Market Review: June 06, 2024

Closing Recap

Thursday, June 06, 2024





DJ Industrials




S&P 500








Russell 2000













US equities trended sideways overnight and into this morning’s economic data releases. After some minor volatility around the mixed bag of data, equity futures remained flattish into the open and early trading. Mid-morning breadth tilted slightly in favor of decliners as small caps underperformed. IWM was -0.6% versus SPY +0.02% and QQQ +0.08%. Sector-wise, early outperformers on the upside were Communications, Health Care and Consumer Staples, while Utilities, Industrials and Materials led the underperformers lower. Investor sentiment as measured by the Fear and Greed Index continues to be muted with a reading of 44/100 (Fear) today versus similar readings of 43 and 39 last week and last month, respectively. The year-ago level was 73 (Greed). By comparison, the bull-bear spread data from AII this morning was 7 versus 12.3 a week ago. Bulls were unchanged at 39%, while bears rose from 26.7% to 32%.


On the data side today, @KevRGordon notes the easing in unit labor cost growth remains consistent with disinflation for core PCE as we see the slowest pace of increases in unit labor costs since late 2019. Separately, @bespokeinvest and @LizAnnSonders highlight the national mortgage delinquency rate dipped in April to 3.09%, the lowest since a sub-3% reading in March 2023. On rates, @charliebilello mentions the ECB cut rates for the first time since 2019, while the Bank of Canada has cut for the first time since 2020. The first cut from the Fed is not expected until September. As the S&P 500 continues to see gains, @charliebilello also notes the top three companies in the index (MSFT, NVDA and AAPL) now make up over 20% of the index, marking the highest concentration since data began in 1980.


During the final hour of trading, stocks had rebounded from the lows of an afternoon fade but remained modestly lower. Small caps continued to underperform and breadth remained slightly in favor of decliners. Growth outperformed value, but both the Russell 1000 Growth and its Value counterpart were slightly in the red. From a sector view, Consumer Discretionary, Energy and Health Care were the new leaders to the upside while Utilities, Industrials and Technology were primary laggards with Materials also in the red but closer to flat.


Economic Data

  • US initial jobless claims rose 229k versus a prior reading of +219k and estimates of +220k.
  • US Q1 labor costs were revised to +4% versus prior +4.7% and estimates of +4.9%, while revised productivity rose 0.2% versus prior +0.3% and an estimate of flat.
  • US April trade balance came in at -$74.6B versus March at -$68.6B and a Street view of -$76.45B.

Commodities, Currencies & Treasuries

  • August gold futures gained $15.40/oz, or +0.65%, to settle at $2,390.90 as the US Dollar faded but finished slightly off the intraday high. The active contract hit a two-week high during the session as softer jobs data raised hopes for Fed rate cuts later in the year (current consensus appears to be September cut). Separately, gold investors continue to support the Gold Fear and Greed Index in the Greed range at 75/100, comparing favorably against 65 and 68 last week and month, respectively.
  • July WTI crude futures settled +$1.48/bbl, or +2%, to $75.55, while Brent gained $1.46/bbl, or 1.86%, to finish at $79.87. Both moves gained momentum following the ECB rate cut as hopes grew that the probability of a Fed cut later this year would be bolstered by the decision.
  • The 10-year yield faded modestly on the softer jobs data and rising hope for a Fed cut later this year while the market is left wondering where we go from here. For example, @LizYoungStrat notes, "The 10-year Treasury yield has fallen below 4.33%, a key level of support and resistance over the last 18mo, in addition to its 200d MA. Trend shift?"





WTI Crude















10-Year Note




Stock movers:

  • CXM tumbled in the software sector after Q1 earnings missed consensus and guided Q2 revs $194M-$195M vs. consensus $196.8M and cuts revs view to $779M-$781M from $804.5M-$805.5M.
  • FIVE shares tumbled in discount retailer after missing on both top and bottom line for Q1 as comp sales decreased by (-2.3%) vs. est. +1.4%; guides Q2 net sales $830M-$850M vs. est. $879.5M and EPS $0.57-$0.69 vs. est. $1.01; cuts FY24 adjusted EPS view to $5.00-$5.40 from $5.71-$6.22 and lowers year sales view.
  • LULU shares jumped in retail after posting a top and bottom line beat for Q1 and announced a stock buyback program by $1B, which overshadowed lower guidance (guides Q2 EPS $2.92-$2.97 vs. est. $3.04 and revenue $2.4B-$2.42B vs. est. $2.46B; sees FY24 EPS $14.27-$14.47 (est. $14.11) and sees FY24 revenue $10.7B-$10.8B (est. $10.75B).
  • NIO shares dropped after the Chinese EV maker missed Q1 EPS and sales estimates, Citigroup also lowered its price target to $8.50 from $10.50 while maintaining a Buy rating
  • LYFT shares rose as the ride hailing company held its Investor Day. The company said it expects its gross bookings to grow ~15% between FY24 and FY27.
  • NVAX shares which were +20% in the pre-market after last night’s bullish news from the FDA, reversed course shortly after the opening, ending the day -5% in a ‘buy the rumor, sell the news’ scenario. FDA advisers voted in favor of recommending new covid vaccine target JN.1 lineage for 2024-25 campaign.
  • GME shares rocketed higher after Keith Gill aka “Roaring Kitty” announced on his YouTube channel that he would hold his first live stream event in over 3 years on Friday night. GameStop shares traded over +40% on late trading. Fellow meme-stock AMC followed suit, gaining sharply in concert.
  • HTZ shares moved lower after Bloomberg reported the car rental company was mulling a sale of ~$700M in debt and convertible debt.
  • SMAR shares rose as the software company reported a better-than-expected quarter, beat April quarter consensus ARR estimates and raised its FY25 ARR outlook.
  • SMG shares slip early in the chemical sector after guiding year adj EBITDA $530M-$540M below forecast $575M following softer Q2 earnings and rev outlook.
  • VNDA shares gained after Bloomberg reported Cycle Pharmaceuticals Ltd. has made an unsolicited takeover approach for the pharma company, offering to buy Vanda for $8 per share in cash
  • VSTO shares rose after MNC Capital raised its offer to acquire the company to $39.50 per share, or a value of over $3B, above its previous sweetened bid of $37.50 per share from its initial offer $35 bid on March 25th.
  • CORZ shares ascended after the crypto infrastructure company rejected Tuesday’s unsolicited offer from CoreWeave, opening the door to a higher offer or other suitors.
  • NVDA and MSFT shares took a respite from their furious upward move, falling close to 2%. In the pre-market, investors learned that the DOJ and FTC would be opening an antitrust probe of Nvidia, Microsoft, OpenAi.
  • CRM’s stock rallied after the opening as news that Salesforce Director Morfit Mason and his fund ValueAct Holdings had purchased $100M worth of CRM stock on Monday disseminated across the street.
  • FAST and ODFL shares fell as the fastener distributor and transportation company reported weaker than expected monthly sales.
  • SJM, the food manufacturer’s shares rose after the company reported a sold EPS beat while including strength in their Uncrustables lines of premade PB&J sandwiches.
  • TTC shares closed near daily highs after the lawnmower maker’s earnings revealed strength in its Residential division


Market commentary provided by Hammerstone Markets, Inc, a firm separate from and not affiliated with Regal Securities. Regal Securities has not participated in the creation of the content, and does not explicitly or implicitly endorse the content.