Market Performance
The S&P 500 (+0.1%) and Nasdaq Composite (+0.3%) closed at fresh record highs after a somewhat mixed session. The Russell 2000 (+0.6%) also closed with a gain while the Dow Jones Industrial Average declined 0.1%.
Mixed Price Action
Mixed price action in the mega cap space contributed to the lackluster showing in the S&P 500 and Nasdaq Composite. However, the overall vibe was positive throughout the session. Advancers led decliners by an 11-to-10 margin at the NYSE and by a 4-to-3 margin at the Nasdaq.
Individual Stock Performance
- Meta Platforms (META) logged a solid decline, weighing on the communication services sector (-1.0%).
- Alphabet (GOOG), Microsoft (MSFT, Financial), and Amazon.com (AMZN, Financial) also registered losses.
Semiconductor Stocks
Semiconductor stocks outperformed the broader market, providing a measure of support. The PHLX Semiconductor Index (SOX) showed a 1.9% gain at the close. NVIDIA (NVDA, Financial) and Broadcom (AVGO, Financial) were winning standouts from the space. This price action contributed to the gain in the information technology sector (+0.7%).
Market Hesitation
The muted action today was also related to some hesitation in front of market-moving events this week. Specifically, the June Consumer Price Index and Producer Price Index are released on Wednesday and Thursday, respectively. Earnings season starts this week when large cap banks like JPMorgan Chase (JPM), Wells Fargo (WFC), and Citigroup (C) report.
Bond Market
The 10-yr note yield settled unchanged at 4.27% and the 2-yr note yield rose two basis points to 4.62%.
Year-to-Date Performance
- Nasdaq Composite: +22.6% YTD
- S&P 500: +16.8% YTD
- Dow Jones Industrial Average: +4.4% YTD
- S&P Midcap 400: +4.5% YTD
- Russell 2000: +0.6% YTD
Economic Data
Consumer credit increased by $11.3 billion in May (consensus $9.5 billion) after increasing an upwardly revised $6.5 billion (from $6.4 billion) in April. The key takeaway from the report is that revolving credit growth accelerated strongly after a slight contraction in May, raising questions about whether consumers are turning to revolving credit because of need or increased optimism about economic prospects.
Upcoming Economic Data
Tuesday's economic lineup is limited to the June NFIB Small Business Optimism survey at 6:00 ET.
Today's News
Nvidia (NVDA, Financial) was highlighted on Monday as investment firms UBS and Wolfe Research raised their price targets, citing robust demand for its upcoming Blackwell line. Shares rose 2% in late trading. UBS analyst Timothy Arcuri noted that Nvidia could earn roughly $5 per share in 2025 due to a significantly larger order pipeline for NVL72 and NVL36. Wolfe analyst Chris Caso similarly raised his price target, emphasizing strong investor sentiment despite recent downgrades.
Broadcom (AVGO, Financial) saw a 2% rise in early market action Monday, ahead of its 10-for-1 stock split scheduled for next week. The split will increase Broadcom's shares from 2.9 billion to 29 billion. The company also announced a mixed securities shelf offering for general corporate purposes, including potential business acquisitions. Broadcom's stock has increased over 20% since the split was announced.
Boeing (BA, Financial) is in discussions with the U.S. Department of Defense regarding the retention of its government contracts after agreeing to plead guilty to a criminal charge related to two fatal 737 Max crashes. This plea could potentially make Boeing ineligible for defense contracts, which constituted about a third of its revenue last year. The company has reached a tentative agreement with the Justice Department to plead guilty to criminal conspiracy.
United Airlines (UAL, Financial) experienced another incident involving a wheel detaching from a Boeing (BA, Financial) aircraft during takeoff. A main landing gear wheel flew off a Boeing 757-200 while departing from Los Angeles, landing safely in Denver. This follows a similar incident in March involving a Boeing 777-200. The U.S. Federal Aviation Administration has initiated an investigation into United Airlines.
Vermilion Energy (VET, Financial) announced the Toronto Stock Exchange's approval for its normal course issuer bid, allowing the purchase of up to 15.69 million common shares over the next twelve months. The company aims to return 50% of excess free cash flow to shareholders through dividends and share repurchases.
Super Micro Computer (SMCI, Financial) surged nearly 7% on Monday, leading a group of semiconductor companies benefiting from the growing AI market. Advanced Micro Devices (AMD), Broadcom (AVGO, Financial), Marvell Technology (MRVL), Intel (INTC, Financial), Qualcomm (QCOM), and Arm Holdings (ARM) also saw gains. Increased demand for AI hardware in data centers and cloud providers is driving this growth.
Intel (INTC, Financial) shares rose about 4% after Melius Research suggested that companies like AMD, Apple (AAPL, Financial), and Intel could catch up with AI leaders like Nvidia (NVDA, Financial) in the second half of the year. Mizuho Securities noted a short-cover trade in chipmakers, indicating a lack of negative catalysts for downside movement.
Petrobras (PBR, Financial) increased gasoline prices in Brazil by approximately 7%, the first hike in nearly a year. The move, which leaves prices below international levels, signals new CEO Magda Chambriard's willingness to prioritize the company's finances over political pressure to keep fuel costs low.
Kymera Therapeutics (KYMR, Financial) announced that Sanofi (SNY) plans to expand ongoing Phase 2 trials for KT-474 in Hidradenitis Suppurativa and Atopic Dermatitis, aiming for quicker progression to pivotal studies. Kymera's stock has risen 36.76% over the past year.
Microsoft (MSFT, Financial) will require its China-based staff to use only iPhones for work starting in September, as part of its global Secure Future Initiative. This move aims to ensure all staff use the Microsoft Authenticator password manager and Identity Pass app, as Google Play is not available in China.
Amazon (AMZN, Financial) unveiled a new Echo Spot alarm clock ahead of its Prime Day event. The new model, priced at $79.99, features a display for time, weather, and music, and is integrated with Amazon's voice assistant, Alexa. Prime subscribers can purchase it at a discounted price through July 17.
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