| | | Market Snapshot
| Dow | 42519.64 | +214.16 | (0.51%) | | Nasdaq | 19398.94 | +156.34 | (0.81%) | | SP 500 | 5970.37 | +34.43 | (0.58%) | | 10-yr Note |
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| | NYSE | Adv 1923 | Dec 851 | Vol 1.09 bln | | Nasdaq | Adv 3027 | Dec 1448 | Vol 8.05 bln |
Industry Watch
| Strong: Technology, Energy, Industrials, Materials |
| | Weak: Communication Services, Consumer Staples, Real Estate |
Moving the Market
--April Jolts - Job Openings Report offers good indication for labor market with pickup in job openings
-- Russell 2000 and Nasdaq outperform the broader market
-- Continued buying momentum
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Closing Stock Market Summary
03-Jun-25 16:25 ET
Dow +214.16 at 42519.64, Nasdaq +156.34 at 19398.94, S&P +34.43 at 5970.37
[BRIEFING.COM] The stock market got on a winning track this morning and it showed little intention of getting off it once it did, largely dismissing an afternoon contention from Elon Musk that the "one big, beautiful bill" is a "disgusting abomination" since it will massively increase the budget deficit. Small-cap stocks, mega-cap stocks, and semiconductor issues led today's gains, which had some grounding in growth optimism and continued backing from momentum buyers.
Today's start was a bit sluggish, with some consolidation interest in the air. The indices gained some traction around 10:00 a.m. ET, however, following an April JOLTS - Job Openings Report that showed a pickup in openings.
That was viewed as a good indication for the labor market, which conveyed some encouraging thoughts about the growth outlook in spite of the OECD downgrading its 2025 global GDP growth forecast to 2.9% from 3.1% and its U.S. GDP growth forecast to 1.6% from 2.2% and China's Caixin Manufacturing PMI for May registering its weakest reading (48.3) since 2022.
Today's best-performing sector was the information technology sector (+1.5%), which was led by NVIDIA (NVDA 141.40, +4.02, +2.9%) and the semiconductor stocks. The energy sector (+1.1%) was next in line, followed by the materials (+1.0%) and industrials (+0.8%) sectors, exposing today's pro-cyclical orientation.
The Russell 2000 (+1.6%), led by its banking and energy components, outpaced the other major indices. Today's buying efforts, though, were broad-based.
Advancers led decliners by a better than 2-to-1 margin at the NYSE and Nasdaq. Like yesterday, today's advance unfolded on below-average trading volume at the NYSE and Nasdaq.
Separately, Treasuries were little changed from Monday's settlement levels but saw some intraday movement. The 10-yr note yield, which dipped below 4.41% in the overnight futures trade, settled unchanged at 4.46%, while the 30-yr bond yield, which slipped to 4.93%, settled at 4.98%, down two basis points.
- S&P 500: +1.5% YTD
- Nasdaq: +0.5% YTD
- DJIA: -0.05% YTD
- S&P 400: -2.8% YTD
- Russell 2000: -5.7% YTD
Reviewing today's data:
- Factory orders declined 3.7% month-over-month in April (Briefing.com consensus -3.1%) following a downwardly revised 3.4% increase (from 4.3%) in March. Excluding transportation, factory orders declined 0.5% for the second straight month. Shipments of manufactured goods dropped 0.3% on the heels of a 0.2% decline in March.
- The key takeaway from the report is that April activity was devoid of strength, with declines in durable goods orders, nondurable goods orders, and business spending.
- The April JOLTS - Job Openings Report showed there were 7.391 mln job openings versus an upwardly revised 7.200 mln (from 7.192 mln) in March.
NVIDIA and semiconductors power up
03-Jun-25 15:30 ET
Dow +218.04 at 42523.52, Nasdaq +166.52 at 19409.12, S&P +36.92 at 5972.86
[BRIEFING.COM] The stock market is doing what it can to hold on to the vast majority of today's gains, which have been forged on a relative lack of selling pressure. There was a brief dip earlier in the afternoon session that coincided with an Elon Musk X post calling the "one big, beautiful bill" a "disgusting abomination" since it will massively increase the budget deficit.
That dip didn't have any real legs, though, and like most dips since April 7, it was quickly bought.
NVIDIA (NVDA 141.44, +4.06, +3.0%) has been a powerhouse today, driving the broader market and the Philadelphia Semiconductor Index (+2.6%) as it continues to draw in buyers looking to buy the AI leader.
