The question dominating CNBC’s Squawk on the Street on June 24, 2026: is the plumbing of leveraged single-stock ETFs now driving price action, rather than fundamentals? Host Carl Quintanilla led a discussion with David Faber, Leslie Picker, and Cantor Fitzgerald’s CJ Muse that put market structure at the center of this week’s tech sell-off, ahead of the AI demand story.
The Structural Thesis: A Thin-Float IPO Meets a Wall of Leverage
The case study is SpaceX (NASDAQ:SPCX). Faber argued that leveraged ETFs are a structural phenomenon that can limit liquidity, and when they rebalance toward the close they create outsized moves in both directions. He noted roughly 11 leveraged or derivative ETFs launched right after SpaceX went public with only a 4% float, layering forced daily rebalancing on top of already-limited tradable supply.
SpaceX-linked products include the GraniteShares 2x Long SpaceX Daily ETF (CBOE:SPAL), along with additional 2x short, ProShares Ultra, Defiance Daily Target 2x Long SPCX ETF (SPCU), and Kurv Enhanced Income variants. SPAL carries a 1.5% gross and net expense ratio per its June 12, 2026 prospectus (see the SEC filing).
The price action backs up the mechanics. SPCX fell 22.64% over the week ending June 23, from $201.80 to $156.11, after clearing $200 days earlier. SPAL, the 2x long product, dropped 42.51% over the same stretch, from $37.78 to $21.72. That gap between a 2x daily ETF and its underlying is the daily-reset compounding decay Faber described.
Why It Spills Into Mega-Cap Tech
Picker observed that volatility is now happening “at scale.” Unlike the meme-stock era, which was largely small caps, semiconductor shares now sit at a record roughly 19% of the S&P 500, about double the level from 2000. Daily swings in a handful of names move the index.
That concentration shows up directly in the SPDR S&P 500 ETF (NYSEARCA:SPY), where NVIDIA alone carries a 7.58% weight as of the March 17, 2026 fact sheet. SPY fell 2.23% over the week ending June 23, with a 1.62% one-month decline. NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) slid 6.99% over the past month to $200.04. The VIX closed at 19.49 on June 23, up 18.8% week-over-week from 16.41, ranking in the 77.1 percentile of its 12-month range. Stress is broad-based across the market.
The Counterweight: Demand Still Looks Tight
Muse pushed back on a fundamentals-broken read. He argued a rising tide for compute demand will lift all boats so long as capacity stays tight, with memory supply tightening further into 2027 and TSMC wafer allocation prioritizing NVIDIA, AMD, and Broadcom. His Micron bull case targets roughly $200 of earnings for next calendar year, implying about a 5x multiple, framed explicitly as his projection.
The recent prints support the demand backdrop. Shares of Micron (NASDAQ:MU) have rallied 268.68% year-to-date to $1,051.77 as of June 23. Micron’s Q2 FY2026 revenue hit $23.86B, up 196.3% YoY, with non-GAAP EPS of $12.20 beating $8.73. NVIDIA’s Q1 FY2027 delivered $81.61B in revenue, up 85.2%, with Data Center up 92% YoY.
Micron reports tonight. Its earnings have quickly become what NVIDIA’s used to be in 2024, the “bellweather” report that shapes whether the market as a whole rises or falls in the weeks to come.
What to Watch Next
Leveraged single-stock ETFs anchored to a 4% float can amplify swings into the close, and with semis at a record S&P 500 weighting, that amplification leaks into NVIDIA, Micron, and the index itself.
Whether this is the root cause or one accelerant alongside positioning resets, the feedback loop persists until either the float expands or rebalancing mechanics change. Underlying compute demand, as Muse framed it, is a separate question, and so far the earnings line still points up. The next big test will come tonight when Micron reports. It will be a balancing act to satisfy sky-high investor demands, but with the stock up more than 700% across the past year, short-term volatility may win out even as the longer-term picture continues to look optimistic.
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