Jun 13, 2025
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“Being Irish, he had an abiding sense of tragedy, which sustained him through temporary periods of joy.” – WB Yeats
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
If you were planning on a slow summer Friday, renewed tensions in the Middle East have damaged those plans this morning. Equity futures are off their overnight lows, but the S&P 500 is still indicated to open down by about 1%. The real action is obviously in the energy markets as crude oil trades sharply higher.
The US Oil Fund ETF (USO) is trading up over 7.5% in the pre-market, which would put it on pace for the sixth-largest opening gap to the upside since the ETF’s inception in 2006. It would also be just the 24th time that USO gapped up over 5%. In terms of the prior 7.5% gaps higher, USO continued higher from the open to close for a median gain of 2.1% and positive returns four out of five times. However, by the close of the following day, USO was down a median of 1.6% from the initial gap higher with declines three out of five times, and a week after that opening gap, it was down four out of five times for a median decline of 2.2%. Historically, at least, these sharp gaps higher haven’t had a lot of follow-through.
As far as the price of oil is concerned, this morning’s gap higher has helped to confirm what was already a break of the downtrend that had been in place since mid-January. It also cleared what could have been a formidable level of resistance in the $75 range.
As luck would have it, today is also Friday the 13th, and while the day has unlucky connotations, in terms of market performance, it has been anything but. Since its launch in 1993, the S&P 500 ETF’s (SPY) average daily change has been a gain of 3.9 bps, with gains 53.6% of the time. Fridays, however, haven’t been as positive as SPY’s average performance is unchanged, with gains 52.1% of the time. On the 53 prior Friday the 13ths, though, SPY’s median gain was 20 bps with gains 60% of the time, and on the four prior times that there has been a Friday the 13th in June, SPY’s median gain was 57 bps with gains three out of four times. Will investors buy the dip again and keep the positive June Friday the 13th vibes going?
Jun 12, 2025
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“I will never apologize for the United States of America. Ever. I don’t care what the facts are.” – George H.W. Bush
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
After some modest losses on Wednesday, US equity markets remain weak this morning as S&P 500 and Nasdaq futures are indicated to open down by about 0.5%. In comparison, the Dow is even weaker with declines of about 0.70%. The added weakness in the Dow stems from an 8%+ decline in Boeing (BA) following news of an Air India 787 crash shortly after takeoff. Whether the tragedy was a Boeing issue is far from certain, but given the company’s troubles over recent years, investors aren’t waiting for details over what happened.
After yesterday’s weaker-than-expected CPI, investors are now focused on the May PPI and weekly jobless claims. PPI came in weaker than expected, but more concerning was jobless claims. Initial claims came in at 248K which was unchanged from last week’s revised reading and was the highest level since last October. Continuing Claims were more concerning as they shot up to 1.956 million and was the highest level since 2021. In response, equity futures have seen little in the way of moves, but yields have moved lower.
Investor sentiment has improved as stocks have recovered in the last several weeks, but based on the results of the AAII weekly sentiment survey, complacency has yet to set in. In this week’s survey, bullish sentiment improved from 32.7% to 36.7%, which is hardly an elevated reading. At the other end of the spectrum, just over a third of investors are still bearish (33.6%)/
In looking at the 52-week high list the last couple of days, we thought we stepped into a time machine seeing IBM on the list. The stock broke above resistance last week and continued to run higher all week, consistently closing higher than it opened.
With the gains this week, yesterday was IBM’s 9th straight day of trading higher. A nine-day streak may not sound all that impressive, but over the last 50 years, there have only been seven other streaks of nine or more days. Strangely enough, though, of the now eight streaks of nine or more positive days in a row, four have occurred in the last two years, while the prior 48 only had four!
The chart below shows where each of the prior streaks occurred on IBM’s historical chart. While two of the streaks were followed by steep declines in the days, weeks, months, and even years ahead, these streaks haven’t been indicative of any definitive forward trend.
