The S&P 500 Index ($SPX) (SPY) is up +1.15%, the Dow Jones Industrials Index ($DOWI) (DIA) is up +1.09%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up +1.49%.  June E-mini S&P futures (ESM25) are up +1.11%, and June E-mini Nasdaq futures (NQM25) are up +1.49%. 

Stock indexes today are climbing and recovering some of last Friday's selloff on hopes that hostilities between Israel and Iran will remain contained and not escalate throughout the Middle East.  WTI crude oil prices gave up sharp overnight gains and turned lower as the ongoing attacks have so far spared key oil export infrastructure in Iran.  There's also been no blockage of the vital Strait of Hormuz that handles about 20% of the world's daily crude shipments, although navigational signals from over 900 vessels moving through the strait have been disrupted due to "extreme jamming" of signals from the Iranian port of Bandar Abbas, causing confusion and increasing the risk of collisions.   

Gains in stocks accelerated today after the Wall Street Journal reported that Iran seeks to an end to hostilities and wants a resumption of talks over its nuclear program. The Iranian government told Arab officials it would be open to return to the negotiating table as long as the US doesn't join the attack.  The Iranian government also sent messages to Israel saying it is in the interest of both sides to keep the violence contained.  However, Israeli Prime Minister Netanyahu has said the attacks will continue until Iran's nuclear program and ballistic missiles are destroyed, and he has shown no indication he is ready to stop.

Hostilities between Israel and Iran entered a fourth day with no signs of easing.  Iran fired several waves of drones and missiles over the past 24 hours, while Israel continued hitting Tehran, killing more senior military officials. 

Today's US economic news is negative for stocks after the June Empire manufacturing survey general business conditions index unexpectedly fell -6.8 to -16.0, weaker than expectations of an increase to -6.0.

Investors will be watching the G-7 meeting in a resort town near Banff, Canada, through Tuesday as President Trump meets with his counterparts due to the possibility of new trade or tariff developments.  Investors are also bracing for negative tariff news over the next few weeks, following President Trump's announcement last Wednesday that he intends to send letters to dozens of US trading partners within one to two weeks, setting unilateral tariffs ahead of the July 9 deadline that came with his 90-day pause. 

The markets will also be focused on Tuesday's May retail sales report (expected -0.6% m/m and +0.2% m/m ex-autos).  Also, on Tuesday, May manufacturing production is expected to rise +0.1% m/m, and the June NAHB housing market index is expected to climb to 36 from 34 in May.  The FOMC's 2-day meeting begins on Tuesday and expectations are for the fed funds target range to remain unchanged at 4.25%-4.50%.   The markets will look to the Fed's dot-plot and post-meeting comments from Fed Chair Powell as to when the Fed may again ease policy.  On Wednesday, May housing starts are expected to fall -0.2% m/m to 1.359 million, and May building permits are expected to climb +0.2% m/m to 1.425 million.  Weekly initial unemployment claims will be released on Wednesday due to the Juneteenth holiday on Thursday and are expected to fall by -3,000 to 245,000. 

The markets are discounting the chances at 0% for a -25 bp rate cut at the Tue-Wed FOMC meeting.

Overseas stock markets today are higher.  The Euro Stoxx 50 is up +0.92%.  China's Shanghai Composite closed up +0.35%.  Japan's Nikkei Stock 225 closed up +1.26%.

Interest Rates

September 10-year T-notes (ZNU25) today are up +4 ticks.  The 10-year T-note yield is down by -0.6 bp to 4.411%.  T-note prices recovered from early losses and turned higher on short covering after news that Iran wants to end hostilities knocked crude oil prices down by more than -4%, reducing inflation expectations.  Also, the unexpected decline in the US Jun Empire manufacturing survey of general business conditions index was bullish for T-notes. 

T-notes today initially moved lower after the sharp rebound in the equity market reduced safe-haven demand for Treasuries.  Also, supply pressures are weighing on T-notes as the Treasury will auction $13 billion 20-year T-bonds later today. 

