STRAIGHT FROM THE TRADING FLOOR
by Eric Criscuolo - Market Strategist
Published on 6/04/26 (a/o 2:00 pm)
DOW 51,484 (+796), S&P 500 7,591 (+37), Russell 2000 2,933 (+39), NYSE FANG+ 10,135 (-60), ICE Brent Crude $94.67/barrel (-$3.14), Gold $4,505/oz (+$38), Bitcoin ~63.1k (-2613)
- S&P strengthens throughout the day like Knicks last night
- Tech down but off lows; breadth strong like KAT in the paint
- Crude, rates lower
- Bitcoin continues to slide
- Check out some of the recent ICE Data/Content:
- Inside the ICE House
- Episode 537: Fundrise CEO Ben Miller on Democratizing Private Markets, AI, and VC Investing
- ETF Central: FLX Networks Founder and CEO Brian Moran
- NYSE Research Insights: Behind the Record Volumes: A Hidden Opportunity
- ICE Mortgage Monitor: Delinquencies Hold Steady in April
- Market Story Lines
MAC Desk Commentary:
The S&P’s daily winning streak ended at nine yesterday but fortunately that didn’t stop the Knicks from extending theirs to 12 last night in Game 1 of the NBA Finals. Tech weakness weighed on the market with software pulling back amidst a longer-term 2-month recovery and mega caps mostly lower. Crude and yields rose, providing a headwind for equities overall and driving small caps to underperform (Russell -1.3%, S&P -0.7%).
There were a few Middle East headlines overnight, which skewed positive. Among the most impactful: a ceasefire in Lebanon and President Trump saying the US will resume full hostilities against Iran only if US troops are killed in the region, as well as saying the US is in “final negotiations” to end the conflict. Those headlines helped push oil and yields lower. Despite those tailwinds the S&P 500 opened down 0.5% as tech continued to come under pressure. The other major indexes, however, capitalized on the oil/yield move as the Dow, Russell 2000 and S&P 500 equal-weight opened flat (R2K) to higher.
The S&P 500 has rallied steadily since the weaker open and is now up ~0.5%, for a +1% reversal and drawing neck-and-neck with the equal-weight. Tech has cut into its opening losses with AI-leveraged names (i.e. AVGO, MU) well off initial lows while the defensive Staples pulled back. The Russell 2000 has also strengthened, up over 1%.
The ICE Semis index was down 3% but its now less than 1%. Cyber names are mostly higher outside of CRWD/PANW. While it didn’t send shockwaves across the market, it was still interesting to hear OpenAI CEO Sam Altman on Tuesday call attention to the growing scrutiny on AI token spending when he noted that it is “all of a sudden a huge issue”.
There’ some pivoting evident today, like Karl Anthony Towns in the paint last night and breadth is also strong, mirroring the ensemble-driven Knicks win. Financials and Healthcare- the two worst performing sectors YTD, are sharply higher and leading today. Financials are strong across-the-board and credit names are bouncing back from weakness yesterday (Cliffwater redemptions) despite more news of private credit funds limiting withdrawals (BCRED). Healthcare is also broadly stronger. An upgrade for UNH is helping managed care lead the way and trillion-dollar LLY is up 5%. Alphabet is bouncing after streak of weakness, lifting Comm Services.
We noted the weakness in Tech, though less so as we hit the afternoon. All other sectors are basically flat to higher. Thematic plays are mixed. Space and genomics names are trading well. Neocloud/HPC are lower. Quantum and rare earths are mixed to lower lower.
