as saying on Monday, "sit tight."
By all means, enjoy the good times. The market is acting healthier and calmer this Independence Day than it was after "Liberation Day" just a few months ago. But it's important to know what kind of environment we're in right now. Greed is back, rather than the panic we saw a few months ago.
So as we wrote on Monday, "be picky." Make sure your buying decisions align with your long-term goals. And as Dan Ferris wrote last Friday, you need to be "truly diversified." In his essay, he detailed what he and our colleague, Stansberry Research senior analyst Alan Gula, mean by that... along with naming five specific assets to own to protect your portfolio today.
Sentiment comes and goes, but certain fundamentals and tailwinds will remain in various environments. As we head into the holiday weekend, here is another example of one of them...
Unlocking America's energy...
When President Donald Trump entered office in January, he immediately signed a flurry of executive orders to support the U.S. energy sector.
Put simply, he wanted to remove regulations that "impose an undue burden" on U.S. energy exploration and production. (You can find the entire executive order signed on his first day in office here.)
Those resources include oil, natural gas, coal, and even nuclear energy. In past Digests, we've spent a lot of time covering the recent boom in nuclear power thanks to artificial intelligence and data centers.
But that demand will help all energy sources – not just nuclear.
Now, we're getting an idea of how decreased regulation is helping natural gas companies build out necessary infrastructure.
In an interview with global news service Reuters, a spokesperson for natural gas giant EQT (EQT) said that the company is "actively" looking into ways to build out more infrastructure. And several other companies – like energy pipeline owner Williams (WMB) – are doing the same, Reuters said.
Specifically, they're looking at building out infrastructure and pipelines in the northeast U.S. – home to the Marcellus and Utica shale formations. And there's a clear reason why this region is in focus...
There's plenty of supply...
The northeast U.S. has plenty of natural gas in the ground. As Whitney and the Stansberry's Investment Advisory team explained in the February issue...
The Appalachian Basin is the cornerstone of U.S. natural gas production. Comprising the Marcellus and the Utica shale formations, it generates nearly one-third of the nation's total output.
The Appalachian Basin – which runs from New York down to parts of Tennessee and Alabama – is estimated to have 200 trillion cubic feet of natural gas in its formations, according to Whitney. For comparison, the U.S. consumed about 32 trillion cubic feet of natural gas in 2023.
So the estimated reserves in just this area could power the entire country for roughly six years.
Yet, output in the region has stalled. Just take a look at this chart Whitney shared...
Production grew 6X between 2012 and 2021, from about 5 billion cubic feet per day to more than 30 billion cubic feet per day. But since, production has grown less than 10% in four years.
It's all about pipelines...
With that much natural gas ready to be pulled out of the ground, companies need the infrastructure in place to move the fuel to other parts of the country. That includes domestic consumption and exports to other countries.
As Whitney wrote...
As you can see in the chart below using data from the Energy Information Administration ("EIA"), the U.S. added a lot less pipeline capacity in 2022 and 2023 than any of the previous five years.
On a percentage basis, pipeline capacity growth averaged about 2% per year between 2020 and 2024. That's well below the average of 15% in the previous five-year period, according to the EIA's data.
Currently, there's only one new pipeline set to be built in the northeast, and it's for just two miles between Pennsylvania and New Jersey.
But that's all set to change under the Trump administration. Companies are planning to build out infrastructure and boost capacity. So we expect a lot more pipeline projects to get underway in the coming months and years.
The Stansberry's Investment Advisory team saw this opportunity back in early February. And their recommendation from that month is already up 12%. That return easily beats both the broader market's return of about 3% (as measured by the S&P 500) and the Energy Select Sector SPDR Fund (XLE), which is down almost 2% in the same time span.
Today, the stock is a fraction above the team's recommended buy-up-to price, but a slight dip below would present a good buying opportunity.
Paid-up subscribers and Alliance members can read the full report here, and if you're interested in getting access to our flagship newsletter, you can find more information about getting started here.
The Investment Advisory model portfolio includes more than a dozen holdings in buy range right now, including a brand-new recommendation in the cybersecurity sector that the team published just yesterday.
And with that, we're off for the long weekend. We hope you enjoy it. Our offices and the markets are closed tomorrow. Stay tuned for our Masters Series essays this weekend, and we'll pick back up with our regular fare on Monday.
New 52-week highs (as of 7/2/25): Valterra Platinum (ANGPY), Atour Lifestyle (ATAT), Dimensional International Small Cap Value Fund (DISV), iShares MSCI Emerging Markets ex China Fund (EMXC), iShares MSCI Spain Fund (EWP), Cambria Emerging Shareholder Yield Fund (EYLD), Cambria Foreign Shareholder Yield Fund (FYLD), Honeywell International (HON), JPMorgan Chase (JPM), Newmont (NEM), Novartis (NVS), Ryder System (R), Telefônica Brasil (VIV), Vanguard S&P 500 Fund (VOO), and Industrial Select Sector SPDR Fund (XLI).
In today's mailbag, feedback on yesterday's edition, which shared how small-business owners in one niche industry are dealing with tariff costs... and thoughts on the Trump versus Jerome Powell saga... Do you have a comment or question? As always, e-mail us at feedback@stansberryresearch.com.
"I suspect that what's going on with Mr. Keeley and Mr. Cusack is a microcosm of what we can expect to see with many small businesses, and it ain't pretty..." – Subscriber Sherwin R.
"Jerome Powell, arch enemy to Donald Trump. Drop the interest rates or you're fired! Why in hell did our government turn the nation's money supply over to a private bank called the Federal Reserve?... Trump, don't fire Jerome Powell. Replace the Federal Reserve with a constitutional U.S. Government run bank. Put Ron Paul in charge of it." – Subscriber Mark M.
All the best,
Corey McLaughlin and Nick Koziol
Baltimore, Maryland
July 3, 2025