STRAIGHT FROM THE TRADING FLOOR
by Eric Criscuolo & Michael P. Reinking
Published on 6/26/26 (a/o 9:00 am)
Good morning and Happy (Now semi-)annual Russell Reconstitution Day,
The S&P 500 ended yesterday around unchanged while the equal-weight and Russell 2000 rose 0.7% each. Tech weakness was the driver for the divergence. While Micron’s blowout earnings took its shares 16% higher (and those of other memory/storage names up as well) the rest of the tech sector was under pressure. This included the hyperscalers and smaller neoclouds as concern around exploding costs compounded. Broader pricing concerns then manifested after Apple (-6%) announced big prices increases across most of its lineup and Microsoft (-4%) said it was raising Xbox prices. Meanwhile Industrials, Healthcare and Materials led to the upside. Outside of equities, crude rose on news of a cargo ship attacked in the Strait for using a sea lane closer to Oman that Iran hadn’t sanctioned. Yields ended flat-ish after the PCE print was more or less inline, GDP revised higher and Personal Income/Spending above estimates.
S&P futures are trading lower this morning ahead of the big Russell index reconstitution at the close today. The event has returned to a semi-annual schedule for the first time in decades but you can still expect big volumes today. Futures are fading back toward their overnight lows as we approach the Open. The pre-market decliners list is littered with Tech. The NYT reported last night that OpenAI is leaning towards delaying its IPO to 2027, due to the volatility in AI names and the post-IPO performance of SpaceX, among other factors. Memory and storage names are giving back some of yesterday’s outsized gains (MU, SNDK down 6%). ON Semiconductor is down over 10% after announcing a deal to acquire Synaptics for $7B in a all-stock deal.
The treasury curve is steepening this morning as the 2y falls 3bp while 10/30y are flat/up 2bp. The US Dollar Index is pulling back a bit after reaching 101.50 the past 2 days.
US 2yr -3bps to 4.10%, 5yr -1bps to 4.15%, 10yr +0bps to 4.40%, 30yr +2bps to 4.88%
USD index: -$0.22 to $100.98
Oil prices are reversing yesterday’s bounce down >3% as Saudi Arabia began crude loadings at its Ras Tanura terminal for the first time in over three months. In addition, the IAEA said nuclear inspectors will be given access to Iran as part of the interim deal. For the week the commodity is down ~10% it’s 5th decline in the last 6 weeks, which has completely reversed the Iran rally. Natural gas prices are up ~1.5% at the front end of the curve, the July contract expires today. The overnight reversal in the USD is helping the metals rebound. Gold retested 4k overnight and is up 0.4% at ~4,060. Silver retested its recent lows (55.75) before trading back up to ~58. Copper held its 100d ma and is now up ~0.5%. Ag is moving lower. Bitcoin tried to bounce overnight trading back up to nearly 61k but has turned lower again holding ~59k, yesterday’s low was 57.5k.
Over in Japan the Nikkei tumbled over 4%. The OpenAI news did help SoftBank (-13%) while other tech names sold off sharply as well. Banks were mostly higher. Tokyo CPI rose for the first time in 8 months. China and Hong Kong indexes were lower as well. South Korea’s KOSPI fell 6%. European indexes are faring slightly better but still off ~1% across the region. Volkswagen is planning to cut up to 100k jobs, or 15% of its workforce, over the next few years, according to reports. Consumer inflation expectations moved lower according to the ECB’s latest report.
Earnings:
US:
The S&P 500 ended yesterday around unchanged while the equal-weight and Russell 2000 rose 0.7% each. Tech weakness was the driver for the divergence. While Micron’s blowout earnings took its shares 16% higher (and those of other memory/storage names up as well) the rest of the tech sector was under pressure. This included the hyperscalers and smaller neoclouds as concern around exploding costs compounded. Broader pricing concerns then manifested after Apple (-6%) announced big prices increases across most of its lineup and Microsoft (-4%) said it was raising Xbox prices. Meanwhile Industrials, Healthcare and Materials led to the upside. Outside of equities, crude rose on news of a cargo ship attacked in the Strait for using a sea lane closer to Oman that Iran hadn’t sanctioned. Yields ended flat-ish after the PCE print was more or less inline, GDP revised higher and Personal Income/Spending above estimates.
S&P futures are trading lower this morning ahead of the big Russell index reconstitution at the close today. The event has returned to a semi-annual schedule for the first time in decades but you can still expect big volumes today. Futures are fading back toward their overnight lows as we approach the Open. The pre-market decliners list is littered with Tech. The NYT reported last night that OpenAI is leaning towards delaying its IPO to 2027, due to the volatility in AI names and the post-IPO performance of SpaceX, among other factors. Memory and storage names are giving back some of yesterday’s outsized gains (MU, SNDK down 6%). ON Semiconductor is down over 10% after announcing a deal to acquire Synaptics for $7B in a all-stock deal.
The treasury curve is steepening this morning as the 2y falls 3bp while 10/30y are flat/up 2bp. The US Dollar Index is pulling back a bit after reaching 101.50 the past 2 days.
US 2yr -3bps to 4.10%, 5yr -1bps to 4.15%, 10yr +0bps to 4.40%, 30yr +2bps to 4.88%
USD index: -$0.22 to $100.98
Oil prices are reversing yesterday’s bounce down >3% as Saudi Arabia began crude loadings at its Ras Tanura terminal for the first time in over three months. In addition, the IAEA said nuclear inspectors will be given access to Iran as part of the interim deal. For the week the commodity is down ~10% it’s 5th decline in the last 6 weeks, which has completely reversed the Iran rally. Natural gas prices are up ~1.5% at the front end of the curve, the July contract expires today. The overnight reversal in the USD is helping the metals rebound. Gold retested 4k overnight and is up 0.4% at ~4,060. Silver retested its recent lows (55.75) before trading back up to ~58. Copper held its 100d ma and is now up ~0.5%. Ag is moving lower. Bitcoin tried to bounce overnight trading back up to nearly 61k but has turned lower again holding ~59k, yesterday’s low was 57.5k.
Over in Japan the Nikkei tumbled over 4%. The OpenAI news did help SoftBank (-13%) while other tech names sold off sharply as well. Banks were mostly higher. Tokyo CPI rose for the first time in 8 months. China and Hong Kong indexes were lower as well. South Korea’s KOSPI fell 6%. European indexes are faring slightly better but still off ~1% across the region. Volkswagen is planning to cut up to 100k jobs, or 15% of its workforce, over the next few years, according to reports. Consumer inflation expectations moved lower according to the ECB’s latest report.
Earnings:
- After-Market (Thrs): FDXF
- Pre-Market: None
US:
- Goods Trade Balance: $-105.8B vs $-85B cons, prior $-83.01B
- Retail Inventories, ex-Autos: 0.4% vs 0.7% prior
- Wholesale Inventories m.m: 0.3% vs 0.2% cons, prior 0.7%
- 10:00am Univ. Michigan Sentiment (Final)
- Fed Speakers: Williams (10:30am), Kashkari (11:30am)
- 1:00pm Rig Count
- Tokyo Core CPI y.y: 1.6% vs 1.6% cons, prior 1.3%
- ECB Consumer Inflation Expectations: 3.5% vs prior 4.0%
- Italy Business Confidence: 88.4 vs 88.4 cons, prior 87.9
- Italy Consumer Confidence: 92.4 vs 94.5 cons, prior 93.4
- France Unemployment Claims: 15.5K vs prior -9.0K
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