Labor market updates headlined the economic data this morning and while not alarming it wasn’t the strongest showing either. Weekly initial jobless claims rose from last week’s 215K to 225K and were above consensus. That’s the highest level since early February, but the period includes the Memorial Day holiday, which could have skewed things. Continuing claims, however, fell slightly from last week. Challenger Job Cuts rose to 97K, up from last month’s 83K. It was the highest May total since 2020- the teeth of the pandemic. Tech companies accounted for 38K of the 97K cuts, continuing to be the largest source of cuts, by far (Transportation was next, at 7K). From the report, “we’re seeing a sharp rise in cuts tied to acquisitions and mergers and a jump in bankruptcy-related losses, which tells me companies are restructuring aggressively as they reposition for an AI-driven economy.” Revised Productivity came in at 0.3% q.q, down from the initial 0.8% estimate. Unit labor costs were also revised down from 2.3% to 1.8%.
Despite the sluggish labor data, futures and rates didn’t react too much. Earnings generated much more impact, especially on the individual stock level:
- Broadcom was the big reporter overnight. The stock is down >10% with results good but not good enough. There’s some concern around Google diversifying its TPU partnerships beyond AVGO, as well as margin pressure from the TPU business. The stock was up ~40% YTD coming into the print.
- Cybersecurity provider CRWD is down ~5% (but has cut its loss in half). The company reported decent numbers overall but a few items disappointed and the stock came in to the print up ~50% YTD. Peer PANW is also down modestly today after falling 6% yesterday after its own earnings.
- Retailers are seeing divergent responses to results. The XRT ETF is around flat. PVH is down sharply however. Top and bottom beat but revenue guidance was lowered. Management called out greater macro impacts on the consumer in the EMEA region while the US consumer is holding up well.
- FIVE (-10%) despite a beat-and-raise. Management was cautious on the consumer going forward, especially in light of strong upcoming comps.
- TLYS is up >5% (off highs) on a top-and-bottom beat and above consensus guide.
Yields moved steadily lower overnight, following oil lower on the relatively positive Iran headlines. The Dollar is weaker as well. Treasuries have reversed much of yesterday’s move, down ~3bp across the curve. KC Fed President Schmid spoke this afternoon, saying the US economy is generally is solid shape but the biggest threat is inflation, making the key question how long should the Fed hold rates steady. SF President Daly also spoke and said policy is in a good place but the Fed is prepared to respond either way.
- US 2yr -4bps to 4.05%, 5yr -4bps to 4.18%, 10yr -3bps to 4.47%, 30yr -2bps to 4.98%
- USD index: -$0.16 to $99.35
Crude is lower on the geopolitical headlines, though natural gas is higher with a lower-than-expected inventory build. Brent is testing support at its 50d ma. Precious metals are gaining as rates and oil fall. The pressure on crypto continues with Bitcoin and ETH down another ~3%. Bitcoin took a run at $60K earlier today but is back around $63k and the Feb lows. High-flying alt-coins are also seeing downside after weeks of sharp moves for many. Ag commodities are lower as well following a drop in export sales data.
Major European indexes ended higher and near best levels. Healthcare was a leader, especially pharma (AZN, SAN, NOVN, GSK, NOVO +3-4%). Financials were higher as well. Like San Antonio, Germany is nursing a loss today after failing to win one of the rotating seats on the UN Security Council yesterday. The result is putting pressure on German Chancellor Merz. Over in Asia, Japan, Hong Kong and S. Korea fell over 1%, with tech weak (Softbank -11%, Samsung, SK Hynix down 2.5%). Ford has gained over 30% the past month, in large part on optimism around its new Energy subsidiary (battery storage) and Mitsubishi Motors and Nissan are looking to join the fun. Both announced plans to launch - several years from now- services that would allow EV owners to sell surplus power back to grid.
