Market Snapshot
| Dow | 43386.84 | +404.41 | (0.94%) | | Nasdaq | 20167.93 | +194.36 | (0.97%) | | SP 500 | 6141.02 | +48.86 | (0.80%) | | 10-yr Note |
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| | NYSE | Adv 2269 | Dec 513 | Vol 1.15 bln | | Nasdaq | Adv 3098 | Dec 1406 | Vol 8.42 bln |
Industry Watch
| Strong: Industrials, Communication Services, Materials, Energy, Consumer Discretionary |
| | Weak: Consumer Staples, Real Estate |
Moving the Market
-- Market makes another push toward record highs
-- Strong quarterly results from Micron (MU)
-- President Trump thinking of naming a replacement for when Fed Chair Powell's term ends in May 2026 by September or October, if not sooner, according to The Wall Street Journal
| Closing Stock Market Summary
26-Jun-25 16:20 ET
Dow +404.41 at 43386.84, Nasdaq +194.36 at 20167.93, S&P +48.86 at 6141.02
[BRIEFING.COM] It was a much better-looking market today than yesterday. Yesterday's market wasn't "bad" in terms of returns, but it wasn't so great in terms of participation. Today was a different story. The returns looked even better, and the participation was broad-based.
Advancers led decliners by a better than 4-to-1 margin at the NYSE and by a better than 2-to-1 margin at the Nasdaq.
An encouraging earnings report and outlook from Micron (MU 126.00, -1.25, -0.98%), which was up 107% from its April 7 low going into the report, provided the jumpstart, along with hopes of easier monetary policy that were stirred by a Wall Street Journal report indicating the president is thinking about naming the replacement for when Fed Chair Powell's term ends in May 2026 by September or October, if not sooner. The 2-yr note yield dropped six basis points to 3.72%, and the 10-yr note yield fell four basis points to 4.25%.
A strong durable goods orders report for May and a comforting initial jobless claims report for the week ending June 21 lent some added support with their positive growth takeaways, overshadowing the downward revision to the dated Q1 GDP report.
The communication services sector (+1.8%) was today's best-performing sector, but the cyclical energy (+1.5%), consumer discretionary (+1.2%), industrials (+1.1%), and materials (+1.1%) sectors outperformed in today's session, which was subsidized by continued advances in the mega-cap stocks.
Separately, the Philadelphia Semiconductor Index, paced by gains in Marvell (MRVL 79.97, +4.04, +5.32%) and Broadcom (AVGO 270.17, +5.52, +2.09%), rose 0.9%, bringing its quarterly gain to 29.8%. NVIDIA (NVDA 155.02, +0.71, +0.46%) also contributed to today's move.
While the mega-cap cohort did just fine today, it was the small-cap and mid-cap stocks that shined. The Russell 2000 finished up 1.7%, while the S&P Midcap 400 Index increased 1.3%.
The S&P 500, which needed a move above 6,147.43 to set a new all-time high, came within a whisker of doing so, hitting an intraday high of 6,146.52. It also flirted with a record closing high but fell just short in that regard, too.
- S&P 500: +4.4% YTD
- Nasdaq: +4.4% YTD
- DJIA: +2.0% YTD
- S&P 400: -0.8% YTD
- Russell 2000: -2.6% YTD
Reviewing today's data:
- Durable goods orders surged 16.4% month-over-month in May (Briefing.com consensus 6.6%) on a 230.8% increase in orders for nondefense aircraft and parts. Excluding transportation, durable goods orders were up 0.5% month-over-month (Briefing.com consensus 0.1%).
- The key takeaway, however, is that new orders for nondefense capital goods, excluding aircraft -- a proxy for business spending -- increased 1.7% on the heels of a 1.4% decline in April, reflecting a strong rebound after the reciprocal tariff pause announcement.
- Initial jobless claims for the week ending June 21 decreased by 10,000 to 236,000 (Briefing.com consensus 247,000), while continuing jobless claims for the week ending June 14 increased by 37,000 to 1.974 million, which is the highest level since November 6, 2021.
- The key takeaway from the report is that initial jobless claims -- a leading indicator -- remain entrenched at fairly low levels that are not associated with a recession or even a significant slowdown for that matter, but to be fair, continuing jobless claims are elevated and do point to some softening in the labor market. Businesses may not be laying off a lot of employees, but it has gotten more challenging to find a new job after losing a job.
- The third estimate for Q1 GDP featured a downward revision to -0.5% (Briefing.com consensus -0.2%) from the second estimate of -0.2% that was driven by downward revisions to consumer spending and exports that were partly offset by a downward revision to imports. The GDP Price Deflator increased to 3.8% (Briefing.com consensus 3.7%) from the second estimate of 3.7%.
- The key takeaway is that this report is very much "dated," given that we are just a few days away from the end of the second quarter, so it shouldn't have much cachet as a mover for a market that has been cheered since early April by the arrival of hard economic data that has quieted recession concerns.
- The Advance International Trade in Goods deficit widened to $96.6 billion in May from -$87.0 billion in April, with exports dropping more than imports. Adv. Retail Inventories increased 0.3% after being unchanged in April, and Adv. Wholesale Inventories fell 0.3% after a 0.1% increase in April.
- May Pending Home Sales +1.8% (Briefing.com consensus 0.4%; prior -6.3%).
Hovering near session highs
26-Jun-25 15:30 ET
Dow +375.73 at 43358.16, Nasdaq +199.07 at 20172.64, S&P +48.29 at 6140.45
[BRIEFING.COM] The major averages continue to hover near their session highs in a day that has seen broad-based participation, with nine sectors poised to close in positive territory.
Real estate (-0.9%) and consumer staples (-0.3%) lag behind the broader market.
The top-weighted technology sector (+0.7%) tracks the S&P 500 (+0.7%), with Apple (AAPL 200.92, -0.64, -0.32%) restraining further gains. Financial Times reports that Apple is revising its app-store policies to avoid fines from the EU. Most notably, the company will now allow iOS apps to be offered outside of the Apple App Store.
Separately, the 2-yr note yield settled the day down six basis points at 3.72%, while the 10-yr note yield settled down four basis points at 4.25%. Aside from a large slate of economic data and a 7-yr note auction, the market also digested a report that President Trump is thinking about announcing a replacement for when Fed Chair Powell's term ends in May 2026 by September or October, if not sooner.
Sitting on doorstep of record high
26-Jun-25 15:00 ET
Dow +368.15 at 43350.58, Nasdaq +185.74 at 20159.31, S&P +44.53 at 6136.69
[BRIEFING.COM] The stock market continues to see steady growth as the S&P 500 (+0.7%) is now on the doorstep of its all time high (6,147) from February, while the tech-heavy NASDAQ Composite (+1.0%) outperforms. Today's session high, reached in the past hour, is 6,144.66, which was a smidgen above the record closing high of 6,144.15 reached on February 19.
Communication services (+1.6%) is the strongest performing sector, bolstered by Meta Platforms (META 727.15, +18.47, +2.61%), which Bloomberg reports is continuing its AI investment strategy by entering talks to acquire the Generative AI company PlayAI.
Chip stocks are holding on to their gains as well, with the PHLX Semiconductor Index hovering near session highs at +0.9%, led by NVIDIA (NVDA 155.68, +1.38, +0.89%).
S&P 500 lags despite gains; COIN, FCX, ALB rally as EQIX tumbles on guidance
26-Jun-25 14:30 ET
Dow +400.59 at 43383.02, Nasdaq +202.38 at 20175.95, S&P +50.70 at 6142.86
[BRIEFING.COM] The S&P 500 (+0.83%) is near HoDs, in last place among the major averages with more aggressive gains elsewhere.
Briefly, S&P 500 constituents Freeport-McMoRan (FCX 44.62, +3.01, +7.23%), Coinbase Global (COIN 380.56, +25.19, +7.09%), and Albemarle (ALB 64.55, +4.17, +6.91%) pepper the top of the standings. FCX rises owing to strength in copper futures, while COIN caught a target bump to $395 at Oppenheimer this morning.
Meanwhile, Equinix (EQIX 757.59, -66.72, -8.09%) is the worst-performing constituent after lower-than-expected near-term AFFO growth guidance and increased capital spending plans led to several analyst downgrades and price target cuts, overshadowing its long-term AI-driven growth story.
Gold rises as dollar weakens, Fed uncertainty sparks safe-haven demand
26-Jun-25 14:00 ET
Dow +364.42 at 43346.85, Nasdaq +174.78 at 20148.35, S&P +45.43 at 6137.59
[BRIEFING.COM] The Nasdaq Composite (+0.88%) is in first place on Thursday afternoon, up almost 175 points.
Gold futures settled $4.90 higher (+0.2%) at $3,348.00/oz, propped up primarily by a weaker U.S. dollar and renewed uncertainty over Federal Reserve policy. Reports suggesting President Trump may replace Fed Chair Powell as early as September or October stirred concerns about the central bank's independence and hinted at a more aggressive rate-cut approach, supporting gold's safe-haven appeal.
Meanwhile, the U.S. Dollar Index is down -0.6% to $97.10.
MillerKnoll bounces back with strong Q4 and guidance after lackluster Q3 report
MillerKnoll (MLKN +12%) is trading sharply higher following a nice EPS beat for Q4 (May) last night. This is a nice bounce back quarter after a very modest beat in Q3 (Feb). The upside move in this office furniture supplier appears to be driven by management's cautiously optimistic tone and encouraging trends, including continued momentum around office re-entry. As such, investors are responding positively to the improved outlook.
- The EPS beat can be attributed to better-than-expected sales and strong gross margin performance, which improved 130 bps sequentially to 39.2%. Revenue came in at $962 mln, up 8.2% yr/yr and well above the mid-point of guidance.
- Management attributed the upside to broad-based strength across all segments, marking a clear rebound from Q3, which was noticeably impacted by macroeconomic headwinds.
- MLKN's North America Contract segment saw a 13% yr/yr increase in sales, with new orders up nearly 16% yr/yr. This growth was largely driven by demand being pulled forward ahead of the company's April 21 tariff-related surcharge and June 2 price increase. Additionally, the International Contract segment saw sales up 6.9% yr/yr and new orders up 3.6% yr/yr.
- What really stood out about this report was the upside guidance for Q1 (Aug), the mid-point of which was well above analyst expectations. MLKN cited increased office leasing activity and consistent yr/yr growth in industry orders. Management also highlighted several levers it can pull to drive revenue in light of the current macro environment.
Investors were pleased to see the large EPS upside and especially the bullish guidance for Q1. The investment community has been hoping for solid signs of a return to work. This report was a good sign that MLKN is making progress. Shares have been trading mostly sideways in the $16.50-$17.50 range over the last month. Investors were cautious heading into this report given the lackluster Q3 report. As such, it was good to see the stock break above that range on this report.
Jefferies' Q2 EPS miss on fixed income weakness signals mixed picture for financial sector (JEF)
Jefferies (JEF) reported 2Q25 results after the close last night, falling short of EPS expectations primarily due to softness in Fixed Income net revenue and modest one-time non-compensation expenses. As the first major investment bank to report, JEFs’ results are closely watched as a bellwether for the financial sector’s Q2 earnings season, offering early insights into trends in investment banking, capital markets, and trading. Despite the earnings miss, the company’s diversified business model and resilient Advisory segment provide a nuanced backdrop for broader sector expectations.
- The first two months of the quarter proved challenging for JEF, with equity underwriting particularly hard-hit, experiencing a 51% yr/yr decline in net revenue to $122.4 lnn due to volatile equity market conditions that stifled IPO and follow-on deal activity. However, a notable recovery in May bolstered the Investment Banking Advisory business, which saw robust strength driven by increased merger and acquisition (M&A) activity.
- JEFs’ management expressed growing optimism for 2H25, citing a strong deal pipeline, active client discussions around capital formation, and improving investor confidence as key drivers of expected momentum. This late-quarter upswing suggests that stabilizing market conditions could pave the way for a stronger performance in the coming months.
- Drilling down further on the Q2 results, Investment Banking net revenue rose 6.4% yr/yr to $786 mln, propelled by a standout 61% surge in Advisory revenue to $457.9 mln, reflecting significant market share gains and a rebound in M&A activity. The robust Advisory growth was fueled by JEFs’ strategic investments in its platform, including its alliance with Sumitomo Mitsui Financial Group, which has enhanced its global reach and cross-border M&A capabilities.
- However, this strength in Advisory was partially offset by a 51% plunge in Equity underwriting revenue, driven by a soft IPO market early in the quarter, as volatility dampened investor appetite for new issuances. Debt underwriting revenue remained flat at $205.36 mln, providing some stability but failing to counterbalance the equity segment’s weakness.
- The Capital Markets segment saw a slight yr/yr decline in net revenue to $704 mln, down 0.4% from the prior year, with a bifurcated performance between Equities and Fixed Income. Equities net revenue jumped 24% to $526 mln, driven by increased global trading volumes and strong activity in corporate derivatives, particularly in Europe and Asia, reflecting Jefferies’ investments in electronic trading and equity derivative platforms. In contrast, Fixed Income net revenue fell 37% to $178 mln, hampered by lower volatility and reduced trading activity in distressed and securitized products amid a challenging bond market environment.
JEFs’ Q2 results paint a mixed picture for the financial sector as Q2 earnings season approaches, with strength in Advisory and Equities offset by Fixed Income weakness and an earnings miss. The company’s optimism for 2H25, fueled by a strong May rebound and a robust M&A pipeline, signals potential upside for JEF and the broader sector, particularly in investment banking.
McCormick is spicing it up with upbeat Q2 report, a nice bounce back after a rare miss in Q1
McCormick (MKC +5%) is spicing it up today following an upbeat Q2 (May) earnings report this morning. This supplier of spices, seasoning mixes, and condiments bounced back nicely from an EPS miss in Q1 (Feb) to report a good-size EPS beat this quarter. Revenue rose 1.0% yr/yr to $1.66 bln, which was in-line. MKC also reaffirmed FY25 guidance.
- MKC operates two segments: Consumer (57% of FY24 revs; 69% of operating income) and Flavor Solutions (43%; 31%), which caters to food manufacturers and food service customers. Its Consumer segment tends to sport better margins than its FS segment. Total organic sales growth in Q2 was +2% driven by volume.
- Its Consumer segment really drove the Q2 results with segment sales up 3% (+3% organic) at $931 mln. There was minimal FX impact with organic growth being driven by volume and product mix. Volume growth in the Americas was strong across core categories and was driven by investments in brand marketing, innovation and category management. In EMEA, Consumer organic sales grew 3%, while organic sales in Asia Pacific grew 4%, reflecting a gradual recovery in China.
- FS segment sales decreased by 1% yr/yr (organic was flat) to $729 mln as demand remains pressured in some areas. MKC said that some of its large CPG (consumer packaged goods) customers continue to experience softness in volumes within their own businesses. MKC is also seeing flat performance in branded foodservice in the Americas as some customers are seeing softness due to a continued slowdown in foot traffic. QSR traffic also remains soft in EMEA.
- In terms of its macro view, consumers are adapting to economic pressures by making more frequent trips to the grocery store with fewer units per basket, choosing larger pack sizes, and increasingly using leftovers. Importantly, they continue to spend and not compromise on flavor. Consumers are cooking at home more as 86% of meal occasions are now sourced at home, which remains above pre-pandemic levels.
Overall, the Q2 results were a nice bounce back following the rare EPS miss last quarter. What really stood out was its Consumer segment, partly fueled by people are eating at home more. MKC has spent more on marketing, which appears to be paying off. MKC also cited a gradual recovery in China, which was good to hear after some rough quarters. Seeing the Consumer segment do well is really key for MKC, because it is the larger segment and it is higher margin. The main problem was its FS segment with slower foot traffic at fast food restaurants. But that does make some sense given that people are eating at home more. Net net this is a positive for MKC.
Micron crushes Q3 expectations and guides higher, but shares languish on sustainability doubts (MU)
Micron (MU) delivered a stellar performance in 3Q25, easily surpassing EPS and revenue expectations, despite macroeconomic headwinds tempering optimism for its consumer-oriented businesses. The outperformance was primarily driven by surging demand for high-bandwidth memory (HBM) chips, fueled by the accelerating adoption of AI infrastructure across data centers. MU’s strategic focus on high-margin HBM products, critical for AI workloads, capitalized on robust demand from cloud service providers and enterprise customers, offsetting sluggishness in traditional PC and smartphone markets.
- MU’s guidance for 4Q25 further underscored its momentum, projecting revenue of $10.7 bln (+/- $300 mln), a 15% sequential increase, and adjusted EPS of $2.50 (+/- $0.15), both significantly above analyst estimates. However, despite this upbeat outlook, MU’s shares are experiencing a muted response, reflecting investor caution about sustaining this growth trajectory. Some of this skepticism stems from concerns over tariff-related pull-ins, as customers may have accelerated orders to preempt potential trade disruptions under new U.S. policies, though MU noted that the impact of these pull-ins was relatively modest and it plans to pass on any tariff-related costs to customers.
- The standout driver of MU’s Q3 performance was its record-high DRAM revenue, propelled by a nearly 50% sequential surge in HBM revenue and a doubling of data center revenue yr/yr, which also hit a quarterly record. The robust demand for HBM chips is directly tied to the AI infrastructure buildout, as these high-performance memory solutions are essential for powering advanced GPUs used in AI model training and inference, particularly for customers like NVIDIA (NVDA) and Advanced Micro Devices (AMD).
- MU’s HBM3E chips, designed for cutting-edge AI and high-performance computing workloads, have seen exceptional traction, with the company reporting that its HBM supply is fully booked for 2025 and already seeing strong demand into 2026. To meet this demand, MU is ramping up production of its 12-high HBM3E chips in early 2025 and plans significant capital investments, including $200 bln over the next 20+ years in U.S. manufacturing and R&D, to bolster its HBM and advanced memory capabilities.
- MU's consumer-oriented businesses, particularly in PCs and smartphones, also showed notable sequential growth, contributing to the company’s broad-based strength in Q3. The Mobile Business Unit posted a 45% sequential revenue increase to $1.6 bln, driven by improving pricing conditions and rising demand for AI-enabled smartphones, which require 12 to 16 GB of DRAM compared to 8 GB in last year’s flagship models.
- Looking to 2025, MU expects low single-digit percentage growth in smartphone unit volumes and a low single-digit percentage increase in PC sales, with AI-enabled devices driving higher memory content per unit, particularly as next-generation AI PCs demand substantially more DRAM.
Despite the robust Q3 earnings beat and strong Q4 guidance, MU’s stock reaction remains subdued, reflecting investor caution about the sustainability of its momentum amid tariff uncertainties and cyclical risks in consumer markets. However, MU’s AI-driven growth potential, particularly in the high-margin HBM segment, is significantly more robust than its consumer-oriented end markets, positioning the company as a key beneficiary of the ongoing AI infrastructure expansion.
Winnebago lower on guidance, hopes for an industry turnaround appear premature
Winnebago (WGO -9.5%) is trading lower following its Q3 (May) report this morning. The RV manufacturer, which produces both towables and motorhomes, reported EPS slightly above analyst expectations, while revenue came roughly in-line.
The company already provided Q3 guidance on June 5, as such, these results were largely anticipated. We suspect investor focus shifted to the remainder of FY25 and any early reads on FY26. Unfortunately, WGO lowered FY25 EPS guidance pretty substantially. Perhaps just as troubling, analysts had asked questions about FY26, but management denied to provide specifics, prompting a negative reaction in the stock.
- WGO continues to see the macroeconomic uncertainty weighing on consumer sentiment and the dealer network. This echoes commentary we heard from industry peer Thor Industries (THO) earlier in June. The sentiment from both companies is that this is a challenging period for the RV industry as a whole.
- WGO's disappointing numbers are more pronounced on the motorhome side, with 2HFY25 revenues expected to be significantly lower. Motorhome RV volume in Q3 declined 14.8% yr/yr and shipments 8.7% yr/yr. WGO cited market conditions and dealers reducing excess inventory.
- In response, WGO is aligning production to demand, reducing field inventory, and reevaluating its manufacturing footprint, which is expected to have a more meaningful impact in FY26.
- It is important to note that WGO did see some relative strength in its marine segment with revenue up 15%. WGO expects its marine segment to show continued momentum. Investors are likely pleased to see the marine segment mitigate problems on the RV side.
Overall, it's clear the RV industry remains in a downturn. Investors who have been hoping for a light at the end of the tunnel look like they have to wait a little longer. WGO reiterated what we heard from THO earlier in June, that it is going to take some time for the market to turnaround. We suspect investors are going to want to see at least some stabilization in the industry before buying back in.
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