Daily News Round Up
Thursday, 12 Jun 2025
Equity Market Resilience Despite Macroeconomic Headwinds: Despite concerns around slowing global growth – highlighted by a contraction in the UK economy (-0.3% MoM) and cautious commentary from JPMorgan Chase’s CEO – the S&P 500 has largely recovered losses from April, with the IT and communications sectors leading gains (33.7% and 25% respectively since April 8). (CNBC), (Seeking Alpha). This suggests ongoing investor optimism, potentially fueled by easing inflation and expectations of future rate cuts.
- Inflationary Pressures Remain Moderated, Supporting Risk Assets: CPI data came in below expectations in May (2.4% YoY), aligning with forecasts and contributing to a decline in Treasury yields, suggesting the market is pricing in a less aggressive monetary policy path. (InvestorPlace), (WSJ). While wholesale inflation data (PPI) is still pending, the current trend suggests inflation is not spiraling, despite concerns surrounding tariffs.
- US-China Trade Deal Offers Temporary Relief, But Uncertainty Lingers: A potential trade deal between the U.S. and China, including increased access to rare earth minerals, has provided a short-term boost, even with limited details and some disagreement (“agreed in principle” vs. handshake agreement). (Forbes), (Barrons). However, the deal’s long-term impact remains uncertain, particularly given political factors and continued tariff threats.
- Corporate Earnings Outlook Mixed, With Sectoral Disparities: While overall S&P 500 earnings for the June quarter are projected to increase (+5.2% YoY), there’s growing pressure on estimates as the quarter progresses. (Zacks Investment Research). Individual company reports revealed a mixed bag – Chewy beat on EPS but missed revenue estimates, while Dave & Buster’s also reported a miss on revenue despite positive trends in monthly comparable store sales. (FMP), (FMP), highlighting sector-specific performance variations.
- Investor Sentiment Remains Cautious, Despite Market Recovery: Despite equity markets showing resilience, investor risk aversion continues for the fifth consecutive month, despite easing caution in equity markets. (Seeking Alpha). Concerns regarding trade tensions, political divisions, and potential economic slowdowns are contributing to this underlying hesitancy, suggesting that the current rally may be vulnerable to correction.
What happened yesterday?
Macro
Economic Growth: The U.K. economy shrank sharply in April as global trade tariffs and domestic tax rises kicked in, data showed Thursday. U.K. GDP contracted 0.3% month on month in April. (CNBC)
Economic Growth: After stumbling to its lowest point in nearly a year this April, the S&P 500 has recovered nearly all its losses in roughly two months. The S&P 500’s IT and communication services sectors fared the best during this rally, gaining 33.7% and 25%, respectively, since April 8. (Seeking Alpha)
Economic Growth: Total S&P 500 earnings for the June quarter are expected to be up +5.2% from the same period last year on +3.8% higher revenues, with a broader and greater pressure on estimates relative to other recent periods since the June-quarter got underway. (Zacks Investment Research)
Economic Growth: The US economy is showing unexpected resilience in the first half of 2025, but mounting uncertainty over trade policy and slowing domestic demand are likely to weigh on growth through the rest of the year, according to economists at Wells Fargo. Revisions to income data and weaker import growth could provide a temporary boost to GDP, particularly in the second quarter, analysts noted. (Proactive Investors)
Economic Growth: Wells Fargo expects the US markets to have a washout in 2025 while reaching new heights in 2026. The firm said the tariffs will cause uncertainty in the current year, while a bounce back from a highly volatile environment, backed by historical data, makes a case for high returns in 2026. (Invezz)
Economic Growth: “I think there’s a chance real numbers will deteriorate soon,” the longtime JPMorgan Chase CEO told investors at a Morgan Stanley conference Tuesday. (New York Post)
Inflation: The central bank surprised markets with a jumbo rate cut last week. The move, spurred by easing inflation, underscores policymakers’ shift toward more aggressive monetary easing to bolster economic growth. (CNBC)
