Photoraffy link via Wall Street sign in stock in New York in the evening
Today’s S&P 500 Index ($SPX) (SPY) is up +0.03%, Dow Jones Industrial Index ($dowi) (DIA) is up -0.16%, and Nasdaq 100 Index ($IUXX) (QQQ) is up +0.17%. E-Mini S&P Futures (ESU25) fell by -0.04% in September, and E-Mini Nasdaq Futures (NQU25) rose by +0.10% in September.
Today’s stock indexes are mixed. Today, Apple and Tesla are up over +2% to lead technology inventory. However, concerns that the US labor market is weakening have limited profits from the broader market after the June ADP Employment Report showed an unexpected decline in employment for US companies for the first time in more than two years. The weakness of health insurance stocks is also heavy in the overall market, led by a plunge of -37% in St. Neane after withdrawing guidance for 2025 due to different insurance market trends than initial assumptions.
The market is awaiting a House vote on the Senate version of the President Trump tax and spending bill. Trade talks will also focus on the July 9 deadline for mutual tariff implementation. Late Tuesday, President Trump said the country is likely to pay 30%, 35% or “whatever the numbers we have decided” tariffs, as there is no likelihood of a trade deal with Japan.
On Tuesday, the Senate passed the Republican settlement bill by 51-50 votes. The bill is currently under consideration in the House of Representatives and is expected to vote within the week. Speaker Johnson said the House would “work quickly” to pass the bill by July 4th. The settlement bill has a rise in the debt cap necessary to avoid the Treasury default when the Treasury abolishes borrowing authorities between mid-August and late August. The nonpartisan Congressional Budget Office estimates the bill will add nearly $3.3 trillion to the US budget deficit over the next decade.
US MBA mortgage applications rose 2.7% for the week ended June 27, with the purchase mortgage subindex rising 0.1% and the refinance mortgage subindex rising +6.5%. The average 30-year fixed-rate mortgage fell 6.79% to -9 bp from 6.88% the previous week.
Changes in ADP employment in US June unexpectedly fell -33,000, weaker than expected for an increase of +98,000 and an initial decline of 2-1/4.
The negative aspect of stocks is the upcoming revenue season that begins next week. Bloomberg Intelligence data shows that the S&P 500 company’s second quarter revenue consensus was a 2.8% increase from the previous year, the lowest increase in two years. Also, only six of the 11 S&P 500 sectors are projected, according to a Yardeni survey.
During this week of shortened holiday, the market will look for additional trade and tariff news, along with the developments in the potential of President Trump’s tax bill. On Thursday in June, the farm’s non-farm salary is expected to rise to +113,000, with employment rates expected to reach 4.3% in June. Additionally, average hourly revenues for June are expected to increase by +0.3%m/m and +3.8%y/y. Additionally, the weekly initial unemployment claim is expected to rise from +5,000 to 241,000, with factory orders expected to jump to +8.1%m/m. Finally, the June ISM Services Index is expected to rise from +0.7 to 50.6.
Futures prices for federal funds are discounted at 23% on the possibility of a -25 bp rate reduction at the FOMC meeting on July 29-30.
Today’s overseas stock markets are mixed. The Euro Stoxx 50 is up +0.36%. China’s Shanghai composite fell -0.09%. Japan’s Nikkei stock 225 fell -0.56%.
interest rate
September 10th T-Notes (Znu25) is down at -9 ticks today. The T-note yield over the course of 10 years was 4.291%, an increase of +4.9 bp.
T-Notes is under pressure today due to the weakening of European government bond intrusions. Speculation that Congress is also approaching passing President Trump’s tax and spending bills has caused some weaknesses in T-note prices. The Congressional Budget Office estimates the bill will add nearly $3.3 trillion to the US deficit over the next decade, which will allow the Treasury security sales to fund the deficit. Rising inflation expectations have also lowered the price of T-Notes. This is because 10-year break-even inflation rate rose to a weekly high at 2.319% today.
T-Notes’ losses are limited after the June change in ADP employment fell unexpectedly for the first time in more than two years, and is a tremendous factor in the Fed’s policy. Also, the weakness of stocks today has encouraged a safe demand for T-notes.
Today, European government bond yields are moving higher. Germany’s chest yield over the decade jumped to a 1-1/2 month height of 2.673%, up 2.669% from +9.5 bp. The 10-year British gold leaf yield rose to a three-week high of 4.633%, up 4.620% from +16.6 bp.
The eurozone could indicate a weaker labor market than unemployment rates rose unexpectedly +0.1-6.3%, with no change of 6.2%
Centeno, a member of the ECB Management Council, said the ECB is “not in a hurry” to further reduce interest rates, despite inflation targeting 2%.
Lane, a member of the council that manages the ECB, said that “we are worried that inflation will fall below the ECB’s target for a long period of time” as the ECB predicts 18 months of inflation below its target due to the US tariffs and the expansionary eurozone economy.
The swap is discounting the 6% chance if the ECB cuts -25 bp rate at its policy meeting on July 24th.
US Stockmover
Health Insurance stocks have led to a plunge of -37% in Centene (CNC) after tickling guidance for 2025, citing trends in the insurance market that threatens revenues of $1.8 billion, unlike that assumption. Additionally, Molina Healthcare (MOH) exceeds -14%, while Elevance Health (ELV) exceeds -6%. Additionally, Humana (Hum), Cigna Group (CI), HCA Healthcare (HCA), and UnitedHealth Group (UNH) are above -2%.
Brightview Holdings (BV) has declined more than -14% after cutting its full-year revenue forecast from $2.68 billion to $2.73 billion to $2.744 billion to under $2.788 billion.
Oscar Health (OSCR) has fallen more than -13% after Barclays began compensation for its stock with an underweight recommendation and a price target of $17.
Adobe Inc (Adbe) has dropped by more than -3% after Rothchild & Co downgraded its shares to sell from Hold with a price target of $280.
Crocs Inc. (Crox) has fallen by more than -1% after Goldman Sachs began compensation for its stock, and then met its sales recommendations and price target of $88.
Tesla (TSLA) is up over +2% to lead the Gainers on the Nasdaq 100 after reporting that Shanghai’s delivery rose in June.
Apple (AAPL) is up over +2% to lead Dow Jones Industrials winners after Jeffries upgraded its stock to keep from underperformance.
Cruise line operators are moving higher than they are today. Carnival (CCL) and Royal Caribbean Cruise Limited (RCL) have risen by more than +2%, while Norwegian Cruise Line Holdings (NCLH) has risen by more than +1%.
Verint Systems (VRNT) has risen by more than +6% after Bloomberg News reported that acquisition company Thoma Bravo is in talks to acquire the company.
Cava Group (Cava) has risen by more than +2% after KeyBanc Capital Markets began compensation for its stock by recommending overweight and a $100 price target.
Ross Store (ROST) is up over +1% after Jeffries upgraded its shares and purchased from holds at a price target of $150.
Revenue Report (7/2/2025)
Franklin Covey Co (FC), Unifirst Corp/MA (UNF).
On the date of publication, Rich Asplund had no position (directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. This article was originally published barchart.com
