MARKET WRAP

After Monday’s session showed signs of rotation from recent winners into lagging sectors, Tuesday’s action was more muddled under the surface, but resulted in a gain for the SPX. Small caps continuing to be the greatest beneficiary the past few days, but the tech heavy Nasdaq also saw nice gains, while of of the true laggards that saw some buying yesterday were weak once again. That left equities with some divergent moves within for the second straight day, but it all adding up to broader based gains today. On the day SPX +0.5%, QQQ +0.7% and IWM +1.3%.

Elsewhere, the US10YY was a tad higher again, while Oil moved higher. DXY was unched. The VIX declined just a tad, but is holding in there, now 16.63. We’ll see how it reacts into the three day weekend following tomorrow’s Jobs Number.

After hours: Following a strong close, both SPY and QQQ are a tick lower after hours.

• MRKT Call: Carter Worth joins Dan to check the charts after yesterday’s rotation to start the new quarter. Also, FactSet’s earnings insight, an upgrade for Apple, the Vietnam trade deal, Tesla deliveries and more.

• RiskReversal Pod: Dan welcomes Wilfred Frost of Sky News and 'Master Investor' podcast and 'David Frost Versus to discuss global financial markets, the US dollar's performance, and America's evolving trade policies.

MRKT MATRIX: TODAY’S TOP STORIES

• S&P 500 hits new record as Trump announces Vietnam trade deal, gains limited by weak jobs data (CNBC)

• The private sector lost 33,000 jobs in June, badly missing expectations for a 100,000 increase, ADP says (CNBC)

• Tesla’s Global Vehicle Deliveries Plunged in Second Quarter (WSJ)

• Foxconn Pulls Chinese Staff From India in Hurdle for Apple (Bloomberg)

• Trump’s 35% Tariff Threat Feeds Japan’s Worst-Case Scenario (Bloomberg)

• Private Equity Is Struggling to Overcome Doubts on Valuations (Bloomberg)

• China Is Quickly Eroding America’s Lead in the Global AI Race (WSJ)

• Figma files for IPO on NYSE, plans to ‘take big swings’ with acquisitions (CNBC)

WHAT’S NEXT?

In a little bit of a twist that slightly complicates yesterday’s narratives, the Nasdaq and Russell 2000 joined forces to lead the way today in equities, while other areas, which were clear beneficiaries of investor rotation yesterday, were more mixed today.

As noted, small caps outperformed again today — even as the 10-year Treasury yield ticked slightly higher — reinforcing the idea that capital is rotating into areas of the market still viewed as having room to run. That strength in the Russell, paired with continued resilience in tech today (e.g. NVDA +2,5%), suggests this isn’t yet a broad-based profit-taking moment from the market’s April rally leaders, but more a search for leverage and upside in pockets that have yet to see highs. Money isn’t leaving the table — it’s just being reshuffled slightly thus far.

Tesla jumped +5% despite reporting another drop in vehicle deliveries. On the flip side, Dow component UnitedHealth (UNH) reversed, giving up all of Monday’s gains and then some. As we approach the holiday, today’s price action reinforces the bullish sentiment, but one that’s likely seeing some beginning of the quarter jockeying, as well as some light holiday week trading.

The other big story today was the ADP Employment miss. Tomorrow’s NFP Jobs number becomes more important as a large miss there would certainly bring the possibility of a July rate cut back into play, but for the overall economy, at what cost?

• Thursday Jul 3rd

  • 8:30am - Non Farm Payrolls

  • 10am - ISM Services PMI

  • Markets Close at 1pm

  SPX Expected Move: 0.6%

Most mentioned on the socials today: $TSLA, $SPY, $HOOD, $AAPL, $PLTR, $MSTR, $QQQ, $UNH, $AMD

TODAY’S EPISODES

Watch MRKT Call’s newest episode: Carter Worth Charts $AAPL After Jefferies Upgrade

• FactSet Earnings Insight: SPX Bottom up target price vs Closing price

• Call of the Day: Jeffries upgrades AAPL

• Analysis: SPX, S&P e-mini, SPY, IWM, KRE, Dollar, AAPL, TSLA, NKE

Learn more about our sponsor, CME Group.

Watch RiskReversal Podcast’s newest episode: Wilfred Fr The Battle For Global Influence In Markets & Politics

Dan welcomes Wilfred Frost, an anchor on Sky News Breakfast Show and contributor to MSNBC, CNBC, and NBC News. The discussion covers Wilfred's recent move back to London, his ongoing projects, including the 'Master Investor' podcast and 'David Frost Versus,' a show based on the renowned interviews conducted by his father, David Frost. They delve into the cultural differences between the UK and the US in terms of business success, the economic impacts of Brexit, and the UK's future trade deals. The conversation also touches on global financial markets, the US dollar's performance, and America's evolving trade policies. Wilfred shares insights into the preservation and celebration of his father's legacy through various media projects.

Learn more about our sponsor Betterment and iConnections.

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