Inflation: Wholesale inflation data for May is due at 8:30 a.m. ET (WSJ)
Inflation: The stock market, including the Dow Jones, fell despite U.S.-China trade deal progress and a cool inflation reading. PPI data is now due. (Investors Business Daily)
Inflation: May CPI comes in below expectations (InvestorPlace)
Inflation: Treasury yields drop after CPI report shows tariffs aren’t making prices spiral. (WSJ)
Inflation: The U.S. stock markets closed a volatile Wednesday session in the red as investors digested a fresh batch of inflation data, cautious news regarding a U.S.-China trade truce, and persistent concerns over escalating tensions in the Middle East impacting oil prices. The US markets took a breather as the indices snapped a 3-day winning streak. (Invezz)
Inflation: The Wall Street Journal reports that the 2.4% (annualized) inflation in retail consumer prices in May was lower than expected and defies “fears that the impact of President Trump’s tariffs would start to show a rise in prices.” (Forbes)
Inflation: U.S. inflation picked up a bit last month as food costs rose, though overall inflation remained mostly tame.Consumer prices increased 2.4% in May compared with a year ago, according to a Labor Department report released Wednesday. That is up from a 2.3% yearly increase in April. (Fast Company)
Inflation: A one-two punch of critical inflation reports this week was supposed to show rising prices tied to high U.S. tariffs. The first punch missed, but Wall Street is watching for a follow-up body blow. (Market Watch)
Inflation: The latest reading on inflation shows an overall easing in the pace of price increases. [contact-form-7] The data released Wednesday (June 11) from the Bureau of Labor Statistics showed that the impact of tariffs has been benign, or at least they were in May. (PYMNTS)
Inflation: Fresh inflation data showed consumer price pressures eased more than expected in May, supporting investor sentiment even as U.S.-China trade talks concluded with few changes. The Consumer Price Index (CPI) increased just 0.1% in May, with annual inflation cooling to 2.4%, in line with forecasts. (Proactive Investors)
Interest Rates: Vice President JD Vance echoed President Donald Trump’s calls for the U.S. central bank to lower interest rates, saying its refusal to do so is “monetary malpractice.” (Fox Business)
Interest Rates: It was a fourth consecutive robust offering. An auction of 10-year Treasury debt encountered strong interest from buyers, marking a fourth consecutive robust offering and helping to allay concern that demand for U.S. assets is declining. (Barrons)
International relations: If a handshake agreement holds, it would merely undo some of the damage from the trade war that President Trump started. (NYTimes)
International relations: President Donald Trump announced that the U.S. has reached a trade deal with China, subject to final approval by Chinese President Xi Jinping. A central component of the deal, reportedly includes expanding U.S. access to Chinese rare earth minerals, in exchange for concessions allowing more Chinese students to attend American universities and the export of sensitive products to China. (Forbes)
International relations: The trade is effectively a bet that the president won’t deliver fully on his threats, to avoid a major hit to U.S. markets or the economy. (Barrons)
Investment: The concept of value investing was pioneered in the U.S. roughly a century ago. But lately, the approach has had far more success abroad. (Market Watch)
Market Sentiment: The current market rally lacks solid fundamentals and is driven by outdated bullish habits and hope, not by real progress or solutions. Key risks include unresolved trade tensions, a more hawkish Fed, rising US national debt, and deepening political divisions, all undermining market stability. (Seeking Alpha)
Policy: Trump pivots to trade, May inflation is mild, the U.S. wants more nuclear capacity, and more news to start your day. (Barrons)
Policy: Trump is reportedly considering Treasury Secretary Scott Bessent among top contenders to replace Fed Chair Jerome Powell, who he has criticized over interest rates. (Fox Business)
Policy: Overall US investor sentiment leaned toward risk aversion for the fifth month in a row, even as caution in equity markets diminished for a third straight month. Equity markets were volatile in March and April as the US readied new tariffs on nearly all major trading partners. (Seeking Alpha)