Jun 11, 2025
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“Too many people miss the silver lining because they’re expecting gold.” – Maurice Sendak
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
There have been some positive developments in the US-China trade talks as Commerce Secretary Howard Lutnick said that both parties agreed to a consensus in trade talks that now only have to be agreed upon by President Trump and Xi. The President just truthed that the deal is ‘done’. Despite the positive headlines, futures have been drifting lower as the terms of the deal really only bring us back to where we were after the Geneva meeting, so this drama is anything but done, even if things are moving in the right direction.
Markets are also a bit anxious heading into the release of the May CPI report. Will this be the month that the impact of tariffs starts to show up in the data, or will we once again hear that it’s a ‘next month’ story?
The S&P 500 closed within 2% of an all-time high yesterday, and overall breadth has likewise been strong. Let’s start with the cumulative advance/decline. The S&P 500’s cumulative A/D line has already hit a new high since “Liberation Day”, and after a brief dip in late May, it has rebounded right back within a hair of its high. If the market takes out its February high, it would be good to see breadth confirming the move.
One big contributor to the strong breadth in the market is the Technology sector, which has already taken out its late May high in the last few days, reaching a new high yesterday.
While the S&P 500 and Technology have seen new highs in terms of breadth as they wait for new highs in price to follow, the Industrials sector has been the opposite, as price has already made a new high, while breadth remains just shy. Back in late May, the sector’s cumulative A/D line just barely missed making a new high, and after a brief dip in late May, is now back on the rebound as it looks to take out those highs once again.
Jun 10, 2025
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“Too many people miss the silver lining because they’re expecting gold.” – Maurice Sendak
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
We’re not sure if it’s the summer doldrums setting in early or that investors needed a breather after the craziness of the last several months, but for the second morning in a row, the action in futures has been quiet. This morning, S&P 500 futures have been moving on either side of the unchanged line while the Nasdaq is set to open slightly higher.
US and Chinese officials are in London again this morning for the second day of trade talks, and the economic calendar is quiet with NFIB Small Business Sentiment being today’s only report. That came in better than expected, rising from 95.8 to 98.8 in May. Overnight, in Asia, Australia and Japan were higher while Hong Kong and China declined.
When it comes to the mega-cap stocks in the S&P 500 with market caps of more than or around a trillion dollars, an increasingly evident trend is that the group no longer trades as a block, where each member’s performance is no longer in line with the others. This can be seen in the year-to-date performance of the nine stocks listed below. While the average performance of the nine stocks on a YTD basis is basically unchanged (-0.01%) and the median is a gain of 5.37%, the performance of each stock ranges from 18.5% (Meta Platforms-META) to a decline of 23.6% (Tesla–TSLA). Even over the last 12 months, while all nine stocks have experienced positive returns, the magnitude of the gains ranges from 4.3% for Apple (AAPL) to a gain of 69.6% for Broadcom (AVGO). Even with every stock trading higher, they have hardly traded in unison.
Where we have seen a group of stocks trade much more in unison is at the other end of the market cap scale. The table below shows the nine stocks in the S&P 500 with the smallest market caps and how each has performed YTD and over the last 12 months. On a YTD basis, all nine stocks are lower with an average decline of 20.7% (median: -19.35). Just as notable is that the range of returns has been much closer than the largest stocks in the S&P 500. Whereas more than 42 percentage points separates the best and worst performances of the nine largest stocks in the S&P 500, for the nine stocks with the smallest market caps, the spread is just 23 percentage points. So, while the rising tide hasn’t impacted each of the nine largest stocks equally, the nine smallest stocks have been weighed down by a more similar anchor.
In terms of performance, while there may have been some concerns over the performance of the mega-cap stocks in recent months, they’re still doing much better than the nine smallest stocks.
Even on a relative strength basis, the nine stocks with the smallest market caps in the S&P 500 have consistently underperformed. Earlier this month, they even made a new low relative to the mega caps.
