June 23, 2025
S&P futures are up 0.2% in early trading following a mostly lower Friday session. The major indexes finished the week narrowly mixed, with strength in banks, semis, credit cards, refiners, casual diners, cruise lines, and auto retailers, while managed care, pharma, tobacco, and off-price retail lagged. Overnight, Asian markets closed well off lows, and Europe is slightly weaker (~0.1%). Treasuries are a bit softer with yields up ~1 bp. Dollar index +0.7%, gold -0.2%, Bitcoin futures +1%, and WTI crude +0.5%.
Markets appear largely unfazed by the weekend’s major geopolitical event, as the U.S. bombed three Iranian nuclear sites (Fordo, Natanz, Isfahan). Market participants remain skeptical Iran will disrupt traffic through the Strait of Hormuz. Elsewhere, Trump renewed criticism of Fed Chair Powell for not cutting rates. On the fiscal front, the reconciliation bill remains complicated by Senate parliamentarian exclusions. Trade headlines noted progress between the U.S. and EU on non-tariff issues, but China continues to delay rare earth export approvals.
Key data today includes flash PMIs and existing home sales. The week ahead brings home price data, consumer confidence, Richmond and Philly Fed surveys, jobless claims, core PCE, and final Q1 GDP. Powell’s semi-annual policy testimony begins Tuesday. Fed stress test results and heavy Treasury issuance also in focus.
Corporate Highlights
- AAPL reportedly held internal talks about acquiring AI firm Perplexity AI.
- TSLA began its first Robotaxi service rides in Austin on Sunday.
- TM will raise U.S. vehicle prices by over $200 next month.
- BK approached NTRS about a potential merger, though no formal offer discussed.
- WOLF confirmed a bankruptcy filing after reaching a deal with creditors.
U.S. equities ended mostly lower in a quiet Friday session as major indexes closed out a narrowly mixed week. The S&P 500 dipped 0.22%, while the Nasdaq lost 0.51%. The Dow finished modestly higher, and the Russell 2000 outperformed. Treasuries were firmer with a bull flattening bias, reversing an earlier steepening move. The dollar index fell 0.2%, gold declined 0.7%, Bitcoin futures slipped 0.6%, and WTI crude rose 0.5%.
Markets remained in wait-and-see mode with no major catalysts. Tensions in the Middle East lingered, though Friday brought few new developments. President Trump reiterated he would take two weeks to decide on possible military action against Iran, while Iran signaled willingness to negotiate on uranium enrichment. Trade remained stagnant with no progress from G7 talks and continued tariff pressure. On fiscal policy, debate over Medicaid cuts, SALT, and clean energy credits continues to stall reconciliation efforts.
On the policy front, the June Philly Fed manufacturing index came in at -4.0, unchanged from May, with declines in employment and prices-paid components. Fed Governor Waller reiterated a dovish stance, suggesting the Fed could cut rates as soon as the next meeting, viewing tariffs as a one-time inflation impulse. Richmond Fed’s Barkin countered, citing no urgency from current data. Key data next week includes flash PMIs, home sales, durable goods, final Q1 GDP, core PCE, and Powell’s semi-annual monetary policy testimony. Fed stress test results and Treasury supply ($183B across 2-, 5-, and 7-year notes) are also in focus.
S&P 500 Sector Performance
- Outperformers: Energy +1.05%, Consumer Staples +0.62%, Financials +0.27%, Utilities +0.26%, Industrials +0.14%, Real Estate -0.06%, Consumer Discretionary -0.20%
- Underperformers: Communication Services -1.83%, Materials -0.65%, Healthcare -0.46%, Information Technology -0.26%
Consumer Discretionary
- GMS +23.8%: Rallied on reports HD submitted a competing bid to acquire the company, after QXO made a $5B unsolicited offer earlier in the week.
- KMX +6.6%: Beat on Q1 EPS, revenue, comps, and margins. Used unit comps rose 8.1%, the best since 2021.
- DRI: Reported EPS and comp beat; raised dividend and announced share buyback.
- PARA: Reportedly delaying a $35M settlement with President Trump.
Consumer Staples
- KR +9.8%: EPS beat, in-line revenue, slightly higher y/y gross margins. Strong sales in pharmacy, eComm, and fresh segments. Plans to close 60 stores over 18 months.
- MDLZ +3.0%: Upgraded to Overweight at Wells Fargo on positive long-term growth and pricing execution.
Information Technology
- ACN -6.9%: Beat on FQ3 revenue and earnings but margins were light. Analysts cited weaker bookings and soft discretionary IT spending as negatives.
- REGN/SNY: Dupixent received FDA approval for treatment of bullous pemphigoid.
Healthcare
- LLY -2.8%: UK’s NHS said its Alzheimer’s treatment donanemab (Kisunla) isn’t cost-effective and should not be covered.
Industrials
- KBR -7.3%: Declined after the U.S. TRANSCOM terminated HomeSafe Alliance’s role in a household goods contract.
Financials
- Outperformance driven by banks and property & casualty insurers amid improving rate expectations.
Energy
- Sector gained 1.05%, helped by a rebound in crude and continued geopolitical risk premium.
Eco Data Releases | Monday June 23rd, 2025
S&P 500 Constituent Earnings Announcements | Monday June 23rd, 2025
Data sourced from FactSet Research Systems Inc.