European government bond yields today are moving lower.  The 10-year German bund yield is down -1.2 bp to 2.523%.  The 10-year UK gilt yield is down -2.0 bp to 4.530%.

Swaps are discounting the chances at 6% for a -25 bp rate cut by the ECB at the July 24 policy meeting.

US Stock Movers

Chip makers are rallying today and are supporting gains in the broader market.  Advanced Micro Devices (AMD) is up more than +9% to lead gainers in the S&P 500 and Nasdaq 100.  Also, ON Semiconductor Corp (ON) and Marvell Technology (MRVL) are up more than +5%, and Micron Technology (MU) and Lam Research (LRCX) are up more than +4%.  In addition,  Microchip Technology (MCHP), Intel (INTC), Applied Materials (AMAT), GlobalFoundries (GFS), and NXP Semiconductors NV (NXPI) are up more than +3%, and KLA Corp (KLAC), ARM Holdings Plc (ARM), and Texas Instruments (TXN) are up more than +2%.  

Travel and hotel stocks are moving higher today as crude prices plunge on news that Iran wants to end hostilities and restart talks over its nuclear program.  MGM Resorts International (MGM) is up more than +6%, and United Airlines Holdings (UAL) and Wynn Resorts Ltd (WYNN) are up more than +5%.  Also, Norwegian Cruise Line Holdings (NCLH), Carnival Corp (CCL), and Las Vegas Sands (LVS) are up more than +4%, and Ceasars Entertainment (CZR) is up more than +3%.  In addition, Royal Caribbean Cruises Ltd (RCL) and Host Hotels & Resorts (HST) are up more than +2%. 

Sage Therapeutics (SAGE) is up more than +34% after agreeing to be acquired by Supernus in a deal worth up to $12 a share.

Roku Inc (ROKU) is up more than +9% after announcing a partnership with Amazon.com that will allow advertisers to have access to more than 80% of US households with connected TV through the Amazon DSP marketing tool. 

US Steel (X) is up more than +4% after Nippon Steel won conditional US approval for its $14.1 billion purchase of the company. 

Incyte (INCY) is up more than +3% after reporting positive results of clinical data from two trials of its experimental therapy to treat a blood disorder.

Archer Aviation (ACHR) is up more than +3% after CEO Goldstein said it expects defense-related sales to outstrip demand for commercial taxis in the short term.

Smurfit WestRock Plc (SW) is up more than +3% after Jeffries upgraded the stock to buy from hold with a price target of $55. 

Defensive managed care stocks are falling today with the recovery in the broader market. HCA Healthcare (HCA) is down more than -4% to lead losers in the S&P 500, and UnitedHealth Group (UNH) is down more than -2% to lead losers in the Dow Jones Industrials.  Also, Universal Health Services (UHS), Molina Healthcare (MOH), and Elevance Health (ELV) are down more than -2%. 

Energy stocks and energy service providers are slumping today, with the price of WTI crude oil down more than -4%.  APA Corp (APA) and Diamondback Energy (FANG) are down more than -3%, and ConocoPhillips (COP) and Occidental Petroleum (OXY) are down more than -2%.  In addition, Devon Energy (DVN), Haliburton (HAL), and Schlumberger (SLB) are down more than -1%. 

Sarepta Therapeutics (SRPT) is down more than -47% after Piper Sandler and BMO Capital Markets downgraded the stock on news that a second patient had died after being treated with its gene therapy for a rare muscle disorder. 

Freshpet (FRPT) is down more than -3% after UBS initiated coverage of the stock with a recommendation of sell and a price target of $65. 

KalVista (KALV) is down more than -2% after the FDA said it won't meet the June 17 goal date for the company's New Drug Application for sebetralstat for treating hereditary angioedema due to its heavy workload and limited resources. 

Earnings Reports (6/16/2025)

Powerfleet Inc NJ (AIOT), Lennar Corp (LEN), Digital Turbine Inc (APPS).