Daily News Round Up
Monday, 23 Jun 2025
- Geopolitical Tensions Drive Market Volatility and Oil Price Surge: Heightened tensions in the Middle East following U.S. strikes on Iranian nuclear facilities sparked a risk-off sentiment in Asian markets, with declines ranging from 0.4% to 0.8% across major indices. Brent and WTI crude oil prices jumped nearly 2%, reaching levels not seen since January, with analysts predicting potential surges to $100-$120/barrel if supply through the Strait of Hormuz is disrupted ((FMP), (FMP)).
- Diverging Economic Signals Raise Concerns About Global Growth: While Japan’s manufacturing sector showed positive momentum with a return to growth in June, driven by rising output and inventories ((FMP)), the U.S. leading economic indicators declined for the sixth consecutive month, triggering a recession signal ((Reuters)). This divergence highlights ongoing uncertainty about the global economic outlook.
- Federal Reserve Policy and Interest Rate Expectations Remain in Focus: Federal Reserve Governor Waller signaled a potential for interest rate cuts as early as July, fueling optimism and contributing to declines in Treasury yields ((Proactive Investors)). However, President Trump continues to pressure the Fed to lower rates, creating potential for political interference and influencing leadership considerations ((Barrons)).
- Corporate Developments Reflect Varied Sector Dynamics: Notable corporate activity includes Alibaba integrating its food delivery and travel platforms, Ares Management’s €2 billion investment in Plenitude, and Tesla’s launch of robotaxis in Austin ((FMP), (FMP), (FMP)). These moves highlight strategic shifts within key industries and potential growth opportunities.
- Analyst Sentiment Presents a Mixed Outlook: Despite geopolitical risks and inflationary pressures, some analysts, like Morgan Stanley, recommend a bullish stance on stocks ((Market Watch)), while others remain cautious citing valuation concerns and potential for a significant market pullback ((Seeking Alpha)). This disparity underscores the uncertainty pervading the current market environment.
What happened over the weekend?
Macro
Commodity Prices: Oil prices rose significantly on Monday, reaching their highest levels since January, following U.S. and Israeli strikes on Iranian nuclear facilities. Brent crude increased by 1.97% to $78.53 a barrel, with an intraday high of $81.40. WTI crude gained 2.04% to $75.35, briefly reaching $78.40. Iran, OPEC’s third-largest crude producer, reportedly moved closer to closing the Strait of Hormuz, a chokepoint through which 20% of global oil supply passes. Analyst Sugandha Sachdeva predicts prices could reach $100-$120 per barrel, while Goldman Sachs estimates a temporary peak of $110 if oil flow through the strait is halved. (FMP)
Economic Growth: Japan’s manufacturing activity rebounded in June, with the au Jibun Manufacturing PMI rising to 50.4, up from 49.4 in May and exceeding expectations of 49.5. A PMI reading above 50 signals growth, with June data showing rising output and inventories. The services PMI increased to 51.5 in June, up from 51.0 in May, while the composite PMI rose to 51.4 from 50.2. The expansion marks the first in the manufacturing sector since May 2024. (FMP)
Economic Growth: A measure of future U.S. economic activity fell in May for the sixth straight month and triggered a recession signal, held down by consumer pessimism, weak new orders for manufactured goods, an uptick in jobless benefits claims and a drop in building permit applications. (Reuters)
Geopolitics: Asian equities fell sharply on Monday following U.S. missile strikes on three Iranian nuclear facilities, escalating the Israel-Iran conflict. The S&P 500 futures dropped 0.3% in Asian trade. Key regional market declines included: ASX 200 (-0.8%), CSI 300 (-0.4%), Hang Seng (-0.6%), Nikkei 225 (-0.5%), TOPIX (-0.5%), Gift Nifty 50 (-0.1%), KOSPI (-0.5%), and Straits Times (-0.7%). Iran is considering blocking the Strait of Hormuz, which handles approximately 20% of global seaborne oil. Japan’s manufacturing PMI and services PMI accelerated, with the former showing expansion for the first time in nearly a year. Investors await Tokyo’s inflation data later this week, potentially influencing the Bank of Japan’s rate path. (FMP)