Small caps outperform
03-Jun-25 15:00 ET
Dow +238.82 at 42544.30, Nasdaq +175.43 at 19418.03, S&P +38.29 at 5974.23
[BRIEFING.COM] The major indices are just off their best levels of the day, which are pretty good for the Russell 2000 (+1.7%). Small-cap stocks comprise the best pocket of the market today in what some are describing as a catch-up trade.
Entering today, the Russell 2000 was down 7.3% year-to-date versus a 0.9% gain for the S&P 500. Regional banks and energy stocks have underpinned the small-cap class's outperformance, which was bolstered by an April JOLTS - Job Openings Report this morning that showed a pickup in job openings (a good sign for the labor market and, arguably, the growth outlook).
The cash session for Treasuries has just ended. The 10-yr note yield was unchanged for the day at 4.46%, yet that standing belies the selling that took place after the 10-yr note yield dipped below 4.41% in the overnight trade that featured the weakest Caixin Manufacturing PMI reading for May (48.3) out of China since 2022 and a well-received 10-yr Japanese government bond sale.
S&P 500 gains as ON Semiconductor, Enphase, and Lululemon lead; Kenvue lags
03-Jun-25 14:30 ET
Dow +216.95 at 42522.43, Nasdaq +146.95 at 19389.55, S&P +31.92 at 5967.86
[BRIEFING.COM] The S&P 500 (+0.54%) is in second place among the major averages on Tuesday afternoon.
Briefly, S&P 500 constituents onsemi (ON 46.25, +3.71, +8.72%), Enphase Energy (ENPH 43.51, +2.19, +5.30%), and lululemon athletica (LULU 337.58, +14.63, +4.53%) dot the top of the standings. ON advances with the company's management speaking at a BofA Technology Conference today, while LULU rises ahead of this week's earnings.
Meanwhile, Kenvue (KVUE 22.13, -1.54, -6.51%) is today's top laggard.
Gold slips 0.6% as dollar rebounds, but trade tensions keep safe-haven demand intact
03-Jun-25 14:00 ET
Dow +214.19 at 42519.67, Nasdaq +186.51 at 19429.11, S&P +36.56 at 5972.50
[BRIEFING.COM] With about two hours to go on Tuesday the tech-heavy Nasdaq Composite (+0.97%) is atop the major averages, up more than 185 points.
Gold futures settled $20.10 lower (-0.6%) at $3.377.10/oz, owing in part to a modest rebound in the U.S. dollar, which exerted downward pressure on gold prices due to their inverse relationship. Despite this dip, ongoing uncertainties surrounding global trade, particularly U.S.-China relations, continued to support gold's appeal as a safe-haven asset. Investors remained cautious amid expectations of discussions between U.S. President Trump and China's President Xi, following renewed trade tensions and the announcement of increased U.S. tariffs on steel and aluminum imports.
Meanwhile, the U.S. Dollar Index is up about +0.5% to $99.19.
Credo Tech surging as it wraps up FY25 on a high note; lesser known play on AI buildout
Credo Technology (CRDO +18%) is surging today following its Q4 (Apr) earnings report last night. This supplier of interconnection gear (both copper and optical) in the data center wrapped up FY25 on a high note and sounds bullish on FY26 as well. It beat on EPS while revenue jumped 179% yr/yr and 26% sequentially to $170 mln, also nicely above expectations.
- Probably even more impressive was its huge Q1 (Jul) revenue guidance of $185-195 mln, which was much better than expected. On the call, Credo said it expects FY26 revs to exceed $800 mln vs $437 mln in FY25. Credo sees growing demand for high-speed connectivity products across its hyperscaler customers to power advanced AI services, a trend it expects will continue for the foreseeable future.
- Credo described FY25 as a pivotal year, achieving record revenue, profit, and market adoption of its connectivity products hitting an inflection point. Credo says it pioneered a market that transformed how hyperscalers connect switches and servers, which has positioned it to capture significant opportunities in the global AI infrastructure wave.
- Drilling down a bit, Credo is enthusiastic about the ongoing expansion of the AEC market. Credo has said it believes AEC technology is still in the early stages of widespread adoption and that Credo is well-positioned as the market leader. The company explains that AECs outperform laser-based optics, offering lower power, reduced cost, and maybe most importantly, greater reliability. Credo says its growing traction with hyperscalers is evident with strong customer forecasts and new design wins.
