June 18th Market Overview

Happy Thursday

I guess the Fed scare from yesterday lasted exactly one session. Market bought it all back, chips led the way to record highs, and gas at the pumps slipped under $4 just in time for the long weekend. Energy was the one sore spot as oil kept falling. We're closed tomorrow for Juneteenth. All sides legitimately seem to be winding down the war.

Let’s dig in...

Today's Big Picture

1. The Fed Scare Didn't Have Legs

Wednesday's drop got bought back in a session. Chips led, small caps ran ahead of the big indexes, and the VIX fell under 17, so the Fed fear drained out almost overnight. One catch worth flagging: today was the largest options expiration on record, so some of this was dealers rebalancing their books, not fresh money. The bid was still real though, and traders clearly wanted to be long into the long weekend.

2. Chips Closed At Records

Intel closed at a record high, and the move spread across the group. Micron, Applied Materials, and Marvell all finished at records too, so this was real breadth, not one headline stock. The AI chip trade has led the market all year, and after one ugly Fed day, it's right back in front.

3. Cheap Gas Is Here, Energy Stocks Paid For It

Oil kept falling as the Iran deal settled in, and the national gas average finally dropped below $4 for the first time since March. Vice President Vance said 12.5 million barrels moved through the Strait of Hormuz in a day, so crude is physically flowing again. Great news at the pump, but energy was the day's worst sector, because the oil names always pay for cheaper crude.

Market Overview

Index Performance

Stock Spotlight

Kroger $KR ( ▼ 8.56% )  
had its worst day since 2021 after missing earnings by a penny, even with a revenue beat. New CEO Greg Foran said costs are growing faster than sales and shoppers are buying on sale instead of filling the cart. That's the line that matters, because if it's true at Kroger it's true across grocery.

Enphase $ENPH ( ▲ 9.27% )  
started production shipments of its new IQ9S microinverters and picked up a Barclays upgrade to equal weight, with the target moving to 51 from 30. Solar's been left for dead all year, so a real product milestone plus an analyst flipping positive is a genuine change in tone.

Corning $GLW ( ▲ 10.79% )  
kept climbing as money pours into anything tied to building out data centers. Corning makes the optical cabling that connects all those servers, so it's a quieter way to own the AI buildout without paying up for the chips.

Big Name Updates

Microsoft $MSFT ( ▼ 0.29% )  
is reportedly selling its AI models to big Chinese tech firms through Azure, while OpenAI and Anthropic stay out of China entirely. Microsoft is playing a different game here, taking the revenue its rivals are leaving on the table.

Starbucks $SBUX ( ▲ 0.86% )  
plans to open 50 to 100 new stores a year in India, where its venture with Tata already runs more than 500 locations. India is the growth story now that China has gotten harder for Western brands.

CME Group $CME ( ▼ 2.1% )  
sued the federal futures regulator to block a prediction-market startup from moving onto its turf. The exchange is protecting a near-monopoly, and the fact it's headed to court tells you it sees a real threat.

Other Notable Company News

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Opens up service to Review Curated Venture Deals.
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Accenture $ACN ( ▼ 18.77% )  
closed at its lowest level since 2017 in its worst session on record, after cutting its growth outlook.

Energy Fuels $UUUU ( ▲ 7.84% )  
landed a $725 million, 20-year federal funding commitment to build out U.S. rare-earth supply.

Centrus Energy $LEU ( ▲ 12.68% )  
signed a letter of intent with Oklo $OKLO to supply nuclear fuel for up to five planned Ohio powerhouses, starting in 2029.

Talen Energy $TLN ( ▲ 4.84% )  
got a fresh buy rating from Goldman, which likes its long-term power deal with Amazon as the grid tightens.

Abercrombie $ANF ( ▲ 3.11% )  
is putting its Hollister brand inside Target $TGT for dorm and home decor, launching June 28 ahead of back-to-college.

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Sector Watch

Bond Market

Yields backed off today after Wednesday's run higher, with the 10-year settling around 4.46%.

• The yen slid past 160 per dollar, the weak side of where Japan has stepped in before. Intervention watch is on.

• Mortgage rates eased to 6.47%, a one-month low, though that came after a volatile week and may not hold.

Policy Watch

Fed

Beyond the rate signal, Warsh is rebuilding how the Fed runs. He set up five task forces to review communications, the balance sheet, data, productivity and jobs, and inflation.

• Markets now lean toward a hike by September.

International

• The Bank of England held at 3.75% in a 7-2 vote, pointing to easing energy prices from the Iran deal.

• The Swiss National Bank left its rate at 0%, with inflation still barely registering.

Trade

China pushed back on the G7's plan to cut its reliance on Beijing for rare earths and magnets. With Washington now funding domestic miners, this is the slow decoupling story that keeps showing up under the headlines.

What to Watch

The AI company quietly automating every Walmart distribution center. 
23 billion in orders on the book.

It's just one of seven names in this free MarketBeat report.

Now Every Jobs And Inflation Print Matters

A September hike is the new base case. Between now and then, any hot data pushes that hike closer and the dollar higher.

Hormuz, For Real This Time

The memo is signed, but tanker traffic hasn't fully returned. How fast the strait normalizes decides whether gas keeps falling from here.

Thanks for reading - you are now the more informed 🙂

- John

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