Thursday, June 05, 2025

Friday Watch

Around X:
  • @ZeroHedge
  • @MarioNawful  
  • @LauraLoomer 
  • @TheTranscript 
  • Broadcom double beat. CEO: "Broadcom's record first quarter revenue and adjusted EBITDA were driven by both AI semiconductor solutions and infrastructure software." $AVGO: -1.3% AH. 
  • $AVGO CEO: "Q1 AI revenue grew 77% Y/Y to $4.1B & infrastructure software revenue grew 47% Y/Y to $6.7B. We expect continued strength in AI semiconductor revenue of $4.4B in Q2, as hyperscale partners continue to invest in AI XPUs & connectivity solutions for AI data centers."
  • DocuSign double beat. $DOCU: -14% AH.
  • @WallStreetApes
  • @glennbeck
  • @WarClandestine
  • My understanding of the OBBB situation: The bill has lots of things that advance Trump’s agenda, like tax cuts, finishing the wall, etc., but there is a lot of pork added in by Congress. However, it’s a budget reconciliation bill, so we only need 50 votes as opposed to 60 in the Senate, so Trump and his team are willing to let Congress get their pork, so long as Trump is able to pass what is needed to advance his agenda. Elon doesn’t like the extra pork and wants to slim it down, and Trump just wants to get his bill passed so he can fix pressing problems. I can see both sides of the argument.
Quot
  • @rawsalerts
  • @bennyjohnson 
  • @C_3C_3
  • Elon is 100% about America’s debt. Trump is 100% about DC being a Swamp. The Swamp won’t cut debt because they get rich making debt. Trump has to run America through the Swamp. If Congress was full of Elons it would be easy but it’s full of Swamp Creatures. DC sucks. Facts.
  • Bill Clinton right now with the Democrats calling for the Epstein Client List to be released. (pic)
  • I know everything about Mohamed Soliman in 3 days. I know nothing about Thomas Crooks in 326 days. How can that be?
  • @realannapaulina
Night Trading 
  • Asian equity indices are -.25% to +.5% on average. 
  • Asia Ex-Japan Investment Grade CDS Index 76.0 -1.0 basis point. 
  • China Sovereign CDS 49.5 -.5 basis point.
  • China Iron Ore Spot 95.6 USD/Metric Tonne +.8%.
  • Swiss Franc/Offshore Chinese Renminbi Cross 8.75 -.01%.
  • Bloomberg Emerging Markets Currency Index 37.2 -.01%.
  • Bloomberg Global Risk-On/Risk Off Index 69.1 +.7%.
  • US 10-Year Yield 4.39% +2.0 basis points.
  • Volatility Index(VIX) futures 21.0 +.3%.
  • Euro Stoxx 50 futures -.26%. 
  • S&P 500 futures +.18%. 
  • NASDAQ 100 futures -.02%.
Morning Preview Links

BOTTOM LINE: Asian indices are mostly higher, boosted by consumer discretionary and technology shares in the region. I expect US stocks to open mixed and to weaken into the afternoon, finishing modestly lower.  The Portfolio is 50% net long heading into the day.

Stocks Close Lower on Trump/Musk Feud, Rising "Big Beautiful Bill" Passage Uncertainty, Technical Selling, Gambling/Shipping Sector Weakness

Economic Gauges:

  • Bloomberg Emerging Markets Currency Index 37.15 +.15% 
  • US 10-Year T-Note Yield 4.40% +4.0 basis points
  • 3-Month T-Bill Yield 4.33% -1.0 basis points
  • China Iron Ore Spot 95.7 USD/Metric Tonne +.84%
  • Dutch TTF Nat Gas(European benchmark) 36.4 euros/megawatt-hour +2.1%
  • Citi US Economic Surprise Index -6.7 -3.6 points
  • Citi Eurozone Economic Surprise Index 27.3 +2.7 points
  • Citi Emerging Markets Economic Surprise Index 34.6 +.9 point
  • S&P 500 Current Quarter EPS Growth Rate YoY(496 of 500 reporting) +12.4% unch.
  • S&P 500 Blended Forward 12 Months Mean EPS Estimate 276.98 +.12:  Growth Rate +9.0% unch., P/E 21.7 +.1
  • S&P 500 Current Year Estimated Profit Margin 13.25% unch.
  • NYSE FANG+ Current Quarter EPS Growth Rate YoY(9 of 10 reporting) +32.4% unch.
  • NYSE FANG+ Blended Forward 12 Months Mean EPS Estimate 429.0 +.25: Growth Rate +14.9% +.1 percentage point, P/E 33.2 +.5
  • Bloomberg US Financial Conditions Index .37 -4.0 basis points
  • Bloomberg Euro-Zone Financial Conditions Index 1.47 +8.0 basis points
  • Bloomberg Global Trade Policy Uncertainty Index 7.1 -.3
  • US Yield Curve 46.75 basis points (2s/10s) -2.0 basis points
  • US Atlanta Fed GDPNow Q2 Forecast +3.8% -8.0 basis points
  • US Recession Within 6 Months Probability(3M/18M Forward Yld Curve Spread) 42.8% +2.8 percentage points
  • Cleveland Fed Inflation Nowcast Core PCE YoY +2.65% unch.: CPI YoY +2.40% unch.
  • 1-Year TIPS Spread 2.77 -3.0 basis points
  • 10-Year TIPS Spread 2.30 -1.0 basis point
  • Highest target rate probability for July 30th FOMC meeting: 69.2% (-1.3 percentage points) chance of 4.25%-4.5%. Highest target rate probability for Sept. 17th meeting: 55.4%(-1.8 percentage points) chance of 4.0%-4.25%. (current target rate is 4.25-4.5%)
Overseas Futures:
  • Nikkei 225 Futures: Indicating -141 open in Japan 
  • China A50 Futures: Indicating -69 open in China
  • DAX Futures: Indicating +33 open in Germany
Portfolio:
  • Slightly Higher: On gains in my tech/industrial/financial sector longs
  • Disclosed Trades: Added to my (IWM)/(QQQ) hedges
  • Market Exposure: Moved to 50% Net Long