- On the optical side, Credo described FY25 as a standout year. It closed the year with strong momentum, expanding customer diversity across lane rates, port speeds and applications. In Q4, it secured a significant DSP win for an 800-gig transceiver with initial deployments expected on a US hyperscaler in FY26.
Overall, this was an impressive quarter for Credo, especially the Q1 and FY26 guidance. Credo is not one of the first names investors think about as a play on the buildout of AI infrastructure at data centers. However, it is clearly benefitting, especially its AEC segment. While not directly involved in the AI servers, having reliable connectivity gear between the servers is extremely important for them to work at their best.
Constellation Energy powers higher after securing landmark nuclear power agreement with Meta (CEG)
Constellation Energy (CEG) surged as much as 15% in earlier trading today following the announcement of a 20-year power purchase agreement with Meta Platforms (META) to supply nuclear energy from its Clinton Clean Energy facility in Illinois. The stock has since pared most of those gains, though the deal has sparked significant enthusiasm across the nuclear energy sector, driving notable gains in related stocks such as: NANO Nuclear Energy (NNE), Uranium Energy Corp (UEC), Energy Fuels (UUUU), and Centrus Energy (LEU).
This rally underscores the sector’s growing relevance as tech giants seek reliable, carbon-free energy sources, though CEG’s pullback suggests some investors may be reassessing the deal’s immediate financial impact or taking profits after the stock soared by 40% since the end of April.
- META, alongside other tech leaders like Microsoft (MSFT), Google (GOOG), and Amazon (AMZN), is increasingly turning to nuclear power to meet the immense energy demands of AI data centers, which require consistent, high-capacity, and low-carbon energy sources. Recent examples include CEG’s September 2024 agreement to restart Three Mile Island and supply power to MSFT for 20 years, GOOG’s pledge to fund a fleet of new nuclear sites in collaboration with Kairos Power, and AMZN leading a $500 mln investment in small modular reactors (SMRs) alongside its acquisition of a nuclear-powered data center campus in March 2024.
- The political and regulatory landscape has also turned more favorable, with President Trump’s executive orders in May 2025 aimed at accelerating nuclear reactor approvals and strengthening domestic uranium supply chains, targeting a quadrupling of U.S. nuclear capacity by 2050. These developments, coupled with preserved tax credits for nuclear energy, enhance the sector’s growth prospects, particularly for companies like CEG positioned to capitalize on long-term contracts with tech giants.
- The 20-year agreement with META commits CEG to supplying 1,121 megawatts (MW) of emissions-free nuclear energy from the Clinton Clean Energy Center, representing the plant’s entire output, starting in June 2027. The agreement ensures the plant’s operation beyond its scheduled 2027 closure, replacing Illinois’ expiring zero-emission credit (ZEC) program, and CGI and enabling a 30 MW capacity expansion.
- While financial terms were not disclosed, the deal is expected to stabilize CEG’s revenue by securing a long-term buyer for the plant’s output, preserving 1,100 jobs and $13.5 mln in annual tax revenue. The contract enhances CEG’s financial outlook by ensuring consistent cash flows and supporting relicensing efforts, potentially boosting long-term profitability, though near-term impacts may be muted until 2027.
CEG is strategically positioned to meet the surging energy demands of AI-driven data centers, with the 20-year META contract exemplifying how tech giants are increasingly relying on nuclear power for reliable, carbon-free energy. This deal, alongside similar agreements with MSFT and others, underscores CEG’s leadership in the nuclear sector and its potential for sustained growth as AI and clean energy needs converge.
Signet Jewelers shines after posting beat-and-raise report as new merchandising plan pays off (SIG)
Signet Jewelers (SIG) delivered robust 1Q26 results, surpassing top and bottom-line expectations with revenue growing by 2% yr/yr to $1.54 bln, marking its first yr/yr increase in over two years. Same-store sales grew by 2.5%, exceeding SIG's guidance of flat to +2.0%, driven by the company's strategic focus on its largest brands -- Kay, Zales, and Jared -- which saw sequential comp sales improvements through targeted assortment enhancements and refined promotional strategies.
By bolstering offerings at key price points, SIG effectively captured consumer demand, particularly in bridal and fashion jewelry, while leveraging its strong brand portfolio to drive higher transaction values and margin expansion.
