Market Snapshot

River1 Asset Management
May 12, 2025

Morning Note

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Calendar

This Week – Early week – CPI, Digesting Tariff news, mid-week Retail related earnings, late week Powell speaks.

Tuesday – CPI

Wednesday – 3 Fed Speakers

Thursday – PPI, Initial Jobless Claims, Philly Fed, Powell Speaks at 8:40am ET at a Conference.

Friday – Housing Starts

Trading Observations

Best case relative scenario for the markets
Big cave by both parties as USA reduced tariffs from 145% to 30%, China 125% to 10% for 90-day cool off period
We should regain and hold the 200-day at 5750 resistance and expect broad based buying
SPY basically back to flat for the year, NASDAQ-100 futures only down 6% from their all-time highs
Pharma and Healthcare in a state of flux on Trumps comments, a lot of confusion as to what it means
Dollar ripping
Bond yields spike some more now at 4.44%, but stock markets will overlook that today but may be a headwind at some point soon
Wall of worry turns to debt ceiling and reconciliation bill in the House/Senate
Expect animal spirits to be abound in speculative stocks and high short interest names

Futures

DOW +1,026

S&P +166

Nasdaq +766

Charts/Sentiment

CNN Fear/Greed Index

U.S. 10 Year Treasury

Gold down ~3% as safe haven needed less

Bitcoin - pushing through $100K

Financials / Retail / Healthcare

Risk On Morning – Financials like SOFI, HOOD, COIN all up 4-7%. Even BAC, and WFC up nearly 4%. No real news outside some COIN defenders post meh earnings.

Baird on Restaurants – Q1 earnings fine, comps into Q2 small deterioration.

GS on SMID Banks and the VC ecosystem shows investment up 12+ Q/Q and +16% y/y. Solid for FCNCA confirms this.

GS Kostin – Holding 2025 SPX EPS at $253. 20x P/E is $5060 vs $5800 open this am.

Pharma Stocks as president Trump seeks to cut US drug costs

LLY vs. NVO – Lilly said its Zepbound was superior to Novo’s Wegovy in cutting weight https://www.bbc.com/news/articles/cy75dk8kjr1o [bbc.com]

Technology

AI/Power Up: (1) Nuclear power – the White House is considering several executive orders aimed at accelerating the construction of nuclear power plants (NYT) ... (2) Google signs a deal w/ Elementl Power to develop 1.8GW of advanced nuclear power (Tech Crunch)

AAPL PX HIKES: WSJ says Co weighing price increases for its fall iPhone lineup; wont attribute to tariffs

AMZN: purchase of Annapurna Labs may be one of the “smartest deals in tech history” as the small chip startup provides the silicon that’s powering AWS (WSJ)

MRVL: +19% off May 7 lows

MSFT (from late last wk): Microsoft and OpenAI are in talks to restructure their relationship, w/ the former Co willing to surrender some equity in the latter in exchange for access to technology developed beyond 2030 (FT)

Semis/AI proxies on Fire: group has been ground zero for trade/tech wars .... SMH +5.6% above 100D / below 200D; highest level since late Feb ... pre: ALAB+12%, CLS+11%, LITE/MRVL+8.5%, VRT/COHR+8%, AMD/ARM/ON/ANET+7%, MCHP/NXPI/AVGO+6%, NVDA+5%

NVDA Said to have raised the official prices for almost all of its GPUs, as well as H200 and B200 chips and modules; Server manufacturers have also adjusted the relevant server quotations to customers, with an increase of ~ 10-15% - DigiTimes

NVDA: $160 PT; Improvements In GB200 Shipments; Resolve Key Concern; OW Top Pick – Morgan Stanley

SHOP: +7% to replace MDB in Nasdaq 100