Most US sectors gained on Wednesday, with breadth strong, but the continued tech weakness weighed on indices, leaving SPX and NDX in the red. The AI trade continues to prove volatile in June, with the next catalyst being Micron earnings after the close. Major stock updates included Cerebras (CBRS) sinking 19% on expected declines in gross margins, Alphabet (GOOG) to replace Verizon in the Dow Jones, and OpenAI and Broadcom (AVGO) unveiling an LLM-optimised intelligence processor. A combination of tech risk off, lower energy prices, and Quarter-end rebalancing saw T-Notes rally across the curve with the US 10 year yield down to 4.406%. The unexpected decline in New Home Sales and a weaker US 5 year note auction sparked little reaction in the space. The decline in oil prices came as escalations were absent, and markets continue to observe oil flows through the Strait of Hormuz increase without interruption. WTI dipped beneath USD 70/bbl and Brent beneath USD 74/bbl. Axios reported Israel-Lebanon talks had no progress on the first day, while the Israeli Defense Minister said they will not withdraw from Southern Lebanon, even if the US asks them to do so. The EIA report saw a bigger-than-expected crude stock draw, surprise builds in gasoline and distillates, and cushing stocks reaching its lowest level since 2004. In FX, haven outperformance remained the theme, in particular the Dollar, which, despite the drop in yields, managed to rally further to highs of 101.80. Barclays FX quarter-end rebalancing sees strong USD selling against all majors. Elsewhere, precious metals remained correlated with risk-off trade and a firmer Dollar, with spot Gold back to November 2025 levels, trading around 3,980; silver hit lows of 55.62. New Home Sales for May tumbled 7.3% to 580k from 626k. New houses for sale were 496,000, +2.3% M/M, while new home supply was 10.3 months (vs. 9.3 months in April) and the median sale price was little changed at USD 424,900 (vs. USD 416,500 in April). Oxford Economics write that while new home sales were much weaker than expected, they think the pace of sales in May probably marks the bottom of what will be a noisy range over the next few months rather than the start of a more sustained decline. OxEco expect sales to improve later in the year based on our forecast for mortgage rates to move lower, although that improvement may be delayed by a more hawkish Fed. Elsewhere, Oil closed lower by over 3% while Gold was also hit hard closing lower by 3.1%.
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For anyone following my Platinum Service it made 605 points yesterday and is now ahead by 9572 points for June after ending May with a loss of 1104 points, having ended April with a gain of 1730 points, after ending March with a massive gain of 9002 points, having closed February with a strong gain of 5482 points after ending January with a gain of 4757 points, having closed December with a gain of 2599 points, after ending the month of November with a gain of 4542 points, after ending October with a nice gain of 5110 points after closing September with a gain of 3774 points while ending August with a gain of 3362 points after closing July with a gain of 3753 points after closing June with a gain of 3530 points, having closed May with a gain of 3606 points, after closing April with a gain of 7685 points after closing March with a gain of 2254 points while closing February with a gain of 4180 points. January ended with a gain of 2768 points while 1997 points were gained in December. October ended with a gain of 2179 points, after closing September with a gain of 4402 points, following a loss of 301 points in August. July gained 1908 points while June saw a gain of 2074 points. The Platinum Service made a record 9619 points in October 2022. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 2300 points. I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
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