Morning News: June 6, 2025
Posted by Eddy Elfenbein on June 6th, 2025 at 7:02 am

Xi’s Message to Trump: Rein in the Hawks Trying to Derail the Truce

China Central Bank Pumps Liquidity Into Markets Amid Cash-Crunch Concerns

India Central Bank Delivers Larger-Than-Expected Rate Cut to Support Growth

Russia’s Central Bank Cuts Key Rate Despite High Inflation

ECB Has Won Battle Against Inflation in the Eurozone, Villeroy Says

European Industry Contracts as Tariffs Pull Exports Lower

‘Nobody Likes Chaos’: Businesses and the Fed Wonder What’s Next for the Economy

Financial Repression Won’t Make Interest Rates Lower

The More You Work, the Richer You Are: A Case Against Trump’s Tariffs

How the Maker of the ‘Most Complex Machine Humans Ever Created’ Is Navigating Trade Fights

China Allows Limited Exports of Rare Earths as Shortages Continue

Companies Quietly Water Down Climate Claims in Latest Investor Reports

Europe Is Winning the Competition for Summer Gas, at Least for Now

Blocked by GOP and Trump, California Pivots in Clean-Air Fight

Deficit Politics Returns in Debate Over Trump Tax Cuts

US Household Debt Has Climbed to a Record — Are You Feeling the Pinch?

Can We Trust a Jobs Report From the Trump Administration? Yes, With Caveats.

Job Market Is Getting Tougher for College Graduates

Trump Removed Crypto Warnings From Retirement Plans. Will That Affect 401(k)s?

Private Equity in 401(k)s Isn’t as Smart as It Seems

Age Verification Mandates Create a Foreign Enforcement Fiasco

Musk Blinks First in MAGA Cockfight With Trump

Musk’s Threat to Withdraw Dragon Capsule Would Leave NASA with 1 Option: Russia

Harvard Wins Reprieve From Trump’s Foreign Student Ban

Shari Redstone Confirms Cancer Diagnosis While Facing Trump’s ‘60 Minutes’ Suit

Carmakers Use Stealth Price Hikes to Cope With Trump’s Tariffs

Shop Slow, Spend More: The Retailers Hoping That Customers Linger

Why U.S. Apparel Brands Are Becoming Tough Customers

The Stanley Cup’s Viral Moment May Be Waning. A New Brand Chief Has a Plan.

Chasing Big Money with the Health-Care Hustlers of South Florida

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Morning News: June 5, 2025
Posted by Eddy Elfenbein on June 5th, 2025 at 7:05 am

China’s Global Income Tax Crackdown Expands Beyond Ultra Rich

Whose Side Is the US On? Doubts Strain Alliances

Japanese Bonds Rise as 30-Year Auction Brings Some Relief

Global Bond Auctions Show Weaker Trend as Fiscal Angst Grows

Ireland’s Economy Grew Much Faster Than Expected on Tariff Stockpiling

ECB to Cut Rates as Trade Mess Weighs on the Economy

There Is an Alternative to the Dollar — It’s the Euro

Is There a Tariff End Game?

This Is the True Danger of Trump’s Tariffs

Biden’s I.R.S. Doubled Audits on the Wealthy, Data Shows

Economists Raise Questions About Quality of U.S. Inflation Data

Trump’s Budget Proposal Goes After Statistical Agency Funding

U.S. Is Trimming Back Its Collection of Consumer Price Data

‘Price Discrimination’ Is What Enables Lower Prices In the First Place

Not Now, Not In 10 Years, Social Security Isn’t Going Insolvent

JPMorgan Chase Sees Growth in Asia Pacific Private Credit Market

Wells Fargo CEO Goes from Fixer to Builder as Regulators Lift Punishments

Buy-the-Dip Retail Investors are Getting Bolder, Just When the Risks are Getting Bigger

Bill Ackman Is Tweeting Through It

Cathie Wood Goes Bargain Hunting: 3 Stocks She Just Bought

Elon Musk Urges Americans Take Action to ‘Kill’ Trump Tax Cut Bill

Tesla Is Being Eaten Alive by Chinese Rivals It Inspired

Cargo Ship Carrying Electric Vehicles Burns Off Alaska

Meta’s ‘Patriotism’ Spurs Shift to Military Technology

The Missing Engineers – There Aren’t Enough to Meet the World’s Growing Hunger for Power

The Green Transition Needs More Workers

Shale Drillers in Permian Basin Face Up to the Prospect of Peak Output

Walmart’s Flipkart Secures Approval for Direct Lending in India

P&G Plans to Cut 15% of Office Jobs Over Next Two Years

Kleenex-Owner Strikes a Deal for Its International Tissue Business

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Morning News: June 4, 2025
Posted by Eddy Elfenbein on June 4th, 2025 at 7:06 am