Geopolitics: Asian equities edged lower on Monday amid geopolitical anxiety following U.S. airstrikes on Iranian nuclear facilities. S&P 500 and Nasdaq futures were down 0.1% and 0.2%, respectively, during Asian hours. Brent crude gained 1.4% to $78.07, spiking as high as $81.40, while WTI crude rose 1.4% to $74.88. JPMorgan estimates past regional regime changes have caused average oil price spikes of 30%. CBA’s Vivek Dhar suggests selective shipping disruptions could raise Brent oil to $100+, and Goldman Sachs projects a full closure for a month could spike prices to $110/barrel. The Strait of Hormuz, through which one-fifth of the world’s oil and gas flows, is a key concern. (FMP)
Geopolitics: U.S. stock index futures declined Sunday evening following U.S. airstrikes on Iran’s nuclear facilities, raising concerns of a broader Middle Eastern conflict. S&P 500 Futures fell by -0.3% to 5,997.0, Nasdaq 100 Futures dropped -0.5% to 21,746.5, and Dow Jones Futures decreased -0.3% to 42,376.0. Oil prices briefly surged. Preliminary PMI data for June, expected to show slower business activity, is due Monday. Jerome Powell’s two-day Congressional testimony begins Tuesday. Last week, the Federal Reserve held rates steady and reduced its 2026 rate-cut outlook, citing inflation persistence. (FMP)
Geopolitics: Oil prices have surged approximately 25% in just one month, with WTI climbing to $75 per barrel as the Israel-Iran conflict escalates. The situation has taken a critical turn with the United States entering the fray, launching attacks on Iranian nuclear facilities. (Forbes)
Geopolitics: Israel and Iran are going at it every day, and all the dollar could manage was a measly 0.5% gain on the week. Stocks were down last week, but diversified investors benefitted from a rise in commodity prices and a small gain in bonds. (Seeking Alpha)
Geopolitics: The US just launched ‘Operation Midnight Hammer,’ targeting Iranian nuclear enrichment and storage sites on June 21. These coordinated military actions escalate tensions and raise concerns about regional stability and future conflict. (Seeking Alpha)
Geopolitics: Market reactions after the U.S. strikes have been less aggressive, especially relative to just over a week ago when Israel launched airstrikes against Iran. “The markets view the attack on Iran as a relief with the nuclear threat now gone for the region,” said Dan Ives, managing director at Wedbush. (CNBC)
Geopolitics: U.S. President Donald Trump on Saturday said the United States had attacked Iranian nuclear sites. Iran’s Foreign Minister Abbas Araghchi on Sunday said Tehran reserves all options to defend its sovereignty and people. (CNBC)
Geopolitics: Will the U.S. intervention continue? Will Trump’s domestic political coalition hold? (Market Watch)
Geopolitics: Investors on Sunday were bracing for a flight to safety after the U.S. struck three Iranian nuclear facilities Saturday evening. (Investopedia)
Geopolitics: Conflict is igniting in the Middle East once again. Geopolitical events like wars, debt downgrades, tariffs, or rate shocks are never fun because uncertainty is unsettling. (FXEmpire)
Geopolitics: Markets across the Middle East ended mostly higher on Sunday after the U.S. entered the war between Israel and Iran. (CNBC)
Geopolitics: Israel’s war with Iran carries risks, but investors are giving it a vote of confidence. (WSJ)
Geopolitics: Whatever the geopolitical motivation, stocks and bonds markets have to deal with the possible economic and financial consequences. (Barrons)
Geopolitics: Wall Street has plenty to look forward to next week, with a busy economic and Federal Reserve calendar and some major names on the earnings docket. Investors will be keeping a close eye on the ongoing conflict between Israel and Iran and the impact of the U.S. striking three nuclear sites in Iran. (Seeking Alpha)
Geopolitics: President Donald Trump announced late Saturday the U.S. had joined Israel’s attack on Iran’s nuclear sites, putting the country in the middle of a Middle Eastern war and setting up a potentially volatile market reaction. (Market Watch)
Geopolitics: Wall Street on Friday ended largely flat for the holiday-shortened week, as market participants digested an escalating conflict between Israel and Iran and the Federal Reserve’s fourth monetary policy decision of the year. (Seeking Alpha)
Geopolitics: Making sense of the forces driving global markets. Cautious optimism around a possible de-escalation in the week-long war between Israel and Iran helped foster a relatively positive tone across world markets on Friday, lifting most stock markets and sealing oil’s biggest decline in over a month. (Reuters)
