June 1st Pre-Market

Good Morning

Wild kick off to the month. Nvidia's making chips for laptops now, the whole tech complex is following it up, and futures are green. Oil popped on more Iran headlines over the weekend but the market's barely blinking.

May was a monster. Nine straight green weeks on the S&P. I'm not going to be the guy who calls the top while strong companies are putting out strong revenue, so I'll just enjoy the green and keep one eye on Friday's jobs report.

Let's dig in...

Today's Big Picture

1. Nvidia Walked Onto Everyone Else's Turf 

Nvidia unveiled an Arm-based PC chip with Microsoft, landing in fall laptops from Dell and HP. The story isn't the chip. It's who gets hurt. Qualcomm, Intel and AMD are all lower because Nvidia just walked into the one market they thought was safe, and that's the first real crack in the x86 PC monopoly. Software and hyperscalers are ripping on the same news, which is why futures are green.

2. Oil Is Up. Stocks Don't Care. Bonds Do. 

The US and Iran traded strikes near the Strait of Hormuz over the weekend, and overnight Iran fired missiles at US forces in Kuwait. Brent is back above $94 and stocks are looking right through it, betting a deal gets signed any day. But the 10-year yield is climbing, and traders are now pricing a Fed hike instead of a cut. Equities are positioned for easy money. Bonds are positioned for the opposite. One of them is wrong.

3. Buffett's Gone. Abel Just Bought A Homebuilder. 

Berkshire is buying Taylor Morrison for $6.8 billion in cash, and the stock is up more than 20% premarket. It's Greg Abel's first big deal since taking over, and the tell is where the money went: housing, not AI, with the market at record highs. Everyone else is chasing chips. Berkshire is quietly buying the corner nobody wants. Berkshire shares are flat.

Market Overview

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Stock Spotlight (pre-market)

Qualcomm $QCOM ( ▲ 3.18% )  
is lower because Nvidia just entered the PC chip market it spent two years trying to crack. Now Qualcomm has to prove its Windows chip still has a reason to exist.

Arm Holdings $ARM ( ▲ 5.38% )  
is higher because its architecture sits inside Nvidia's new chip. Every x86 holdout now has to ask if they're on the wrong side of the design.

MGM Resorts $MGM ( ▲ 1.72% )  
is up double digits on an $18 billion takeover bid from Barry Diller's IAC at $48.30 a share. A named buyer and a real price means the rest of the casino group gets repriced on read-through.

IBM $IBM ( ▲ 12.71% )  
is up almost double digits after Barclays started it at overweight on quantum, with Melius lifting its target. Funds with zero quantum exposure suddenly have a name they have to explain owning, or not.

Summit Therapeutics $SMMT ( ▲ 0.75% )  
is higher after a China trial showed its lung cancer drug cut the risk of death by a third. The bigger players in that space now have to watch a global trial that's still running.

Robinhood $HOOD ( ▲ 11.15% )  
is lower with Bitcoin near $72,000 after Bitcoin ETFs posted their first-ever 10-day outflow streak. Coinbase is sliding with it, and anyone long crypto-beta has to decide if this is a dip or a top.

What to Watch

Friday's Jobs Report (8:30 AM ET)
The whole rate debate routes through this number. Forecasts are near 90,000, down from 115,000. With oil up and inflation sticky, a strong print is what flips the Fed from cuts to a hike, and the rate-sensitive names leading this rally get hit first.

HPE Earnings (Today, After The Bell) 

The next test of the AI hardware demand Nvidia just hyped. A strong number confirms the buildout. A soft one is the first crack in the story carrying this tape.

Broadcom Earnings (Wednesday)
The last big semiconductor name to report, and the cleanest read on AI chip demand after HPE. A beat confirms what Nvidia's been selling all morning. A miss puts the whole semi trade in focus.

The Oil-To-Yields Chain (Sleeper) 
The trade here isn't oil, it's the 10-year. If Brent holds above $90, yields keep climbing and do the Fed's tightening for it. That also quietly squeezes the exact growth names sitting at record highs as money flows into bonds.

- John

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