MARKET WRAP

A strong performance for equities today with the SPX attempting to break out from its recent consolidation. The all time highs are now less than 3% away. Nvidia helped lead tech and has made up the entirety of its post earnings reversal. Treasury yields were quiet, while the dollar managed a small bounce. On the day SPX +0.6%, QQQ +0.7 and IWM +1.6%. DXY was up +0.6% and is back to $99.27. The US10YY was flat, Oil added to yesterday’s move higher

The VIX is back below 18 and traders aren’t showing much concern as we enter what is likely to be quite a bit of trade negotiation news.

After hours: CRWD is lower by about -7%, HPE is higher by about +3.5% on earnings, SPY is down about 50c from its close.

• MRKT Call: US stocks vs International. An upgrade for Pinterest. Thoughts solar, Energy, Reddit, CoreWeave, Dollar General, Lululemon and more.

• RiskReversal Pod: Dan welcomes Mike Dempsey of ⁠Compound VC⁠ to discuss the firm's approach to investing in disruptive tech, including generative AI and autonomy.

MRKT MATRIX: TODAY’S TOP STORIES

• S&P 500 rises, led by Nvidia and chip stocks (CNBC)

• Trump Tariffs Are Hurting US and Global Economy, OECD Warns (Bloomberg)

• Wall Street Games Out How to Profit From Trump Tariff Flip-Flops (Bloomberg)

• Trump Presses Reluctant GOP Senators to Embrace House Tax Bill (Bloomberg)

• Meta to Buy Nuclear Power From Constellation as AI Demand Soars (Bloomberg)

• Wall Street Is Sounding the Alarm on U.S. Debt. This Time, It’s Worth Listening (WSJ)

• ‘Big Short’ investor Steve Eisman” Tariffs are my only concern (CNBC)

• Dollar’s correlation with Treasury yields breaks down (Financial Times)

• China’s New Trade Negotiator Is Ready to Play Hardball (WSJ)

• Walmart is supercharging revenue - but with fewer workers (Financial Times)

• Klarna takes on banks with debit card as it diversifies beyond buy now, pay later (CNBC)

WHAT’S NEXT?

The grind higher continued today, pushing stocks further into rebound territory and solidifying the impressive V-shaped recovery since early April. SPX not only climbed and held throughout the session but also closed above its March 19th highs, marking another technical milestone in an attempt to retake all time highs The index now sits less than 3% away from those all-time high set back in February.

On the volatility front, expectations for a failure from this recent consolidation have mostly faded. The VIX slipped back below 18. Traders appear more comfortable leaning into the grind higher rather than bracing for any immediate pullback. The volatility backdrop assumes if the news turned negative there’d be time to adjust. Helping pave the way today was a relatively quiet backdrop elsewhere. Although oil extended its recent move higher, treasury yields were quiet, while the dollar saw a modest rebound (although still near recent lows). Stable days in treasuries and the dollar tend to give equities room to breathe.

More potential catalysts tomorrow with ADP in the morning and Beige Book in the afternoon. We may also hear news of trade negotiation proposals.

• Wednesday, June 4th

  • Pre-market: DLTR 9%

  • 8:15am - ADP Employment

  • 10am - ISM Services

  • 2pm - Fed Beige Book

  • After Hours: MDB 13%

TODAY’S EPISODES

Watch MRKT Call’s newest episode: Global Growth Concerns Weigh On Equities

• Call of the Day: JPM upgrade on Pinterest (PINS)

• Analysis: SPX, IEV, EWC, EWW, VIX, PINS, RDDT, CRWV, CEG, FSLR, DG, LULU, 

• Your Questions Answered:

  • Thoughts on Constellation Energy?

  • Is the worst over for solar?

Learn more about our sponsor, FactSet.

Watch RiskReversal Podcast’s newest episode: Agentic Disruption & The Race For Robotaxi Supremacy with Mike Dempsey of Compound VC

Mike shares his background from hedge funds to early-stage investing, detailing Compound's research-centric strategy in identifying undervalued tech opportunities. The conversation covers broader market trends, the evolution of AI and its impact on public companies, and the dynamic between private and public investing. They also delve into specific investments like Wave, an autonomous driving tech startup, and potential market impacts from major players like Tesla, Waymo, and emerging competitors.

Timecodes 0:00 - Intro 5:00 - Public Market Angle 17:00 - Google 21:15 - Chatbot Wars 27:35 - Apple 32:00 - Perplexity + M&A Outlook 37:15 - Autonomy 49:30 - Robotaxi Wars

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