June 29th Market Overview

Happy Monday

Nice bounce to start a short week. Tech snapped a big losing streak, the Dow is flirting with a record close after adding Alphabet, and the Supreme Court told the White House they can't touch the Fed.

Gold in the headlines today and is getting wrecked this quarter but that’s mainly just price discovery coming off very hot year for gold and other precious metals.

Let’s dig in...

Today's Big Picture

1. Supreme Court Protects The Fed
The court ruled 5-4 that Trump can’t fire Fed Governor Lisa Cook, saying she never got due process. More importantly, the justices carved out a specific exception for the Federal Reserve while expanding presidential power to fire leaders at other independent agencies. Bond yields barely moved because this was the expected outcome, but it removes a real tail risk that had been hanging over rate policy.

2. Comcast Splits, Telecom M&A Heats Up
Comcast $CMCSA is spinning off NBCUniversal and Sky into a standalone media company. Co-CEO Mike Cavanagh will lead the new entity. The bigger story is what comes next. Charter $CHTR rallied hard on speculation that a slimmed-down Comcast bids for them after the split. Same day, Rocket Lab $RKLB announced an $8 billion deal to buy Iridium $IRDM for its satellite fleet and spectrum. Broadband companies are racing to bulk up before Starlink eats their margins.

3. Gold Posts Record Quarterly Loss
Gold fell to $4,022 an ounce, now down over $625 this quarter. That is the largest quarterly dollar decline ever recorded. Silver is off 22 percent this quarter, the worst in 13 years. Goldman Sachs still sees $4,900, calling this a structural bull market pullback. Whether central bank buying resumes at these levels will tell us a lot.

Market Overview

Index Performance

Stock Spotlight

Rocket Lab $RKLB ( ▲ 16.23% )  
is buying Iridium $IRDM at $54 per share in a cash-and-stock deal worth $8 billion. The combination gives Rocket Lab a working satellite fleet, wireless spectrum, and a real path to compete with SpaceX $SPCX beyond launch services.

Strategy $MSTR ( ▲ 13.07% )  
announced a turnaround plan that includes stock buybacks and bitcoin sales. The stock bounced but is still down over 40 percent in June. Michael Saylor is trying to stop the bleeding after both common and preferred shares fell apart this month.

Charter Communications $CHTR ( ▲ 9.51% )  
rallied on two catalysts at once. The Comcast split opened the door to a potential acquisition, and a Bloomberg report said Charter and SpaceX $SPCX have been in talks about a consumer mobile phone product.

Tesla $TSLA ( ▲ 8.46% ) climbed after NHTSA closed a safety probe into power steering loss on 2023 Model 3 and Model Y vehicles. Elon Musk also said FSD version 14 is rolling out to customers.

Big Name Updates

Alphabet $GOOG ( ▲ 4.52% )  
officially replaced Verizon in the Dow today. Shares climbed on day one, though the Dow’s price-weighted methodology means Alphabet won’t carry as much influence as its market cap would suggest.

Microsoft $MSFT ( ▼ 1.24% )  
is on pace for its worst month since December 2000. Deutsche Bank maintained a Buy rating and a $550 target, pointing to confidence in margin expansion.

Marvell Technology $MRVL ( ▲ 3.98% )  
got a price target raise from UBS to $340 from $230, driven by demand for its CXL products in AI data center memory systems. The stock is up over 200 percent this year.

Other Notable Company News

Owens Corning $OC ( ▲ 15.38% )  
climbed after the WSJ reported that Carlisle Companies $CSL made an unsolicited offer to acquire the company. Owens Corning hasn’t engaged significantly yet.

Verizon $VZ ( ▼ 5.11% )  
is forming a joint venture with BT Group for international enterprise connectivity. Verizon flagged an expected Q2 loss of up to $800 million tied to the deal.

British American Tobacco $BTI ( ▼ 0.38% )  
is cutting 5,500 jobs and outsourcing 3,500 more to save roughly $793 million by 2028.

SpaceX $SPCX ( ▲ 7.68% )  
will join the Nasdaq-100 before market open on July 7. Less than a month from IPO to index inclusion.

Baidu $BIDU ( ▲ 6.29% )  
climbed on reports that its AI chip unit Kunlunxin is targeting a Hong Kong IPO at a $50 billion valuation.

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Sector Watch

Bond Market

Treasuries were flat. The 10-year held at 4.37 percent, the 2-year at 4.10, the 30-year just under 4.86.

Policy Watch

Fed

The Supreme Court kept Lisa Cook in her seat, 5-4. The justices said she never got due process before the firing attempt. They carved out a specific exception protecting the Fed while expanding presidential firing power over other agencies like the FTC.

• Rate hike expectations are building. Futures imply at least one hike by year end. Bank of America is modeling 75 basis points worth.

International

The US and Iran agreed to pause hostilities Sunday and reopen commercial shipping through the Strait of Hormuz. Both sides meet Tuesday in Doha for renewed talks.

• Hormuz traffic dropped to just 22 crossings on Sunday. Hundreds of ships remain stuck in the Persian Gulf. Shipowners are still spooked despite the ceasefire.

• Oil ticked higher but stayed well below pre-war levels.

Fiscal & Trade

China blacklisted four Japanese defense research institutes and restricted exports to 20 more Japanese entities. The restrictions cover rare earths, batteries, machine tools, and chip equipment. This is a real escalation in the China-Japan trade friction.

What to Watch

The AI company quietly automating every Walmart distribution center.
Already has 23 billion in orders on the book. It's just one of seven names in this free MarketBeat report.

Doha Talks (Tuesday)
US and Iran sit down in Qatar. If talks hold, oil stays calm. If they break down, crude moves fast.

Nike Earnings (Tuesday)
Nike $NKE reports after the bell. Good read on the consumer and on how China tariff exposure is hitting the business.

Quarter-End Rebalancing
Last two trading days of Q2. Some of today's tech bounce could just be advisors cleaning up their quarterly statements.

Thanks for reading - you are now the more informed 🙂

- John

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