Daily Market Notes | 5-minute read

June 4, 2024

By Donald Selkin | Chief Market Strategist

DOW: 38,520.88

S&P: 5,262.87

Nasdaq: 16,762.23

10YR T-Note: 4.35%

Bitcoin: 70,060.00

VIX: 13.72

Gold: $2327.32

Crude Oil: $73.30

Prices Current as of 11:45 am

Source: CNBC

40+ Years on

Don Selkin, the creator and innovator of the "Fair Value" numbers, as its Chief Market Strategist on the Newbridge platform has given CNBC and its Predecessor, these numbers every day for the over 40 years - never missing a single day, as well as given the fair value for the Nasdaq 100 futures since their introduction in 1996 and the Dow Jones stock index futures since 1997. Mr. Selkin has also been quoted in several publications including but not limited to Bloomberg News, New York Post, Reuters, and The New York Times. Mr. Selkin's Fair Value numbers are included in the U.S.
Futures Report broadcast on CNBC every day before the market
opens attributing "Newbridge Securities" as the source. In addition, NSC provides to its professionals, their clients and the public access to Don Selkin's more in depth financial market views.

The market did not quite do what it did very late Friday afternoon, but was able to turn large intraday losses around 1pm into more respectful closes to start the new month of June yesterday.

For instance, the Dow turned a large 438 point decline at 1pm into a final loss of 115 to 38,571 as selling in AXP, CAR, CVX, HD and TRV assured a losing session.

The S&P started out with a 25 point gain which then became a 43 point loss at 1pm as well before again making an astounding upside run to finally end with a final 6 point advance up to 5283 as it was led by buying in two out of its top three components, namely AAPL, which has now ground 30 points higher from its recent lows and NVDA which got good news on the chip front to post a huge gain to near its all-time high best level ahead of its 10 for 1 split on Friday. The index had more losing stocks than winners and showed the extent to which the big leaders can influence things one way or the other.

The Nasdaq also followed the same pattern with a 179 point start becoming an 89 point decline at 1pm, and then reversing course to finish 93 points ahead at 16,828 led by the two aforementioned winners in addition to COST at a new high, META and AMZN.

The Russell 2000 Index of small stocks lost 10 down to 2059 while the VIX continues to scrape bottom as it nudged up to 13.11

Treasury yields also slid in the bond market after a report showed U.S. manufacturing shrank in May for the 18th time in 19 months, according to the Institute for Supply Management. Manufacturing has been hit particularly hard by high interest rates meant to get high inflation under control.

“Demand remains elusive as companies demonstrate an unwillingness to invest due to current monetary policy and other conditions,” said the chair of the Institute for Supply Management’s manufacturing business survey committee.

Stocks of companies whose profits are most closely tied to the strength of the economy dropped to the market’s worst losses. That included the oil-and-gas industry, as the price of crude tumbled on worries about weaker demand growth for fuel. They sank as the price of a barrel of U.S. oil dropped 3.5%.

Brent crude, the international standard, lost a similar amount despite moves over the weekend by Saudi Arabia and other oil-producing countries meant to prop up its price.

Guess who climbed another 4.9% to bring its gain for this year to 132.2% after unveiling new products and services over the weekend. NVDA has been delivering huge profits to keep at bay criticism that investors have become overzealous about the prospects for AI.

And once again, GME soared 21% in a move not quite reminiscent of its early 2021 ride that brought the term “meme stock” into the parlance of our times. The stock jumped after a Reddit account associated with a central character in the 2021 episode said it had built a stake of 5 million shares, along with options to buy more. The post from Sunday night said the position was worth $181.4 million and this seems a little difficult to believe.

“Meme stock” has become the way to describe companies whose prices move more on the enthusiasm of smaller-pocketed investors than on any fundamental change in their business prospects. Other meme stocks also rose Monday, including an 11% climb for AMC.

In a more traditional move for the market, SRCL jumped 15% after WM said it would buy the medical-waste company for $5.8 billion in cash and assume $1.4 billion of its net debt. The latter fell 4.5%.

In the bond market, the yield on the 10-year Treasury fell to 4.39% from 4.50% late Friday. The two-year yield, which more closely tracks expectations for action by the Federal Reserve, fell to 4.81% from 4.88%.

The hope among investors is for the U.S. economy where it slows enough to keep pressure off inflation but not so much that it causes a recession. That in turn could allow the Federal Reserve to cut its main interest rate.

In stock markets abroad, India’s Sensex jumped 3.4% after the country’s 6- week-long national election came to an end with most exit polls projecting that Prime Minister Narendra Modi will continue in power with a third consecutive term.

Stocks in Mexico, meanwhile, slumped 6% after Claudia Sheinbaum claimed victory in that country’s presidential election.

Earnings this week include: tonight – CRWD, HPQ; Wednesday – CPB, DLTR; Thursday – DOCU, SJM, MTN.

Economic reports will see: yesterday – April construction spending declined by 0.1%, April ISM Manufacturing Index slipped to 47.8, the 18th lower number in the last 19 months; today - April final durable goods orders gained 0.6% and ex-transportation were ahead by 0.4% , April factory orders rose 0.7%, April JOLTS job openings report came in below consensus at 8.06 million; Thursday – weekly jobless claims, April trade deficit; Friday – the big one with May non farms payroll report for which the estimate is 180,000 compared to 175,000.

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