Market Snapshot

River1 Asset Management
June 26, 2025

Morning Note

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Calendar

This Week – 14 Fed Speakers, but the only one that matters is Tuesday/Wednesday Powell in front of Congress. PCE Thursday/Friday.

Thursday – PCE, Capital Goods, Initial Jobless Claims, NKE Earnings post.

Friday – PCE, Some end of quarte setup, but Monday is the final.

Trading Observations

Month end approaches and window dressing should keep a bid under the market
Tech especially (NVDA new ATH) https://tinyurl.com/4xruem8v [tinyurl.com]
MU with a very strong print should push semis and AI higher
After underperforming at the start of the year, the Semi group is again leading SMH breaking out suggests any weakness likely short lived and path of least resistance higher
Tech rally not just Mag7 anymore https://tinyurl.com/cvvnhtc3 [tinyurl.com]
QQQ with a golden cross https://tinyurl.com/5797vc63 [tinyurl.com]
Banks also outperforming relative
Going to try again for a CLOSE above 6100, if it holds 6147 highs in sight
SO FAR, Trump and tariffs not front and center (long may it continue)
Especially with quarter end, think this right "Call Options trading has exploded, suggesting short-term speculation has never been greater. Most of the options have an expiration of a week or shorter. However, speculative crowds can carry the market further for longer before reaching an extreme."
Ideally would like to see breadth improve https://tinyurl.com/4pzdpn9k [tinyurl.com]
CFO optimism fading a bit https://tinyurl.com/yc29a3x6 [tinyurl.com]
Just wow https://tinyurl.com/kjuj8nxy [tinyurl.com]
QQQ at new highs, but only 10% of Nasdaq 100 at 52-wk highs https://tinyurl.com/2rfvtezk [tinyurl.com]

Futures

DOW +110

S&P +18

Nasdaq +92

Charts/Sentiment

CNN Fear/Greed Index

U.S. 10 Year Treasury

Oil

Bitcoin

Financials / Consumer / Healthcare

WBA – Beat low expectations. Market doesn’t care because it’s going private.

Deal within bill pay solutions, Xero to buy Melio for $2.5B, or 9x revenue.

COF – JPM out with a new post-merger note. It’s all very long-term, but COF could start issuing on the Discover network, which would help the margins. Note is positive, PT to $210 from $183.

A note from GS on changes to the capital backstop rules for banks and how that helps is out. They think banks will buy more treasuries, especially in times of stress. Add this to all the stablecoin UST buyers and we’ve helped fix any potential runaway bond market problems. They think balance sheet could get opened up to the tune of $5.5T, which would be massive for the economy.

CRCL – Up 3% on nothing. Seems to like $200 for now.

PYPL – Signed a deal with the Big10 and Big12 to handle athlete payments.

TFC – Upgraded to Buy at Citi.

MGM – Downgraded to underperform at JMP.

MKC – McCormick Spices up 5% on an “everything is fine” quarter.

NKE tonight - With Nike Inc.’s fourth-quarter results due on Thursday, some analysts say the company’s sluggish sales and stock price should reach the bottom soon — if not now, then in the months ahead — after struggling with competition, squeezed consumers and weaker sneaker demand over the past few years.

Technology

AAPL: reportedly launched China’s gov’t subsidy program on its official website for the first time to boost sales – Economic Daily

ASML: -1.2% Jefferies downgrading - forecasts 2026 wafer fab equipment to decline 1%, versus consensus at positive double-digit growth. Negative view arises from an "anti-consensus expectation" for a 16% fall in DRAM wafer fab equipment in 2026, and a further decline in China wafer fab equip (watch AMAT LRCX etc)

AI TALENT WARS: META has poached three researchers from OpenAI as compensation competition in the industry heats up (WSJ) .... META won a major AI-related copyright lawsuit when a federal judge said it was “fair” that the firm trained its models on millions of books (FT)

CSCO: ticking to fresh highs ... KeyBanc init OW - checks show product order growth remain healthy for several quarters in a row, which "bodes well for 2026/2027 rev growth expectations; believes the subscription/software mix shift makes Cisco appear relatively attractively valued versus its software and security peers

DUOL: down four in a row (~17% over stretch) as 3P data cont to tick lower

GOOGL: Google has unveiled Gemini CLI, an open-source AI agent that embeds the Gemini model into the command line interface (CLI), aiming to revolutionize the way users interact with terminals. The service offers the industry's highest free usage quota, allowing up to 60 model requests per minute and 1,000 daily requests without charge

MU: +1.5% strong FQ3 upside on EPS w/ beat driven by healthy rev ($9.3B vs. the Street $8.85B) and better margins (220bps above). Q4 Revs/GM/EPS topped bogeys (revs $10.4B - $11B vs street at $9.9B, above bogeys .... Data center revenue more than doubled Y/Y ... Mgmt acknowledged they saw some demand pull-forward because of tariffs, and the PC market forecast was trimmed (they now see PC units growing 1-3% vs. the prior estimate of ~5%)

RDDT: shrs cont to act well (Wed: Cleveland initiated at buy and RBC called out positive checks) ... Report this am Co working to ensure its vast pool of content remains generated by humans instead of the swarm of low-quality AI bots taking over the rest of the internet (FT)

Industrials

KTOS - Shares fell after the company announced a $500M underwritten public offering of common stock, with underwriters granted a 30-day option to purchase an additional $75M. All shares will be sold by Kratos, with proceeds earmarked for national security programs, strategic acquisitions, general corporate purposes, potential debt reduction, and offering-related costs. (stock was up big yesterday in sympathy w/ AVAV

Acuity (AYI) trading up 8% after Q3 results came in ahead of consensus expectations

Forward Air (FWRD) upgraded to buy from hold at Stifel

Helios Technologies (HLIO) upgraded to overweight at KeyBanc

TSLA: contd reports of poor driving behavior from robotaxis