Geopolitics: I believe the market is fairly overvalued, with technical and valuation signals suggesting a potential 20%+ pullback is possible. Geopolitical risks, especially regarding Iran, and unresolved tariff issues could quickly trigger significant volatility or a market downturn. (Seeking Alpha)
Geopolitics: This isn’t the first time energy stocks have zigged while everything else has zagged. It seems to be a feature, not a bug. (Market Watch)
Inflation: No surprises from the Fed (InvestorPlace)
Interest Rates: Hedge fund leverage hit a five-year high last week, with speculators buying banks, trading companies and insurance firms, Goldman Sachs data showed, after U.S. interest rates held steady and just before U.S. attacks on Iran’s nuclear sites. (Reuters)
Interest Rates: Broker/Dealer Assets expanded $490 billion, or 37.2% annualized, during Q1 to $5.759 TN. In response to the 2007 subprime blowup, the Fed slashed rates seven times – 325 bps – to an April 30th, 2008, rate of 2.0%. (Seeking Alpha)
Interest Rates: The stock market ended mostly lower but the Dow Jones squeezed out a gain. Testimony from Fed Chair Powell and a PCE inflation reading loom. (Investors Business Daily)
Interest Rates: Shares of banks and other financial institutions rose as Treasury yields fell for the second straight week. (Market Watch)
Interest Rates: Federal Reserve Governor Waller signaled potential interest rate cuts as early as July, despite the Fed’s decision to hold rates steady over inflation worries amid Trump’s criticism. (Fox Business)
Interest Rates: “I think we’re in the position that we could do this as early as July,” Fed Governor Christopher Waller told CNBC’s “Squawk Box” on Friday morning. (New York Post)
Interest Rates: President Donald Trump wants lower interest rates and a new Fed chair. (Barrons)
Interest Rates: Federal Reserve Governor Christopher Waller has indicated that the Fed could begin cutting interest rates as early as its July meeting, signaling a potential shift toward easing monetary policy. “I think we’re in the position that we could do this as early as July,” Waller said in an interview with CNBC on Friday. (Proactive Investors)
Interest Rates: Fed Governor Christopher Waller may well have glossed over an important lesson in Fed history. (CNBC)
International relations: Most Asian currencies weakened on Monday due to rising geopolitical risk and a stronger U.S. dollar following U.S. strikes on Iranian nuclear facilities. The dollar index rose 0.3%. The Chinese yuan (USDCNY) rose 0.1%, the Indian rupee (USDINR) climbed 0.2%, and the South Korean won (USDKRW) jumped 0.7%. The Australian dollar (AUDUSD) fell 0.7% despite a rebound indicated by PMI data, and the Japanese yen (USDJPY) lost 0.5%. U.S. President Donald Trump claimed the strikes neutralized Iran’s nuclear capabilities. Investors are anticipating Fed Chair Jerome Powell’s testimony starting Tuesday, following last week’s flagging of stagflation risks, and are wary of a potential blockade in the Strait of Hormuz. (FMP)
International relations: Tel Aviv stock market at record highs suggests investors are looking through the current crisis (Market Watch)
International relations: In Germany, manufacturing activity booked a recovery. By contrast, in France, overall activity unexpectedly weakened at a sharper rate. (WSJ)
International relations: The Dow Jones Index has moved sideways in the past few weeks as investors reacted to the ongoing crisis in the Middle East. The blue-chip index, which tracks some of the biggest American companies, ended last week at $42,205, a few points below this month’s high of $43,120. (Invezz)
International relations: President Volodymyr Zelenskiy has called on Ukraine’s Western partners to allocate 0.25% of their GDP to helping Kyiv ramp-up weapons production and said the country plans to sign agreements this summer to start exporting weapon production technologies. (Reuters)
International relations: Year to date, developed-world small-cap is showing renewed leadership over its large-cap counterparts. Small-cap valuations are relatively low, which implies higher expected returns. (Seeking Alpha)
Market Sentiment: Morgan Stanley interpret current geopolitical turbulence as a chance to buy stocks (Market Watch)
