Big Tech Woes Power Surge in Inverse Single-Stock ETFs

Market Overview - The S&P 500 has experienced its longest losing streak of 2025, dropping for five consecutive trading days, marking the first such decline this year [1] - The index declined 1.5% over the past five sessions, driven by selling in major tech stocks due to concerns over an AI bubble and overvaluation [2] Economic Indicators - The likelihood of a Federal Reserve rate cut in September has decreased, with the CME Group's FedWatch Tool indicating a 73.6% chance of a quarter-point reduction, down from 92.1% a week prior [3] Inverse ETFs Performance - The market sell-off has led to a rally in inverse single-stock ETFs, which are designed to deliver the opposite daily return of specific stocks [3] - Several inverse single-stock ETFs have shown significant gains over the past week, including: - Defiance Daily Target 2X Short PLTR ETF (PLTZ) – Up 30.6% [5] - Defiance Daily Target 2X Short MSTR ETF (SMST) – Up 25.1% [6] - Defiance Daily Target 2X Short IONQ ETF (IONZ) – Up 19.4% [7] - GraniteShares 2x Short COIN Daily ETF (CONI) – Up 16% [8] - Defiance Daily Target 2X Short SMCI ETF (SMCZ) – Up 15.7% [9] Company Earnings Impact - Disappointing earnings reports from major retailers like Target and Walmart have contributed to the market downturn [2]