Market Recap – Tuesday, June 24, 2025
Stocks Rally as Geopolitical Risks Ease, But Economic Concerns Remain
Stocks finished higher today, extending Monday’s gains. The Dow rose by 1.19%, the S&P 500 gained 1.11%, and the Nasdaq increased by 1.43%. The Russell 2000, which tracks smaller companies, gained 1.34%. The market’s upward momentum was fueled by easing geopolitical tensions and positive sentiment in several sectors.
Key Market Sectors:
Winners: Semiconductors, cruise lines (like Carnival), transport companies, banks, asset managers, payment companies, online brokers, media, and China-based tech companies led the way.
Laggards: Energy stocks struggled, particularly oil, which dropped 6% today. Other weak sectors included aerospace and defense, dollar stores, real estate investment trusts (REITs), and some food-related stocks.
Other Market Factors:
Treasuries: Bond prices were firmer, with yields dropping by 4-5 basis points.
Dollar and Gold: The dollar fell 0.5%, while gold saw a slight decline of 1.8%. Bitcoin futures were up 2.1%.
Oil: WTI crude oil dropped 6.0%, falling below $70 per barrel after a volatile week.
Geopolitical and Economic News:
Geopolitical risks in the Middle East were a major driver today. A ceasefire between Israel and Iran appears to be holding, which helped ease some market fears. Oil prices responded to the news, though concerns remain over the closure of the Strait of Hormuz.
On the economic front, consumer confidence data came in weaker than expected, with the Conference Board’s index falling back to March levels. Despite this, inflation expectations fell slightly, and the Richmond Fed manufacturing index showed signs of improvement.
Fed News:
Federal Reserve Chair Jerome Powell testified today, maintaining his cautious stance on potential rate cuts. Some other Fed officials, like Waller and Bowman, are more dovish, suggesting that a rate cut could be coming as soon as July if inflation continues to ease. However, Powell and others are still taking a wait-and-see approach.
Notable Corporate News:
Tesla (TSLA-US): The stock was a laggard today, despite the company’s successful launch of its Robotaxi service in Austin.
Uber (UBER-US): Gained 7.5% after announcing its launch of robotaxi services in Atlanta.
Carnival (CCL-US): Rose 6.9% after a strong earnings report and a positive outlook for bookings.
Circle Internet (CRCL-US): Saw a 9.6% gain after being named a partner in a new stablecoin platform.
Notable Stock Moves:
Upstart Holdings (UPST-US): Jumped 9.8% after an analyst upgrade, with positive prospects for its AI-driven lending model.
Uber Technologies (UBER-US): Up 7.5% after its robotaxi launch in Atlanta, marking another milestone in autonomous vehicle development.
TD SYNNEX (SNX-US): Gained 7.3% after strong earnings and continued momentum in the IT distribution space.
Decliners:
Advance Auto Parts (AAP-US): Dropped 7.1% after being downgraded to sell by Goldman Sachs.
SM Energy (SM-US): Fell 2.3% after a downgrade due to expectations of lower oil prices.
Dollar General (DG-US): Dropped 1.4% after being downgraded by Goldman Sachs due to valuation concerns.
Looking Ahead:
With ongoing geopolitical developments and upcoming economic data, the market is likely to remain volatile. Key economic reports on home sales, GDP, and consumer spending will be in focus over the next few days, while Fed commentary will continue to shape market expectations for future rate cuts.
Here's Our Take:
Today’s market rally was fueled by easing geopolitical tensions and positive sentiment in key sectors like semiconductors, cruise lines, and banking. While the easing of Middle East tensions helped reduce risk fears, oil prices dropped sharply, reflecting continued uncertainties. The consumer confidence miss suggests that economic sentiment may be cooling, but inflation expectations ticking down is a positive sign. The Fed’s cautious stance on rate cuts means that economic data in the coming weeks will be crucial for shaping the central bank’s next move. With a busy week ahead for economic data and Fed commentary, we encourage investors to remain focused on how these factors unfold, especially with ongoing uncertainty around trade, tariffs, and inflation.
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