Bear Radar

Style Underperformer:

  • Large-Cap Growth -.1%
Sector Underperformers:
  • 1) Shipping -1.2% 2) Gambling -1.2% 3) Restaurants -.7%
Stocks Falling on Unusual Volume: 
  • KNTK, LTH, CNTA, MLTX, BULL, LEU, DOCN, PAY, ACIC, DSGX, LZMH, TSLA, CIEN, DXYZ, PVH, BF/B and CRWV
Stocks With Unusual Put Option Activity:
  • 1) BYON 2) DOCU 3) LULU 4) IOT 5) AG
Stocks With Most Negative News Mentions:
  • 1) TSLA 2) CHPT 3) BF/B 4) CIEN 5) PC
Sector ETFs With Most Negative Money Flow:
  • 1) FTEC 2) SOXX 3) PNQI 4) XLK 5) IAI

Bull Radar

Style Outperformer:

  • Small-Cap Growth +.4%
Sector Outperformers:
  • 1) Gold & Silver +1.7% 2) Software +1.3% 3) I-Banks +1.1%
Stocks Rising on Unusual Volume:
  • NBIS, MDB, SMG, OSCR, ARLO, SATS, CYD, MP, KC, AGX, CAPR, SRRK, DLTR, PAAS, OSK, NCLH, LASR, PRCT, DOMO, CRMD, RDY, CC, COO, MGNI, GDS, MGNI, BWLP, RKT, MAG, TSCO, NET, STAA, FIVE, TIC, COOP, BLD, LQDA, MU, BLD, RDFN, STAA, JEF, VRNT, INOD, RDW, GTLB, SOFI, JHX, BROS, TIC, BV, CRSP, GAP, LITE, SA, SSRM, XYF, CFLT and PAX
Stocks With Unusual Call Option Activity:
  • 1) PL 2) CIVI 3) ASTL 4) MDB 5) VEEV
Stocks With Most Positive News Mentions:
  • 1) PL 2) NBIS 3) ARLO 4) JYNT 5) MDB
Sector ETFs With Most Positive Money Flow:
  • 1) XLF 2) XLI 3) XLB 4) SMH 5) XLY
Charts:

Tomorrow's Earnings/Economic Releases of Note; Market Movers

Earnings of Note 
Company/Estimate 

Before the Open:
  • (ABM)/.86
  • (GIII)/.13 
After the Close: 
  • None of note
Economic Releases

8:30 am EST

  • The Change in Non-Farm Payrolls for May is estimated to fall to 125K versus 177K in April.
  • The Unemployment Rate for May is estimated at 4.2% versus 4.2% in April.
  • Average Hourly Earnings MoM for May is estimated to rise +.3% versus a +.2% gain in April. 

3:00 pm EST

  • Consumer Credit for April is estimated to fall to $10.0B versus $10.172B in March. 

Upcoming Splits

  • None of note
Other Potential Market Movers
  • The US Baker Hughes weekly oil rig count, CFTC weekly speculative net positioning reports, FBN Virtual Tech Conference, (JOBY) annual meeting, (GOOG) annual meeting and the (GRMN) annual meeting could also impact global trading tomorrow.
US Equity Market Hours
  • 9:30 am - 4:00 pm EST

Mid-Day Market Internals

NYSE Composite Index:

  • Volume Running +8.6% Above 100-Day Average 
  • Nasdaq/NYSE Volume Ratio 13.2 -1.6
  • 2 Sectors Declining, 9 Sectors Rising
  • 63.5% of Issues Advancing, 34.8% Declining 
  • TRIN/Arms .97 -41.2%
  • Non-Block Money Flow +$118.1M
  • 71 New 52-Week Highs, 11 New Lows
  • 41.8% (+2.5%) of Issues Above 200-day Moving Average
  • Average 14-Day RSI 61.3 +.1
Other:
  • Bloomberg Global Risk-On/Risk-Off Index 68.9 -.44%
  • Bloomberg Cyclicals/Defensives Index 240.4 +.03%
  • Russell 1000: Growth/Value 21,456.4 +.02%
  • CNN Fear & Greed Index 60.0 (GREED) +5.0
  • 1-Day Vix 14.7 +21.0%
  • Vix 17.5 -.9%
  • Total Put/Call .77 -8.3%