Policy: The US central bank should consider giving less forward guidance about its monetary policy intentions, particularly in uncertain times, San Francisco Federal Reserve Bank President Mary Daly said on Sunday. (New York Post)
Policy: Trump and key officials are increasing pressure on Fed Chair Powell to cut rates, signaling potential leadership changes. Betting markets currently favor Kevin Warsh and Chris Waller as leading candidates to replace Powell, with Waller gaining momentum. (Seeking Alpha)
Policy: President Trump wants lower interest rates as two of his signature policy initiatives face looming deadlines. (Market Watch)
Policy: U.S. President Donald Trump said on Friday he may have to change his mind about firing Federal Reserve Chairman Jerome Powell. (Reuters)
Policy: Auditioning to become Trump’s pick to replace Jerome Powell as Fed chair? (Market Watch)
Trade: Despite geopolitical tensions and tariff risks, I expect stocks to reach new highs this summer, driven by resilient market sentiment and progress in trade talks. Oil prices should deflate as Iran is unlikely to disrupt shipments, and ongoing tariff negotiations with the EU show surprising momentum toward resolution. (Seeking Alpha)
Industry
Consumer Goods: CEO Rick Woldenberg is moving equipment out of China, saying that ‘no one’s going to save me.’ (WSJ)
Pharmaceuticals: Novo Nordisk’s Phase 3 trials for CagriSema, a treatment for obesity and diabetes, demonstrated up to 23% weight loss in obese adults and 16% in overweight type 2 diabetics over 68 weeks. 73.5% of patients on CagriSema achieved glycated hemoglobin ≤6.5%, compared to 15.9% on placebo. Gastrointestinal-related side effects were reported by 79.6% of CagriSema patients. Serious adverse events occurred in 9.8% of the CagriSema group versus 6.1% in the placebo group, with 6% of CagriSema patients dropping out due to side effects compared to 3.7% on placebo. (FMP)
Retail: Bernstein analysis indicates that most retailers’ attempts to replicate Amazon’s third-party marketplace and service platform model have underwhelmed financially. Amazon holds over 40% of U.S. e-commerce. Companies like Ocado, Zalando, The Hut Group, and Next have invested in Retail-as-a-Service (RaaS), but returns have been limited. Salesforce invests $700 million annually in technology CAPEX, while Next spends £50 million and Zalando €80 million. Next’s core branded sales have a 21% EBIT margin, compared to just 5% EBIT for its Total Platform RaaS initiative. Bernstein estimates the European RaaS target pool includes 60 apparel retailers with sales between €200 million and €600 million annually. (FMP)
Corporate
Alibaba Group: Alibaba Group (HK:9988) (NYSE:BABA) is integrating its food delivery platform Ele.me and online travel agency Fliggy into its main e-commerce operations, announced on Monday by CEO Eddie Wu as part of a transition to a comprehensive consumer platform. The restructuring follows an internal audit by Ele.me that self-reported alleged supply chain-related corruption involving former CEO and logistics head Han Liu, who is now under police investigation. This decision is driven by intensifying domestic competition, soft consumer spending in China, mounting trade headwinds from U.S. tariff policy, and a pivot to AI and consumer data integration. (FMP)
Ares Management Corp: Ares Management Corp (NYSE:ARES) acquired a 20% stake in Plenitude for €2 billion. This deal values Plenitude, a unit of Eni, at an enterprise value exceeding €12 billion. The investment, made on Monday, represents one of Ares’ largest minority investments and supports its expansion into European energy infrastructure and renewable assets, diversifying its portfolio into sustainable, cash-generative businesses. (FMP)
Bausch Health / Perpetua Resources: John Paulson, former hedge-fund manager, bought large blocks of Bausch Health and Perpetua Resources through funds. (Barrons)
BNY Mellon / Northern Trust: Bank of New York Mellon (BK), with a market capitalization of $65.55 billion, has reportedly initiated preliminary discussions with Northern Trust (NTRS), which has a market capitalization of $21.76 billion, regarding a potential merger. No formal offer has been made, and the talks may not result in a transaction. BNY Mellon recently obtained a license to establish a regional headquarters in Saudi Arabia. (FMP)