- In prior quarters, SIG faced challenges as consumers gravitated toward lower price points at a faster rate than anticipated, exerting pressure on sales and resulting in a 2% decline in same-store sales during the 2024 holiday season. This shift in consumer behavior underscored the need for a more responsive merchandising strategy. Since January, SIG has deepened its assortment at these critical price points.
- Coupled with improving bridal trends, which account for nearly 50% of merchandise sales, this strategic pivot has fueled positive sales momentum, setting the stage for the strong 1Q26 performance and sustained growth into May.
- SIG’s positive comp growth persisted each month of 1Q26 and extended into May, underpinned by a refined promotional strategy that balanced competitive pricing with profitability and disciplined inventory management that optimized stock levels to meet demand. This consistent performance, combined with the company’s strong Q1 results, prompted management to raise its FY26 adjusted EPS guidance while raising the low end of its revenue and comp guidance ranges.
- The cornerstone of SIG’s success lies in its "Grow Brand Love" strategy, which emphasizes transforming its banners into distinct, loyalty-driven brands while expanding into high-growth categories like everyday jewelry and self-purchase. Other key aspects include centralizing sourcing to enhance cost efficiencies, optimizing real estate by transitioning mall-based stores to off-mall and eCommerce channels over the next three years, and refining assortments to align with consumer trends.
- This strategy directly contributed to Q1’s upside, as evidenced by a 100-basis-point yr/yr increase in gross margin to 38.8%, driven by favorable merchandise margins, particularly in digital banners like James Allen and Blue Nile, and a higher mix of services business.
SIGs’ strong 1Q26 earnings beat and raised FY26 guidance were propelled by its strategic focus on key price points, revitalized bridal trends, and the effective execution of its Grow Brand Love strategy. The company’s ability to achieve consistent same-store sales growth and expand margins underscores its adaptability in a dynamic consumer landscape, positioning it well for continued outperformance.
Dollar General surges on huge EPS beat; new CEO is turning the company around (DG)
Dollar General (DG +13%) is heading sharply higher after reporting its largest EPS beat in four years. Revenue in Q1 (Apr) rose 5.3% yr/yr to $10.44 bln, which was also well ahead of expectations. Importantly, DG also raised FY25 revenue and comp guidance while also raising the lower end of FY25 EPS guidance to $5.20-5.80 from $5.10-5.80. DG said it was pleased with its start to the year, including strong same-store sales and EPS results.
- Given the huge EPS upside in Q1, it's reasonable to wonder why FY25 EPS guidance was not raised by more. However, DG cited tariff uncertainty and the possible impact on consumer behavior. On the positive side, DG expects it can mitigate a significant portion of the potential impact to its cost of goods from tariffs. However, consumer spending could be pressured by tariff-related price increases.
- Recall that in October 2023, Dollar General was able to lure former CEO Todd Vasos out of retirement to take his old job back. Mr. Vasos was CEO from June 2015 to November 2022, when the stock made a strong move. He has been revamping thousands of stores, aiming to make them cleaner and more convenient. The plan is to fully remodel around 2,000 additional stores this year. In addition, DG has been updating assortments, including adding produce.
- Same-store sales increased +2.4% in Q1, reflecting a +2.7% increase in average transaction and a -0.3% decrease in customer traffic. Comps included growth in consumables, seasonal, home products, and apparel categories. Comps were a nice improvement from +1.2% in Q4 (Jan), comprised of +2.3% in avg transaction and a -1.1% decrease in customer traffic. The traffic improvement, albeit modest, vs Q4 stands out to us.
- DG said that efforts to improve the customer experience contributed to market share gains in sales of both consumables and non-consumables, and drove growth with both its core customer and trade-in customers. Full year comp growth guidance was increased to +1.5-2.5% from +1.2-2.2% prior guidance. Gross margin improvement was a key reason for the big EPS upside. This was driven primarily by lower shrink and higher inventory markups; partially offset by increased markdowns.
Overall, this was a surprisingly good quarter for Dollar General and it bodes well for peer Dollar Tree (DLTR), which reports tomorrow in the pre-market, and Five Below (FIVE), which reports tomorrow after the close. The new CEO has now been in place close to two years and there seems to be good progress. Freshening up the stores and improving the merchandise is starting to pay dividends. Clearly, analysts were not looking for profitability to be this strong given the tariff situation, but DG seems to be managing it well. The stock chart also looks good. Since gapping lower last August, the stock has stabilized and has been trending nicely higher since mid-January.
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