Policy: T-bills are dwindling in supply, as the U.S. has been operating without a debt-ceiling fix since January. (Market Watch)
Policy: After running a short-lived surplus in April thanks to tax season receipts, the deficit totaled just over $316 billion for the month, taking the year-to-date total to $1.365 trillion. Surging financing costs were again a major contributor to fiscal issues, with interest on the $36.2 trillion debt topping $92 billion. (CNBC)
Trade: U.S. stock futures slumped in premarket trading early Thursday, with the benchmark S&P 500 slipping by 0.4% to 6,004 points. The Dow Futures index was the worst hit, dropping by 0.5% to 42,684 points, while the tech-focused Nasdaq Futures fell 0.4% to 21,799 points. (Forbes)
Trade: Trump said a deal had been reached, but Beijing said the sides had “agreed in principle.” (Barrons)
Trade: As President Donald Trump’s 90-day tariff pause nears its end, Treasury Secretary Scott Bessent is signaling fresh openness towards shifting the deadline. He said that for any of the United States’ 18 “important trading partners” that are “negotiating in good faith,” the Trump administration could “roll the date forward to continue good faith negotiations. (CNBC)
Trade: As President Donald Trump on Wednesday announced progress on trade negotiations with China, Wall Street continues to ask questions on how much tariffs the nation’s retail chains can handle. (Market Watch)
Trade: Revenue from duties jumped to $22 billion in May, and customs officials are stepping up enforcement to collect it. (WSJ)
Trade: How the levies are affecting corporate profits is likely to become a focus for investors. (Barrons)
Trade: U.S. tariffs on China won’t change again, Lutnick says (CNBC)
Industry
Energy: U.S. crude stocks fell last week as refining activity picked up, driving gasoline and distillate inventories higher, the Energy Information Administration (EIA) said on Wednesday. (Reuters)
Corporate
Apple Inc / Microsoft Corp / Nvidia: Many investors wish they could have bought and held shares of massively successful stocks like Apple, Microsoft and Nvidia from the day they went public. (Market Watch)
ArcBest Corporation: On June 10, 2025, ArcBest Corporation (NASDAQ:ARCB) stock closed at $70.54, a 0.51% decrease of $0.37, after trading between $70.40 and $72.10. Jefferies maintains a “Buy” rating, raising the price target from $75 to $85, while BofA Securities upgraded from “Underperform” to “Neutral,” increasing the target from $63 to $74. ArcBest’s CFO reported stronger-than-expected Q2 volume trends, with a 5% increase in tons per day (compared to a typical 3% rise in May over April) and a 2% increase in shipments per day (compared to a typical 1%). The company’s market capitalization is approximately $1.62 billion; its 52-week high is $129.83 and its low is $55.19. (FMP)
Arch Capital Group: UBS reaffirmed a Buy rating on Arch Capital Group (ACGL) with a $124 price target, citing strong capital generation and share repurchase potential. UBS projects ACGL will accumulate over $3 billion in capital in the next year, with $2 billion potentially allocated to buybacks, special dividends, or M&A. Management aims to repurchase stock at valuations recoverable within three years, given a current valuation of 1.6x book value and a mid-teens Return on Equity (ROE). EPS forecasts were raised to $9.01 for 2026 and $9.98 for 2027. (FMP)
Bank of America: Bank of America expects its markets business could post a 13th consecutive quarter of revenue growth and investment banking fees could hit up to $1.2 billion in the second quarter, CEO Brian Moynihan said on Wednesday. (Reuters)
Berkshire Hathaway: It’s bullish when insiders invest their own money into their companies — especially when those executives and directors have a record of savvy timing. (Market Watch)
Chewy (NYSE:CHWY): Chewy (NYSE:CHWY) reported first-quarter net sales of $3.12 billion, an 8.3% year-over-year increase, exceeding estimates of $3.08 billion. Net income decreased to $62.4 million, down from $66.9 million the previous year and below analyst expectations of $70.9 million. Operating costs rose to $846.9 million, up from $789.4 million. The stock fell over 10% intra-day. (FMP)