Earnings:
- After-Market (Thrs): AGX, CURV, DOCU, GWRE, IOT, LULU, NX, PL, RBRK, TTAN
- Pre-Market (Fri): ABM
Economic Data:
US:
- Challenger Job Cuts: 97.006K vs prior 83.387K
- Jobless Claims: 225K vs 213K cons, prior 215K
- Continuing claims: 1777K vs 1780K cons, prior 1786K
- Q1 Nonfarm Productivity q.q (final): 0.3% vs 0.8% preliminary
- Unit Labor Costs: 1.8% vs 2.3% preliminary
- EIA nat gas inventories: 95Bcf vs 101Bcf cons, prior 92Bcf
- 4:30pm Fed Balance Sheet
Global:
- Europe Retail Sales m.m (April): -0.4% vs -0.3% cons, prior 0.8% (revised up from -0.1%)
- Spain Industrial Production y.y (April): 2.0% vs 2.0% cons, prior 1.9%
STRAIGHT FROM THE TRADING FLOOR
by Eric Criscuolo - Market Strategist
Published on 6/04/26 (a/o 9:00 am)
Good morning,
The S&P’s daily winning streak ended at nine yesterday but fortunately that didn’t stop the Knicks from extending theirs to 12 last night in Game 1 of the NBA Finals. Tech weakness weighed on the market with software pulling back within its 2-month recovery and mega caps mostly lower. Crude and yields rose, providing a headwind for equities overall and driving small caps to underperform (Russell -1.3%, S&P -0.7%).
S&P futures are trading lower this morning despite a pullback in crude. There were a few Middle East headlines overnight, which skewed positive. Among the most impactful: a ceasefire in Lebanon and President Trump saying the US will resume full hostilities against Iran only if US troops are killed in the region, as well as saying the US is in “final negotiations” to end the conflict. In macro data, weekly initial jobless claims rose from last week’s 215K to 225K, and were above consensus. That’s the highest level since early February, but the period includes the Memorial Day holiday, which could have skewed things. Continuing claims, however, fell slightly from last week. Challenger Job Cuts rose to 97K, up from last month’s 83K. It was the highest May total since 2020- the teeth of the pandemic. Tech companies accounted for 38K of the 97K cuts, continuing to be the largest source of cuts, by far (Transportation was next, at 7K). From the report, “we’re seeing a sharp rise in cuts tied to acquisitions and mergers and a jump in bankruptcy-related losses, which tells me companies are restructuring aggressively as they reposition for an AI-driven economy.” Revised Productivity came in at 0.3% q.q, down from the initial 0.8% estimate. Unit labor costs were also revised down from 2.3% to 1.8%.
Despite the sluggish labor data, futures didn’t react too much and are trading within their overnight range. Earnings have been a drag with most reporters lower. For tech, Broadcom is down over 10% with results good but not good enough and concern around share loss for Alphabet’s TPU production. Cybersecurity provider CrowdStrike is down 10% as well. Retailers are getting his with PVH -25% and FIVE -10%, though TLYS is up 10%.
Yields moved steadily lower overnight, following oil lower on the relatively positive Iran headlines. The Dollar is weaker as well. Heading into the Open treasuries have essentially reversed yesterday’s move, down ~5b across the curve.
Crude is lower on the geopolitical headlines, though natural gas is higher. Brent is testing support at its 50d ma. Precious metals are gaining as rates and oil fall. Crypto continues to come under pressure with Bitcoin down 3% and falling back towards $60K, currently around Feb lows. High-flying alt-coins are also seeing weakness after weeks of sharp moves for many.
European indexes are mostly higher (FTSE 100 down slightly) and most near best levels. Financials and luxury are some of the leaders while tech and energy lag. Japan, Hong Kong and S. Korea fell over 1%, with tech weak (Softbank -11%, Samsung, SK Hynix down 2.5%).
Earnings:
After-Market: AI, AVGO, CHPT, CRWD, DSGX, FIVE, NTSK, PVH, TLYS, VEEV, WOOF
Pre-Market (Thrs): BF.B, CAL, CIEN, TTC
After-Market (Thrs): AGX, CURV, DOCU, GWRE, IOT, LULU, NX, PL, RBRK, TTAN
Economic Data:
US:
The S&P’s daily winning streak ended at nine yesterday but fortunately that didn’t stop the Knicks from extending theirs to 12 last night in Game 1 of the NBA Finals. Tech weakness weighed on the market with software pulling back within its 2-month recovery and mega caps mostly lower. Crude and yields rose, providing a headwind for equities overall and driving small caps to underperform (Russell -1.3%, S&P -0.7%).