CarMax: William Blair reiterated an Outperform rating on CarMax (NYSE:KMX), citing sales momentum and projected profitability acceleration in 2025 due to operating efficiency. CarMax currently holds a 3.7% national market share in used vehicles aged 0 to 10 years, with analysts anticipating growth towards double-digit levels seen in established markets. Profits are expected to outpace sales growth, driven by improved SG&A leverage and a more profitable finance division. Key risks include inventory management complexities, reliance on asset-backed securitizations, and macro sensitivity impacting consumer purchases. (FMP)
Darden Restaurants, Inc.: Darden Restaurants (NYSE:DRI) reported EPS of $2.98 for the quarter ending May 2025, exceeding the estimated $2.96 and improving from $2.65 in the same quarter last year. Revenue reached $3.27 billion, up from $2.96 billion a year prior, and surpassing the Zacks Consensus Estimate by 0.18%. Same-store sales grew by 4.6%, exceeding the StreetAccount estimate of 3.5%. Net income was $303.8 million, or $2.58 per share, consistent with the previous year. Shares increased by over 2% in premarket trading. Key financial ratios include a P/E ratio of 25.32, a price-to-sales ratio of 2.27, an enterprise value to sales ratio of 2.76, an enterprise value to operating cash flow ratio of 19.48, an earnings yield of 3.95%, a debt-to-equity ratio of 2.76, and a current ratio of 0.39. The acquisition of 103 Chuy’s restaurants and the addition of 25 new restaurants contributed to the revenue growth. (FMP)
e.l.f. Beauty (ELF): BofA Securities raised its price target for e.l.f. Beauty (NYSE:ELF) to $135 from $113, maintaining a Buy rating. Q1 sales growth estimate was lowered to 12% from 15%, and the gross margin forecast was adjusted to 69% from 70%, effective August 1 due to tariff impacts. Q1 EBITDA estimate was revised downward from $90 million to $69 million, reflecting faster non-marketing SG&A growth than sales. BofA anticipates sales growth and margin improvement later in the year. (FMP)
Everest Group: Janney initiated coverage on Everest Group (NYSE:EG) with a Buy rating and a fair value estimate of $425. Everest, a reinsurer with a 25-year track record, has a median operating return on equity (ROE) of 12% and annual shareholder value growth averaging 11%. The company took a $1.7 billion charge earlier this year to strengthen casualty reserves, including a $500 million risk margin buffer. Janney anticipates a return to double-digit operating ROE by 2025 and sees the stock trading at 0.9x book value per share (excluding AOCI). Over the past year, Everest repurchased over 1 million shares, and a 10 million share buyback program was authorized in late 2024. (FMP)
Groupon: Roth/MKM raised its price target on Groupon (NASDAQ:GRPN) to $47 from $33, maintaining a Buy rating. The updated target is based on a discounted cash flow analysis projecting a potential stock price above $60 by late 2027, reflecting visibility into 2028 results. This projection, when discounted at a 12% annual rate, aligns with the revised $47 target. The firm anticipates accelerating revenue, Adjusted EBITDA, and free cash flow in the coming years, citing operational improvements and financial discipline. (FMP)
IBM: IBM’s shares have rallied in 2025, fueled by investor confidence in its artificial intelligence strategy. The company currently holds a $6 billion AI “book of business,” powered by its Granite model suite and collaborations with Mistral and Meta. IBM has committed $150 billion to U.S. tech infrastructure and quantum computing development. Consulting revenue decreased by 2%, and $100 million in federal contracts were shelved due to U.S. budget cuts. Despite these challenges, IBM reaffirmed its 5% constant-currency revenue growth target for 2025. (FMP)
Intel Corp / Crown Castle Inc: Intel Corp.’s normalized earnings per share in the first quarter exceeded the consensus projection by a wider margin than any other S&P 500 company. Crown Castle Inc. reported a normalized loss per share of $1.06 in the first quarter, falling short of the consensus projection for a loss of 1.2 cents per share. (Seeking Alpha)
Tesla Inc: Tesla launched Model Y robotaxis in Austin this weekend, offering $4.20 rides with heavy safety controls and utilizing teleoperation—remote human oversight—to bridge the gap to full autonomy. Key details include:
* **Teleoperation Use:** Human intervention is used for ambiguity, training AI, and monitoring, with teleoperators and onboard safety monitors.
