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May 21, 2025
Dow: 42,292
S&P: 5907
Nasdaq: 19,100
10-YR T-Note: 4.54%
Bitcoin: 103,500
VIX: 19.22
Gold: $3,300
Crude Oil: 62.15
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.
After a rally of seven days, the market finally fell under the weight of this tremendous turnaround from a rally based on low prices to nearly all the way back to its best levels set earlier this year.
The Dow declined by 115 points to 42,677 led by selling in some of the stocks that had been doing well such as AXP, CAT, GS, HD which went from positive to negative after its earnings report. And in the latest stock that everyone wants now, UNH rallied for the third straight session after its recent collapse.
The S&P dropped 23 down to 5940 as most of the large technology stocks ended down. But it is still within 3.3% of its record high. The Nasdaq came down by 72 to 19,142 for the same reason, and TSLA went on a wild ride only to end up a little higher.
The Russell 2000 Index of small stocks had the nerve to keep up its recent gains with 1 point to 2105 and the VIX dropped a little down to 18.01.
Treasury yields and the value of the U.S. dollar held relatively stable following after Moody’s Ratings said the U.S. government no longer deserves the highest credit rating because of worries about its spiraling debt.
Several of the stock market’s worst losses came from companies in the travel industry, as doubts continue about how much U.S. households will be able to spend on vacations.
VIK fell by 5% even though the company, which offers river cruises and other trips, reported stronger results than analysts expected for the latest quarter. Ohers in this group such as ABNB, NCLN and UAL fell as well.
Dow component HD slipped after reporting a profit for the start of the year that came up just short of analysts’ expectations, though its revenue topped forecasts. The home-improvement retailer also said it is sticking with its forecasts for profit and sales growth over the full year.
That forecast runs counter to a growing number of companies, which have recently said tariffs and uncertainty about the economy are making it difficult to predict what the upcoming year will bring.
The President has launched stiff tariffs against trading partners, only to delay or roll many of them back. Investors are hopeful that he will eventually lower his tariffs after reaching trade deals with other countries, but that is not a certainty.
On the winning side was QBTS, which jumped 26% after releasing its latest quantum computing system. The company says it can solve complex problems beyond the reach of classical computers.
In the bond market, the yield on the 10-year Treasury edged up to 4.47% from 4.46% late Monday. The two-year yield, which more closely tracks expectations for action by the Federal Reserve, edged down to 3.96% from 3.97%.
Concern still remains that Trump’s tariffs could push the U.S. economy into a recession, even if it has held up for the time being. If a recession were to hit, the U.S. government may have less room to offer support for the economy through big spending plans or direct stimulus checks to households than in prior downturns. That is because the U.S. government’s debt is so much higher now, and it could be set to get even bigger with the government discussing more tax cuts.
China’s central bank made its first cut to its loan prime rates in seven months in a move welcomed by investors eager for more stimulus as the world’s second-largest economy feels the pinch of Trump’s higher tariffs.
The Reserve Bank of Australia reduced its benchmark interest rate by a quarter of percentage point for a second time this year, to 3.85%, judging inflation to be within its target range. The earlier reduction, in February, was Australia’s first rate cut since October 2020.
Following the cuts, stock indexes rose across much of the world. Hong Kong’s Hang Seng jumped 1.5% for one of the bigger gains.
Shares in China’s CATL, the world’s largest maker of electric batteries, jumped 16.4% in its Hong Kong trading debut after it raised about $4.6 billion in the world’s largest IPO this year. Its shares traded in Shenzhen, mainland China’s smaller stock market after Shanghai, gained 1.2% after dipping earlier in the day.
Earnings are winding down for the first-quarter and the lineup is still heavy on retailers: yesterday – Dow component HD and VIK lower; today – TOL higher and TGT, TSX, PANW, LOW lower; tonight - SNOW; Thursday – AAP, ADI, INTU, WDAY.
Economic reports will have: Thursday – April existing home sales, weekly jobless claims; Friday – April new home sales.