Chewy Inc: Chewy reported earnings per share of $0.35, exceeding the estimated $0.34, and revenue of approximately $3.12 billion, beating expectations. Revenue increased by 8.3%, reaching $3.12 billion. Despite this growth, the company’s gross margin slightly decreased, and shares declined in premarket trading due to the first quarter profit not meeting analysts’ expectations. Chewy’s price-to-earnings (P/E) ratio is approximately 41.81, its debt-to-equity ratio is about 1.92, and its current ratio is approximately 0.75. The financial performance was disclosed on June 11, 2025. (FMP)
Dave & Buster’s Entertainment: Dave & Buster’s Entertainment (NASDAQ:PLAY) stock rose over 13% intra-day. The company reported adjusted earnings of $0.76 per share, missing the consensus estimate of $1.01. Revenue was $567.7 million, a 3.5% decline year-over-year. Comparable store sales decreased 8.3% year-over-year. Monthly comparable store sales improved sequentially, declining only 2.2% to date in Q2. The company reaffirmed guidance for fiscal 2025, planning 10 to 12 new store openings and capital expenditures under $220 million. (FMP)
GameStop (NYSE: GME): GameStop (NYSE: GME) shares fell more than 4% intra-day after reporting first-quarter results. The company posted adjusted earnings of $0.17 per share, exceeding the $0.04 estimate, and a net income of $44.8 million. Revenue was $732.4 million, missing the $754.2 million forecast. Hardware and accessories revenue decreased by roughly 32%. International restructuring charges resulted in an operating loss of $10.8 million. The company has closed “hundreds” of U.S. stores. (FMP)
GitLab: GitLab (NASDAQ:GTLB) shares fell over 8% intra-day after reporting Q1 results. Adjusted Q1 earnings per share were $0.17, exceeding the expected $0.15. Revenue reached $214.5 million, a 27% year-over-year increase, slightly surpassing the $213 million consensus. Q2 revenue guidance is $226–227 million, and the full-year outlook is $936–942 million, both aligning with Street estimates. The company reported a non-GAAP operating profit of $26.1 million, compared to a $3.8 million loss in the prior year, alongside a net retention rate of 122% and a 26% year-over-year increase in customers with over $100,000 in annual recurring revenue. (FMP)
J.Jill, Inc.: J.Jill, Inc. (NYSE:JILL) reported first-quarter fiscal year 2025 financial results on June 11, with earnings per share of $0.88, meeting analysts’ expectations, but revenue of $153.6 million falling short of the $156.8 million projection. Earnings per share decreased from $1.22 in the same period last year, and revenue declined from $161.51 million year-over-year. The company offers an annual dividend yield of 1.87%, with a quarterly dividend of 8 cents per share. To generate $500 monthly in dividends, an investor would need approximately 18,750 shares, valued at about $321,563. J.Jill’s current price-to-earnings ratio is 6.54, price-to-sales ratio is 0.42, and debt-to-equity ratio is 1.97. (FMP)
Lakeland Industries, Inc.: Lakeland Industries, Inc. (NASDAQ:LAKE) achieved record net sales of $46.7 million, a 29% year-over-year increase, driven by a 100% increase in Fire Services products now comprising 45% of total revenue. U.S. net sales rose 42% to $22.5 million, while European sales increased 102% to $12.1 million. The company reported a gross profit of $15.6 million and an operating loss of $4.6 million, resulting in a net loss of $3.9 million, compared to a net income of $1.7 million in the prior year. Lakeland expects fiscal 2026 revenue between $210 million and $220 million, with adjusted EBITDA between $24 million and $29 million. The stock price was $15.07, with a revised price target of $26 (previously $30). (FMP)
Vail Resorts: UBS lowered its price target on Vail Resorts (NYSE:MTN) from $185 to $169, maintaining a Neutral rating. Pass unit growth is expected to remain negative for the 2025–2026 ski season. A recent +7% Epic pass price hike is projected to yield only a 2–3% net pricing increase. Same-store visitation is down 2–3% this year. UBS estimates 3% underlying cost growth in 2026, partially offset by the absence of $24 million in one-time expenses. 2026 EBITDA is now projected to be flat, down from a prior +5% growth estimate. Structural labor cost pressures and rising customer acquisition costs are identified as medium-term risks. (FMP)