Jun 9, 2025
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“If I have to go around telling everyone how great I am, then there’s something wrong with my act.” – Les Paul
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
It’s a generally quiet morning in markets ahead of what could be a busy day, depending on how a trifecta of potential catalysts play out. First, US-China trade talks will resume in London in London, and then we could also get an update from the Senate with its version of the reconciliation bill and what changes it made to the House’s version. To round out the trifecta, Apple (AAPL) will be holding its annual Worldwide Developer Conference (WWDC). In last Wednesday’s Chart of the Day, we looked at how the stock typically performs leading up to and after the conference, so make sure to check that out, if you haven’t yet.
The S&P 500 closed above 6,000 for the first time since 2/21, and with a gain of just over 2%, it’s firmly back into positive territory for the year. Overall breadth on the year has also been strong as eight sectors are up YTD, and just three – Consumer Discretionary (-6.8%), Energy (-3.4%), and Health Care (-2.6%) are in the red. The only other sector that’s underperforming the S&P 500 this year is Technology (1.1%), and because it’s easily the largest sector, that’s why so many sectors are outperforming, including five sectors that are up over 5%. The best performing sector, though, is Industrials which finished last week up just shy of 10% for the year.
The technical picture for Industrials also looks positive. For about the last month now, the sector has been trading right around its highs from late last year, and while it was acting as resistance, just last Friday, it broke out to new highs just as the rising 50-DMA looks like it’s on track to cross back above the 200-DMA. Late last year, we were positive on the Industrials sector given the trend of onshoring and less regulation in a second Trump administration, and that has, so far, played out this year.
Jun 6, 2025
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“The greatest discovery of the 21st century will be the discovery that Man was not meant to live at the speed of light.” – Marshal McLuhan
Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.
Given all the drama coming out of DC, you can’t be faulted for forgetting there’s an employment report today, but that is probably what should receive the most focus this morning from the markets. Whether it does is another story altogether. Heading into the report, US equity futures have bounced from Thursday’s close as they look to erase much of yesterday’s losses. European stocks are pretty much unchanged, while Asian equities were mixed with modest gains and losses. In the Treasury market, yields are little changed, as is the case with crude oil, even as gold, silver, and Bitcoin see modest gains.
Yesterday’s spat between Elon Musk and President Trump sucked all the oxygen out of the room when it comes to news and overshadowed every other major geo-political event that the market had been focused on heading into the day. The argument also sucked a lot of the market cap from Tesla (TSLA) stock as it fell more than 14% for its third double-digit percentage decline this year! While the declines have been painful, TSLA has also experienced two double-digit percentage rallies this year, including a 22.7% gain on 4/9, which was its largest one-day gain since May 2013. In other words, the stock has been volatile, even by the standards of TSLA.
Yesterday, on an intraday basis, TSLA plunged 11.7%, which was just the 14th time since its IPO in 2010 that the stock declined by double-digit percentages from the open to close and the second time this year. We’d also note that the 21.1% rally from the open to close on 4/9 was the stock’s second-largest open-to-close rally in its history.
While TSLA has been volatile, it hasn’t made a lot of headway. With the stock closing yesterday at $284.70, it was 3 cents–yes, CENTS–higher than where it opened after Election Day last November. There have been some major moves within those six months, but for all the talk about how Musk’s support of Trump was just a sinister ploy to buy influence and enrich himself, the stock’s performance says otherwise. While the stock hasn’t done much since the election, over the last year, shares have rallied just under 60%, which is nearly six times the 11% gain of the S&P 500.
YTD performance within the mega-cap tech space looks like a pack of FruitStripe gum. At the top of the performance list, Meta Platforms (META), Broadcom (AVGO), and Microsoft (MSFT) have all experienced double-digit percentage gains this year, while TSLA, Apple (AAPL), and Alphabet (GOOGL) have seen double-digit percentage declines. In between, Nvidia (NVDA) and Amazon.com (AMZN) have modest gains or losses.
From a shorter-term perspective, the disparities are nearly as wide. While AAPL and TSLA are both modestly below their 50-DMAs, AVGO headed into last night’s earnings report nearly 30% above its 50-DMA while NVDA, META, and MSFT were all at least 10% above that level. While often thought of as a monolith with the stock market, when it comes to performance, mega-cap tech has been in as much unison as political discourse at a holiday dinner.
