A Broad Friday Rally Takes the S&P 500 Just Below Record Highs
Nine of 11 sectors rose, powering the S&P higher despite semiconductor weakness. Small-caps, though, posted a fifth straight weekly loss for the first time since 2022.
Upside, Downside Movers in the Morning
Upside
– $VEEA +45.0% (regained full Nasdaq listing compliance following its reverse stock split)
– $XRTX +21.0% (outlined planned FDA IND and Health Canada clinical-trial filings for XRx-026 in gout)
– $SAIQ +19.5% (confirmed an October satellite launch advancing its post-quantum secure-communications roadmap)
– $HUM +14.5% (2027 CMS Star Ratings exceeded its top-quartile revenue goal, with its largest contract returning above the bonus-payment threshold)
– $CLOV +11.5% (PPO plans earned 5 stars and the HMO plan earned 4.5 stars for 2027, strengthening 2028 payment and enrollment economics)
– $CCI +9.5%, SBAC +7.0%, AMT +7.0% (tower operators rally as SPCX’s low-band spectrum deal implies a terrestrial buildout and potential new-tenant demand)
– $FSLY +7.0% (Oppenheimer upgrades to Outperform with a $35 target on AI-traffic growth)
– $AAOI +6.0%, LITE +6.0%, COHR +4.5%, GLW +3.5% (optical names rise after LITE said AI-data-center demand has booked component capacity through early 2029)
– $ECHO +5.0% (SPCX’s additional spectrum purchase reinforces the value of ECHO’s existing spectrum and equity partnership)
– $SPCX +4.0% (agrees to acquire a nationwide 800 MHz spectrum portfolio for about $8B, strengthening its direct-to-device mobile push)
Downside
– $ALHC -23.0% (key California HMO contract fell to 3.5 stars, below the CMS quality-bonus threshold)
– $TMUS -7.5%, T -6.5%, VZ -6.0% (wireless carriers slide as SPCX’s nationwide low-band spectrum acquisition raises the threat of direct mobile competition)
– ASTS -3.0% (falls after SPCX acquired spectrum ASTS had pursued, increasing competitive and spectrum-access concerns)
– $CVS -3.0% (only about 69% of Medicare Advantage members are in 4-star-plus plans for 2027, down from 81% for 2026)
– $AAPL -2.5% (no clear fresh catalyst identified; unusually large mega-cap decline despite higher Nasdaq futures)
– $DAL -1.5%, LUV -2.0%, $UAL -1.5% ($DAL missed Q3 profit expectations and sharply cut its FY outlook as surging fuel costs overwhelmed strong demand)
OpenAI Revenue Report Sinks AI, but the Rest of the Market Holds Up
An FT report that OpenAI’s revenue is running notably below earlier estimates sent AI shares sharply lower, but beneath the surface most stocks held up as Treasury yields eased and President Trump said the U.S. won’t attack Iran before the midterms.
The Calm Before the Storm
Lull in fighting between U.S. and Iran to be followed by big earnings by Amazon, Microsoft, Meta, and an economic data deluge. Also, a defense shortage?
Broadcom Bleeds, Semis Sink, Will Jobs Numbers Stink?
After a week that feels like pulling teeth, let’s check on the ‘rotation,’ the semiconductors and brace for the jobs report.
That’s a Wrap!
What a day! What a rally. Could have been a heck of a lot worse.
Markets opened on weakness Thursday, after a bloody day for stocks on Wednesday. Oil sold off, which was nice. That left some room for equities to rally ahead of Friday’s BLS labor market survey results for the month of May.
Thursday morning was defined by a sharp rotation out of tech. The Nasdaq Composite opened sharply lower before closing just below the unchanged mark. The S&P 500 added 0.4% for the day.
Health Care led the markets for the day, as providers and pharmaceuticals led health care. Humana ($HUM) and UnitedHealth ($UNH) gained 6.8% and 5.5% respectively. On the flipside, the semiconductors took a pounding as Broadcom ($AVGO) and Micron ($MU) surrendered 12.5% and 7.2% in that order. Nine of the 11 S&P sector SPDR ETFs closed the regular session in the green.
Quantum computing firm Quantinuum ($QNT) finally opened trading at $68 per share on the Nasdaq after its initial public offering. The company raised $1.68 billion after pricing the shares at $60 a piece.
The BLS is set to release its Jobs numbers for May tomorrow at 08:30. Consensus view is for growth of 105K non-farm positions. These results are expected to impact the outcome of the June FOMC meeting.
Have a good night, gang. It’s always a pleasure to pitch in relief of the ace of our staff, Dougie Kass. May you have a pleasant evening, and may God hold and protect those you love.
Sarge
Position: Long MU equity