* **Industry Comparison:** Waymo uses advisory human agents, Baidu employs backup remote drivers, and Tesla utilizes a mixed approach of onboard monitors and remote operators.
* **Technical Limitations:** Network reliability is a concern, with latency (as low as 100ms) and potential dropouts posing safety risks and scalability challenges—CMU’s Philip Koopman suggests struggles at scale.
* **Regulatory Environment:** Texas lawmakers urged a delay, and the state mandates an in-seat human backup alongside remote teleops, alongside data transparency requirements.
* **Tesla’s Approach:** Initially, Tesla aims for 1 remote operator per 20 cars.
* **API Integration:** Smart APIs from FMP are available for real-time Tesla ratings and earnings dates.
* **Current Status:** The Austin launch is for data collection and trust-building, and early incidents could lead to regulatory delays. (FMP)
Tesla Inc: Tesla launched its first fleet of self-driving robotaxis in Austin, Texas, on Sunday, with a pilot program featuring 10 driverless vehicles operating within a geofenced zone around South Congress. Rides are priced at $4.20 and include a front-seat safety monitor. The launch, described by CEO Elon Musk as the culmination of a decade of work, marks a key revenue driver for Tesla, aiming to monetize autonomous technology. (FMP)
The Campbell’s Company: Argus downgraded The Campbell’s Company (NASDAQ:CPB) from Buy to Hold due to persistent volume declines and margin pressures. Six of the past eight quarters have shown flat or negative year-over-year volume trends. Consumers are increasingly choosing lower-cost alternatives amid prolonged inflation and economic uncertainty. Campbell has faced challenges managing rising input costs. The recent acquisition of Sovos, including the Rao’s brand, is viewed positively and could enhance the Meals & Beverages segment’s performance over time, but Argus sees limited upside at current levels. (FMP)
United Parcel Service, Inc.: Oppenheimer upgraded NYSE:UPS to “Outperform” on June 20, 2025, with a stock price of $100.03. The stock has increased by 1.05% and an additional 1.5% over the past month. The Zacks S&P 500 composite rose by 6.6% over the past month, while the Zacks Transportation – Air Freight and Cargo industry gained 4.6%. UPS is recognized for its high dividend yield and substantial free cash flows, and is implementing a focus on higher-margin deliveries and productivity enhancements for long-term growth. (FMP)
UPS: On June 20, 2025, J.P. Morgan’s Andrew Steinerman set a price target of $47 for NYSE:UPS, which currently trades at $99.37, a 52.7% difference. UPS has a market capitalization of approximately $84.14 billion and a trading volume of 2,690,937 shares. The stock price is currently up 0.16% ($0.16) from the previous close, fluctuating between a low of $99.12 and a high of $100.50 today. Over the past year, UPS has ranged from a high of $148.15 to a low of $90.55. (FMP)
Warby Parker: TD Cowen maintains a Buy rating and $24 price target for Warby Parker (NYSE:WRBY), citing it as a top small- and mid-cap pick. The company achieved GAAP profitability in the first quarter and aims for EBITDA margin improvement of 100 to 200 basis points annually. Revenue growth is projected in the low to mid-teens range, supported by store expansion from 276 locations in fiscal 2024 to a long-term goal of 900. E-commerce currently represents approximately 30% of sales. (FMP)