S&P futures are trading lower this morning despite a pullback in crude. There were a few Middle East headlines overnight, which skewed positive. Among the most impactful: a ceasefire in Lebanon and President Trump saying the US will resume full hostilities against Iran only if US troops are killed in the region, as well as saying the US is in “final negotiations” to end the conflict. In macro data, weekly initial jobless claims rose from last week’s 215K to 225K, and were above consensus. That’s the highest level since early February, but the period includes the Memorial Day holiday, which could have skewed things. Continuing claims, however, fell slightly from last week. Challenger Job Cuts rose to 97K, up from last month’s 83K. It was the highest May total since 2020- the teeth of the pandemic. Tech companies accounted for 38K of the 97K cuts, continuing to be the largest source of cuts, by far (Transportation was next, at 7K). From the report, “we’re seeing a sharp rise in cuts tied to acquisitions and mergers and a jump in bankruptcy-related losses, which tells me companies are restructuring aggressively as they reposition for an AI-driven economy.” Revised Productivity came in at 0.3% q.q, down from the initial 0.8% estimate. Unit labor costs were also revised down from 2.3% to 1.8%.
Despite the sluggish labor data, futures didn’t react too much and are trading within their overnight range. Earnings have been a drag with most reporters lower. For tech, Broadcom is down over 10% with results good but not good enough and concern around share loss for Alphabet’s TPU production. Cybersecurity provider CrowdStrike is down 10% as well. Retailers are getting his with PVH -25% and FIVE -10%, though TLYS is up 10%.
Yields moved steadily lower overnight, following oil lower on the relatively positive Iran headlines. The Dollar is weaker as well. Heading into the Open treasuries have essentially reversed yesterday’s move, down ~5b across the curve.
- US 2yr -6bps to 4.03%, 5yr -6bps to 4.17%, 10yr -4bps to 4.46%, 30yr -3bps to 4.96%
- USD index: -$0.33 to $99.18
Crude is lower on the geopolitical headlines, though natural gas is higher. Brent is testing support at its 50d ma. Precious metals are gaining as rates and oil fall. Crypto continues to come under pressure with Bitcoin down 3% and falling back towards $60K, currently around Feb lows. High-flying alt-coins are also seeing weakness after weeks of sharp moves for many.
European indexes are mostly higher (FTSE 100 down slightly) and most near best levels. Financials and luxury are some of the leaders while tech and energy lag. Japan, Hong Kong and S. Korea fell over 1%, with tech weak (Softbank -11%, Samsung, SK Hynix down 2.5%).
Earnings:
After-Market: AI, AVGO, CHPT, CRWD, DSGX, FIVE, NTSK, PVH, TLYS, VEEV, WOOF
Pre-Market (Thrs): BF.B, CAL, CIEN, TTC
After-Market (Thrs): AGX, CURV, DOCU, GWRE, IOT, LULU, NX, PL, RBRK, TTAN
Economic Data:
US:
- Challenger Job Cuts: 97.006K vs prior 83.387K
- Jobless Claims: 225K vs 213K cons, prior 215K
- Continuing claims: 1777K vs 1780K cons, prior 1786K
- Q1 Nonfarm Productivity q.q (final): 0.3% vs 0.8% preliminary
- Unit Labor Costs: 1.8% vs 2.3% preliminary
- 10:30am EIA nat gas inventories
- 1:10pm Fed Daly
- 4:30pm Fed Balance Sheet
- Europe Retail Sales m.m (April): -0.4% vs -0.3% cons, prior 0.8% (revised up from -0.1%)
- Spain Industrial Production y.y (April): 2.0% vs 2.0% cons, prior 1.9%
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