by Michael P. Reinking, CFA - Sr. Market Strategist

Published on 6/02/26 (a/o 1:45 pm)

In the first trading session of June markets US markets got off to a mixed start. Coming into the month the S&P 500 was coming off of 9 consecutive weeks of gains for only the 10th time since the inception of the index. Yesterday the S&P 500 and equal-weight gained ~0.2% while the Russell 2000 fell 0.5%, weighed down by higher oil and yields. Oil prices and Treasury yields moved sharply higher before paring gains after Iran negotiation news took a more optimistic turn mid-day. Tech led the way with software continuing to do its best ‘90s WWE Undertaker impersonation. Jensen Huang’s positive comments on the group during his keynote at the Computex conference provided much of the tailwind.  

Outside of the endless headlines coming out of the tech sector it is a reasonably quiet day.  Markets continue to grind higher with small/midcaps playing some catchup. Things are reasonably quiet on the Iran front, thankfully, for those of us suffering from the headline fatigue though President Trump continues to suggest talks are occurring. As we head to print, the S&P 500 is up 8pts to 7,608 (+0.1%), the Dow is up 152pts to 51,231 (+0.3%), while the Russell 2k is up 18pts to 2,924 (+0.6%).

After the open the first of this week’s labor market data showed an increase in job openings which jumped to 7.62ml up from 6.89ml last month, with most of that increase coming from professional and business services. However, hiring fell 419k to 5.12ml as did the quit rate which hit the lowest level since August 2020. Layoffs and discharges fell, reversing an increase last month, and remains at very low levels. This continues to point to a resilient and stable labor market backdrop. Treasury yields are hovering around unchanged but have ticked up a couple of basis points throughout the session as has the USD index.  

Tech is continuing to lead, though software is giving back some of yesterday’s gains and the mega-cap tech stocks are mixed. Alphabet (-2.5%) cannonballed into the ECM pool after announcing an $80 billion equity raise to funds its AI buildout. Fresh off yesterday’s announcement that its’s buying homebuilder Taylor Morrison, Berkshire Hathaway will be taking down $10 billion of the raise to boost its current stake in the tech giant. New CEO Greg Abel is quickly making his mark.  Aside from BRK’s $10B, $30B will come from underwritten offerings ($15B depository shares representing a convert, $15B equity) and $40B will come from an ATM. One thing to note though, is that ~$30B of the $40B ATM will be used to meet tax obligations for employee equity awards. From a signaling/market perspective this is a big deal as we’ve seen, mega-cap tech companies which have been cash flow/buyback machines over the last decade, start to tap capital markets more aggressively.

Like DELL last week, HPE is seeing a huge post-earnings jump (+25%) after reporting a big beat-and-raise last night. FY26 revenue growth guidance was raised from 17% - 22%, to 29% - 33%. MRVL is flying as well, up >20% after AI Pope Jensen blessed the company as “the next trillion-dollar company” at a tech conference. STM and MCHP both provided updates highlighting robust data center demand, with the latter also hiking prices to counter input cost pressures. The AI headlines are helping to drive performance not only within tech but also industrials and utilities. President Trump also signed an executive order asking AI companies to provide the government early access to new models 30 days before public release (down from 90 days in a previous version). Speaking of Anthropic has been given the green light to give 150 companies access to its Mythos model up from the 50 companies given access in April.

Comm services is leading to the downside with broad based weakness outside of just Alphabet. Healthcare is also down >1% with pretty broad based weakness. Financials are hovering around unchanged with strength in banks and insurance offset by weakness in financial data analytics and payments processors (AI-anxiety). On Friday, the CFTC approved the listing of a Bitcoin perpetual futures contracts which has weighed on exchanges with futures exposure since. Speaking of crypto there has been an acceleration to the recent downside with both Bitcoin and Ethereum down ~5% which is also weighing on crypto exposed stocks (COIN/HOOD). There are a couple of narratives driving the price action including concern over the fate of the Clarity Act but there also seems to be an exit of speculative capital which seems to be moving into equity markets.  Over the last couple weeks there have been over >$3B in Bitcoin ETF liquidations.

European indices closed near session highs up between 0.5% - 1% . Core CPI for May rose to 2.5% y.y from 2.2% in April, just above expectations, likely cementing a rate hike by the ECB next month. Japan’s Nikkei ended down 0.3%. Memory maker Kioxia gained 7% heading into its Analyst Day. The yen weakened against the Dollar again, brushing up against the ¥160 intervention area. China’s markets were higher, led by a sharp gain in the Hang Seng (+2.5%). Tencent added >10% after the FT reported the company was adding an AI agent into its WeChat app. Alibaba gained 7% but has given back some of that during the US session. 

Oil prices are up about 1% reversing overnight losses but still below yesterday’s high. Metals are higher are higher but off the best levels with copper continuing to outperform. Elliot Management has taken a stake in Northern Star Resources, Australia’s largest gold miner and pushing for a strategic/sale review. We discussed the crypto weakness earlier. 

After-Market: GTLB, PANW, ULTA

Pre-Market: CXM, M, MDT

After-Market: AI, AVGO, CHPT, CRWD, DSGX, FIVE, NTSK, PVH, TLYS, VEEV, WOOF

US:

Global: