Market Snapshot
| Dow | 44484.42 | -10.52 | (-0.02%) | | Nasdaq | 20393.14 | +190.24 | (0.94%) | | SP 500 | 6227.42 | +29.41 | (0.47%) | | 10-yr Note |
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| | NYSE | Adv 2044 | Dec 742 | Vol 1.20 bln | | Nasdaq | Adv 3037 | Dec 1462 | Vol 8.43 bln |
Industry Watch
| Strong: Technology, Materials, Consumer Discretionary, Energy |
| | Weak: Utilities, Health Care |
Moving the Market
Market awaits the fate of large reconciliation bill
Negative ADP Employment Change Report for June with more comprehensive employment data to be released tomorrow
President Trump announces trade deal with Vietnam
| Stock Market Summary
02-Jul-25 16:30 ET
Dow -10.52 at 44484.42, Nasdaq +190.24 at 20393.14, S&P +29.41 at 6227.42
[BRIEFING.COM] The S&P 500 closed at a new record high today, enjoying a steady ride higher throughout today's session despite a disappointing ADP Employment Change Report, which showed a loss of 33,000 jobs for private-sector payrolls in June. That news was overshadowed by the president announcing a trade deal with Vietnam that includes a zero tariff rate for U.S. access to Vietnamese markets, solid gains in several mega-cap stocks, and ongoing leadership in the small-cap and mid-cap spaces.
Tesla (TSLA 315.65, +14.94, +4.97%), which reported better-than-feared Q2 delivery numbers; Apple (AAPL 212.44, +4.62, +2.22%), which was upgraded to Hold from Underperform at Jefferies; and NVIDIA (NVDA 157.25, +3.95, +2.58%) and Alphabet (GOOG 179.76, +2.85, +1.61%), which were riding AI-related momentum, were the mega-cap leaders.
Their influence underpinned the market cap-weighted S&P 500 (+0.5%), which had a solid outing but nonetheless found itself looking up again at the Russell 2000 (+1.3%) and S&P Midcap 400 Index (+1.0%), which remained beneficiaries of rotational interest.
Like yesterday, today's buying interest was broad-based. Advancers led decliners by a better than 2-to-1 margin at the NYSE and Nasdaq.
The advancers did not include health insurer Centene (CNC 33.78, -22.86, -40.37%), which got pummeled after withdrawing its guidance following its first view analysis of 2025 industry Health Insurance Marketplace data from Wakely. Centene expects an adjusted diluted EPS impact of approximately $2.75 for FY25 based on the analysis. Other health insurance stocks traded lower in sympathy and were the drivers of the health care sector's (-1.0%) underperformance.
The financials sector (-0.1%) also trailed today's action, even though many of the nation's largest banks announced plans to increase their dividend and/or repurchase stock after passing the Federal Reserve's annual stress test.
Today's best-performing sectors were the energy (+1.7%), materials (+1.3%), and information technology (+1.3%) sectors.
Turning back to the ADP report, it was a disappointment, but market participants reserved judgment on its meaning, cognizant that they will get a more comprehensive view of the labor market with the release of the June Employment Situation Report before Thursday's open and that the ADP data doesn't always move in line with the government's data.
Speaking of the government, the "One Big, Beautiful Bill" remained stuck in the House, with some press reports suggesting there is dissension in the GOP ranks over its cost, holding up its passage. There is still a prevailing view that the bill will pass, even though its passage might be delayed beyond the president's wish to have it on his desk for signing by July 4.
As a reminder, the stock market will close at 1:00 p.m. ET Thursday in advance of the Independence Day holiday on Friday.
- S&P 500 +5.9% YTD
- Nasdaq: +5.6% YTD
- DJIA: +4.6% YTD
- S&P 400: +1.6% YTD
- Russell 2000: -0.2% YTD
Stock market poised for positive finish
02-Jul-25 15:30 ET
Dow -25.01 at 44469.93, Nasdaq +171.28 at 20374.18, S&P +23.98 at 6221.99
[BRIEFING.COM] The stock market is on track for a positive finish as the S&P 500 (+0.4%) continues to sit near its highs for the day.
The technology sector (+1.1%) has rebounded from yesterday's losses, and recently benefitted from a Bloomberg report that Oracle (ORCL 226.87, +7.91, +3.61%) and Open AI have expanded their Stargate initiative to develop more data processing centers for AI projects.
U.S. Treasuries saw some curve-steepening today, with longer-dated securities underperforming shorter-dated securities. Yields rose across the curve, which might have been surprising to some given that the ADP Employment Change Report for June showed a loss of 33,000 jobs from private-sector payrolls. Market participants, though, seemed to be reserving judgment on the labor market until they get a glimpse of the more comprehensive Employment Situation Report for June, which will be released before Thursday's open.
Small-cap and mid-cap stocks continue to outperform
02-Jul-25 15:00 ET
Dow -28.12 at 44466.82, Nasdaq +162.39 at 20365.29, S&P +23.03 at 6221.04
[BRIEFING.COM] The S&P 500 is at its best level of the day, currently up 0.4%, supported by some rebound activity in the mega-cap space that has been led by Apple (AAPL 212.18, +4.36, +2.10%) Alphabet (GOOG 179.51, +2.60, +1.47%) and Tesla (TSLA 315.42, +14.71, +4.89%).
The other important tale of the tape though, is that the small-cap and mid-cap stocks continue to outperform. The Russell 2000 is up 1.1% and the S&P Mid Cap 400 is up 0.8%.
Within the S&P 500 six sectors trade in the green as the market enters the final hour of trading. Information technology (+1.0%) and consumer discretionary (+0.9%) are rebounding from yesterday's poor performance, and are among today's best performing sectors. Other notable gainers include the energy (+1.5%) and materials (+1.1%) sectors.
S&P 500 climbs behind big gains in FSLR, MRNA, ALB; MOH tumbles on Medicaid margin fears
02-Jul-25 14:25 ET
Dow -35.74 at 44459.20, Nasdaq +164.25 at 20367.15, S&P +20.42 at 6218.43
[BRIEFING.COM] The S&P 500 (+0.33%) is firmly in second place on Wednesday afternoon.
Briefly, S&P 500 constituents Albemarle (ALB 68.03, +5.13, +8.16%), First Solar (FSLR 175.62, +12.66, +7.77%), and Moderna (MRNA 30.38, +1.69, +5.89%) pepper the top of the standings. FSLR rallies after the Senate removed a controversial excise tax from the GOP's sweeping tax package, a provision that had threatened clean energy economics. For its part, MRNA hit a three-month high after the company reported strong Phase 3 results for its experimental mRNA flu vaccine, showing significantly higher efficacy than currently approved options in older adults. Investor optimism also grew around the potential for a future flu-COVID combo shot, despite regulatory uncertainty under HHS Secretary RFK Jr.
Meanwhile, Molina Healthcare (MOH 245.27, -61.02, -19.92%) is down hard, a likely spillover effect from Centene's (CNC 34.51, -22.14, -39.08%) surprise guidance withdrawal, which reignited fears about structural profitability issues in the ACA and Medicaid segments -- both core to Molina's revenue base.
Gold edges higher as rate cut bets, fiscal worries, and trade tensions fuel safe-haven demand
02-Jul-25 14:00 ET
Dow -47.50 at 44447.44, Nasdaq +164.17 at 20367.07, S&P +20.27 at 6218.28
[BRIEFING.COM] The tech-heavy Nasdaq Composite (+0.81%) is modestly higher, yet firmly atop the major averages with about two hours remaining on Wednesday afternoon.
Gold futures settled $9.90 higher (+0.3%) at $3,359.70/oz, in response to a mix of macroeconomic uncertainties. The U.S. dollar hovered near multi-year lows amid market speculation around Federal Reserve timing on rate cuts, Chair Powell's "wait-and-learn" tone and cooling U.S. jobs data have emboldened safe-haven bullion. Simultaneously, U.S. fiscal dynamics -- specifically, Senate passage of a sizeable tax-cut and spending bill adding approximately $3.3 trillion to national debt -- are adding inflation and debt-financing risk, which tends to support gold's appeal. Finally, mounting trade tensions, particularly as the July 9 tariff deadline looms and negotiations remain clouded, have further underpinned demand for the metal.
Meanwhile, the U.S. Dollar Index is up +0.1% to $96.78.
Intel dives on report of chip maker possibly scrapping 18A process, clouding turnaround plan (INTC)
Intel (INTC) is trading sharply lower following a Reuters report indicating that new CEO Lip-Bu Tan is considering significant changes to its contract manufacturing business, adding further uncertainty to the company’s already challenged turnaround plan. According to the report, Tan is exploring the possibility of abandoning external sales of the 18A manufacturing process, a cornerstone of former CEO Pat Gelsinger’s strategy to position INTC as a competitive foundry against Taiwan Semiconductor Manufacturing (TSM).
- INTC has dismissed the Reuters report as “hypothetical scenarios or market speculation,” asserting that its lead customer for 18A remains Intel itself, with plans to ramp up production of its Panther Lake laptop chips later in 2025. However, investors are unwilling to give INTC the benefit of the doubt, given the company’s prolonged struggles, including significant market share losses in data centers and PCs, painful stock declines, and persistent financial losses in its foundry business, which reported a $13.4 bln loss in 2024.
- The market’s skepticism is compounded by INTC’s history of execution challenges and a bureaucratic culture that has hindered its ability to capitalize on the AI-driven semiconductor boom, leading to a sharp sell-off as investors question the company’s strategic direction under Tan.
- Since succeeding Gelsinger in March 2025, Lip-Bu Tan has moved swiftly to address INTC’s financial and operational inefficiencies through aggressive cost-cutting measures. Notable actions include laying off 15,000 employees in August 2024, with further reductions targeting middle management to streamline operations, and divesting non-core assets such as part of its Altera stake. Up until the Reuters report, Tan had publicly supported Gelsinger’s 18A strategy, emphasizing its role in upcoming products like Panther Lake and Clearwater Forest, while advocating for a more measured pace of foundry expansion to preserve cash. This cautious approach was evident in INTC’s decision to delay fabrication plant completions in Ohio and Germany, reflecting Tan’s focus on aligning capital expenditures with market demand.
- INTC has two significant chip releases planned using the 18A process: Panther Lake, a next-generation laptop chip with AI capabilities set for launch in 2H25, and Clearwater Forest, a server CPU slated for 1H26. A move away from marketing 18A to external foundry customers could disrupt these launches by limiting economies of scale and reducing the process’s strategic importance, potentially forcing INTC to reallocate resources to redesign chips for alternative nodes like 14A.
- While INTC has stated it will continue using 18A for in-house chips and committed to external customers like Amazon (AMZN) and Microsoft (MSFT), abandoning broader 18A foundry sales could signal a lack of confidence in the process’s competitiveness, particularly as it reportedly lags TSM’s N2 technology.
- In response to 18A’s challenges, Tan is reportedly considering steering foundry customers toward INTC’s 14A process, a next-generation node expected to offer advantages over TSM’s comparable technologies, potentially positioning INTC to better compete for major clients like Apple (AAPL) and Nvidia (NVDA). The 14A process promises a 15-20% performance-per-watt improvement over 18A, with a design tailored to meet external customer needs from the ground up, unlike 18A, which was initially developed for INTC’s internal use.
The Reuters report introduces significant uncertainty and doubt surrounding INTC’s turnaround efforts and the viability of its 18A process, which was intended to be a linchpin in reestablishing the company as a leading foundry and semiconductor innovator. While Tan’s aggressive cost-cutting and potential pivot to 14A signal a pragmatic approach to addressing INTC’s challenges, the prospect of a costly 18A write-off and ongoing struggles to secure foundry customers highlight the steep road ahead for Intel’s recovery.
Greenbrier Companies surging today after substantial EPS beat and optimism for Q4 and FY26
Greenbrier Companies (GBX +19%) is trading sharply higher after releasing its Q3 (May) results. While there were only two estimates, the company reported well ahead of analyst expectations. This supplier of freight railcars and marine barges can have varying results quarter to quarter; however, Q3 marked a return to upside reporting in both EPS and revs on a sequential and yr/yr basis. As such, investors are buying back into the stock after Q2 (Feb) showed worrying signs about the macro environment.
- While revenue was up only 2.7% yr/yr, it was up 11% sequentially to $842.7 mln and remains on track to achieve revenue guidance for FY25. GBX delivered 5,600 new railcars in Q3 with manufacturing gross margin remaining steady at 13.6%.
- Fleet utilization remained high at 98%, with the lease fleet growing modestly from the prior quarter, reflecting opportunistic additions and a strategic approach giving the macro backdrop.
- GBX's global new railcar backlog remains healthy at nearly 19,000 units, which supports its revenue outlook. Management also expressed confidence in demand for the back half of the year and into FY26, noting that the sales pipeline and inquiry levels are "definitely up."
- An important note on the backlog: management stated that several thousand additional railcars, as many as 3,000, are not included in the figure, as they are a part of railcar restoration activity. Restoration is a big part of GBX's production and given that it is not included in an already healthy backlog, is another good sign for GBX.
- What's exciting investors are the catalysts GBX sees to help boost demand heading into FY26. The near completion of its insourcing capacity expansion in Mexico is expected to deliver its full value as production scales through FY26.
- Additionally, the budget bill passed yesterday includes tax policy that management believes will energize markets for capital goods, such as railcars. Management also expects the 45Z renewable fuels bill to drive demand due to its benefits in the ethanol and soybean crush sectors.
Overall, it was a nice bounce back quarter for GBX after it saw some selling action following its Q2 report. The strong backlog shows management is confident in its near-term outlook. Shares were trading flat around $45 over the last month, so the big bump today shows investors are confident about the improvements from Q2 and the catalysts that GBX sees going into its final quarter of the fiscal year.
Centene withdraws guidance; makes us nervous for healthcare this earnings season (CNC)
Centene (CNC -39%) is under heavy pressure today after announcing last night it is withdrawing its prior FY25 EPS guidance, including the underlying guidance elements. Its decision was based on its recent review of 2025 industry Health Insurance Marketplace (Marketplace) data from Wakely, an independent actuarial firm. The data was relevant to Centene since it covered 22 of Centene's 29 Marketplace states, and it represented 72% of the company's Marketplace membership.
- Basically, the data showed that the overall market growth in the 22 states is lower than expected. In addition, the implied aggregate market morbidity in those states is significantly higher than, and materially inconsistent with, the company's assumptions for risk adjustment revenue transfer. Centene's analysis of the 22 states results in a reduction to its previous full year net risk adjustment revenue transfer expectation by ~$1.8 bln which corresponds to an adjusted EPS impact of ~$2.75.
- That is quite a significant change from prior expectations and that results in a huge impact on the financial performance of this managed care organization, which primarily focuses on Medicaid and Obamacare insurance marketplaces.
- The company says its Medicaid business has already experienced a step-up in the medical cost trend in behavioral health, home health and high-cost drugs. And this was especially the case in specific geographies, such as New York and Florida. Accordingly, CNC expects Q2 Medicaid Health Benefits Ratio (HBR) to be higher than Q1.The silver lining for Centene was that the final 2024 risk adjustment results released by Centers for Medicare and Medicaid Services (CMS) yesterday were in line with expectations.
It has been a rough few months for healthcare stocks. Of course, there is the slowing of growth in Medicaid funding as part of the tax bill working its way through Congress. But it's not just that. They have been dealing with higher costs and President Trump talking about drug price reductions. Also, this guidance follows the announcement in mid-May from United Healthcare (UNH) that it suspended guidance and its CEO stepped down at the same time.
These recent developments make us nervous for healthcare stocks in general as we head into earnings season in a few weeks. Not only with the tax bill likely be wrapped up by then and the corresponding spending reductions will be final, but these companies are dealing with higher costs and sluggish enrollment. And what makes the Centene news more concerning is that it just outright withdrew guidance, which scares investors even more than a reduction. This tells us that CNC itself does not really know what to expect for the balance of the year.
Constellation Brands misses the mark on Q1 results, but reaffirmed outlook eases concerns (STZ)
Constellation Brands (STZ) reported 1Q26 earnings that missed consensus expectations, marking the second EPS shortfall in three quarters, while net sales declined 5.5% yr/yr to $2.52 bln, the steepest drop since 4Q23. This underperformance was anticipated by the market, reflected in a 17% stock decline since mid-May, driven by mounting concerns over weakening demand in the Beer segment, particularly among its core Hispanic customer base grappling with intensifying economic pressures such as higher costs for essentials like food and gas. These pressures, combined with increased aluminum tariffs, have weighed heavily on investor sentiment, setting low expectations for the quarter.
Despite the earnings miss, STZ reaffirmed its FY26 guidance, projecting comparable EPS of $12.60–$12.90 and enterprise organic net sales growth of (2.0) to 1%, alleviating fears of a downward revision. This reaffirmation, coupled with the market’s subdued expectations, has fueled a modest post-earnings stock rally. Management’s confidence in achieving these targets hinges on expected sequential improvements in 2H26, particularly in the Beer segment, supported by cost-saving initiatives and anticipated macroeconomic tailwinds such as potential Fed rate cuts.
- The Beer segment, which accounts for the lion’s share of revenue with brands like Modelo Especial and Corona Extra, faced significant challenges, reporting a depletion decline of 2.6%, a deterioration from the prior quarter’s 1.0% drop, with net sales falling 2% to $2.23 bln. Key pressures include subdued consumer spending and value-seeking behavior, particularly in top sales states and zip codes with larger Hispanic populations, who represent roughly 50% of the Beer business and are increasingly strained by economic factors like inflation and rising unemployment.
- Additionally, higher aluminum tariffs and elevated marketing expenditures further eroded operating margins, which contracted 150 bps to 39.1%, though the segment’s profitability remains robust compared to industry peers.
- The Wine & Spirits segment continued its volatile performance, with depletions down 8.1% and organic net sales plunging 21% to $280.5 mln, while operating margins swung to a loss of 2.1% from a prior-year profit of 15.3%. This downturn, driven by a $36 mln sales hit from divestitures, $53 mln from volume declines, and $19 mln from negative price/mix, contrasts sharply with the segment’s 11% organic net sales growth in 4Q24, highlighting its inability to sustain recent momentum.
- The segment’s ongoing premiumization transformation, marked by divestitures of mainstream brands like SVEDKA and a focus on higher-end offerings such as Kim Crawford and The Prisoner, has yet to stabilize, with lower contractual distributor payments and volume-related adverse variances offsetting marketing and SG&A efficiencies. Management remains optimistic about sequential improvements in 2H26, citing early signs of traction in premium brands, but the segment’s perpetual turnaround mode underscores persistent execution risks.
STZ’s Q1 results and reaffirmed FY26 guidance are being viewed as better-than-feared, sparking a modest stock rebound as investors take comfort in the absence of a guidance cut. However, the results were undeniably soft, with both the Beer and Wine & Spirits segments facing significant headwinds from economic pressures and portfolio transitions, suggesting that sustained recovery will depend on improved consumer sentiment and successful execution of the premiumization strategy.
General Motors speeds higher as Q2 U.S. sales jump 7%, fueled by record EV and crossover demand (GM)
General Motors (GM) is rallying sharply higher after releasing its 2Q25 sales report, which showcased a robust 7% yr/yr sales increase, totaling approximately 746,588 vehicles. This performance underscores GM’s resilience in a challenging automotive market, driven by strong product execution and sustained customer demand across its diverse portfolio of internal combustion engine (ICE) vehicles and electric vehicles (EVs). The company also maintained consistent pricing and low incentives despite macroeconomic uncertainties and potential tariff concerns.
- The Chevrolet brand, GM’s volume leader, posted a 6% sales increase in Q2, driven by record-breaking crossover and EV sales that reinforced its position as a market favorite. The Chevrolet Equinox, encompassing both ICE and EV variants, achieved its best-ever sales quarter, with the Equinox EV alone moving 17,420 units, a standout performance in its first full year on the market. The Chevrolet Trax continued its upward trajectory, with sales momentum from its affordable subcompact SUV positioning, following an 84% annual increase in 2024 to 200,689 units. The Chevrolet Traverse also saw strong demand, driven by its redesigned 2024 model, indicating sustained consumer interest into Q2.
- GM’s electric vehicle segment was a standout, with EV sales surging 111% yr/yr to 46,280 units in Q2, securing a 16% U.S. EV market share and solidifying GM’s position as the second-largest EV manufacturer behind Tesla (TSLA). The Chevrolet Equinox EV led the charge as GM’s top-selling EV, followed closely by the Chevrolet Blazer EV with approximately 8,000 units sold. The Cadillac Lyriq also contributed significantly, with around 5,000 units sold, maintaining its status as the best-selling electric mid-size luxury SUV.
- These models, built on GM’s Ultium battery platform, have resonated with consumers seeking affordable and luxury EV options, with the Equinox EV’s sub-$35,000 starting price (before potential tariffs) broadening its appeal. GM’s EV growth, nearly doubling its market share from a year ago, reflects its strategic push toward electrification despite looming policy uncertainties.
- GMC and Buick also delivered impressive results, with GMC posting 6% sales growth in Q2, fueled by strong performances from the redesigned GMC Acadia, the Sierra pickup, and the Yukon SUV. Buick achieved a remarkable 19% sales growth, driven by the Buick Enclave, which saw a 46% sales increase in the first half of 2025, building on its 2024 momentum as consumers gravitated towards the Enclave’s redesigned appeal and competitive pricing.
GM’s Q2 U.S. sales performance reflects the company’s robust product lineup and strategic execution in a challenging business environment. Strong demand for models like the Chevrolet Equinox, Trax, Traverse, GMC Acadia, Sierra, Yukon, and Buick Enclave, alongside a 111% surge in EV sales, positions GM for continued growth, provided it navigates potential tariff and policy headwinds effectively.
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