South Korea Inflation Cools, Easing Path for Rate Cuts

Slowing Australia Economy Vulnerable as World Growth Stalls

Bounced Checks Soar to Five-Year High Under Milei’s Austerity

Hot Core Inflation Expected to Keep Bank of Canada on Sidelines

Higher Tariffs on Steel and Aluminum Imports Go Into Effect

A New Era of Trade Warfare Has Begun for the U.S. and China

US Tariffs Are as Dangerous as They Are Illegal

Trump Bemoans How ‘HARD’ It Is to Strike a China Deal

China Weighs Ordering Hundreds of Airbus Jets in Major Deal

Trump Wants America to Make Things Again. Does It Have What It Takes?

Is Trump Unveiling a Crypto Wallet? His Associates Say Yes. His Sons Say No.

America’s Novel and Gratuitous Fiscal Crisis

‘Rules of Thumb’ About Deficits and Debt Are Bogus from Both Sides

How Trump’s ‘Big, Beautiful’ Bill Could End the FTC As We Know It

House SALT Deal Will Have to Change, Senate Leader Thune Says

We Are No Longer a Serious Country

Both Parties Need to Face Fiscal Reality

This Republican Agenda Is Generational Theft

Trump’s Pick for Fed’s Top Regulator Expected to Be Friendly to Wall Street

Wells Fargo CEO Scharf Enters Growth Era With Eye on Wall Street

Wells Fargo’s Asset Cap Has Been a Good Punishment

US Senators Press Antitrust Enforcers Over Rocket-Redfin Deal

An Illustrated Guide to Who Really Benefits From ‘No Tax on Tips’

Elon Musk Left the White House, but Tesla’s Protesters Aren’t Finished

Apple Downgraded by Needham Over AI Risks, Limited iPhone Upgrade Cycle

California’s Rooftop Solar Dreams Are Dimming From Rising Bills

Chart Industries and Flowserve Strike All-Stock Merger

The Billion-Dollar Sports Business That Got Dragged Into an FBI Investigation

Every N.B.A. Shoe Deal Is a Gamble. Converse Hit the Jackpot

Misery Loves Company? Bleak Week: Cinema of Despair Hits a Nerve

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CWS Market Review – June 3, 2025
Posted by Eddy Elfenbein on June 3rd, 2025 at 4:55 pm

(This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

The Best May Since 1990

On Friday, the S&P 500 closed out its best May in 35 years. It was also the second-best May since 1948.

The old Wall Street adage that we’re to “sell in May and go away” isn’t working this year. Not only was last month the best May, but it was also the best month since November 2023.

For the month, the S&P 500 gained 6.15%. If we include dividends, then the market was up 6.29%. For the year, the S&P 500 is up 0.51%, and with dividends, it is up 1.06%.

After suffering a major scare earlier this year, it’s amazing that we’re not far from new all-time highs. For the last two weeks, the S&P 500 mostly traded within a narrow range. In thirteen of the last 15 trading sessions, the S&P 500 has closed within 1% of 5,900.

We’ve had some disappointing economic news lately. On Monday, we got the ISM Manufacturing Index. I look forward to this report for a few reasons. For one, it’s usually reported on the first business day of the month. So many econ stats lag far behind what they’re supposed to be reflecting.

Also, the ISM is simple. They go to several companies and ask the purchasing managers if they’ve been buying more, buying less or buying the same. That’s it.

An ISM report above 50 means that the factory sector of the economy is growing, and below 50 means it’s shrinking. The ISM for May came in at 48.5. That’s down 0.2 from April. That’s negative but not by much. The ISM recently snapped a 26-month losing streak. The ISM doesn’t reach the worrying level until it drops down to 43 or 44.

Interestingly, the ISM Manufacturing report also showed that imports dropped to 39.9 last month. That’s the lowest since the financial crisis.

That’s not the only negative report on the economy. Also on Monday, the Census Bureau said that construction spending pulled back in April by 0.4%. So far this year, construction spending is running 1.4% of last year’s total.

On Tuesday, the Census Bureau said that factory orders fell by 3.7% in April. That comes after a 3.4% increase for March. Economists had been expecting a drop of 3.1%. Orders for commercial aircraft dropped by 51.5%. Motor vehicles, parts and trailers fell by 0.7%.

The OECD made waves on Tuesday when it cut its estimate for U.S. economic growth this year to 1.6%, and to 1.5% for next year. As key factors for the downgrade, the OECD cited tariffs and the policy uncertainty. The group also said that it expects inflation in the U.S. to increase.

To me, these are signs that the economy is expanding but at a slow pace. I don’t think we’re close to a recession, but that could change before the end of the year.

Growth Charges Ahead and Healthcare Lags

I’ve been surprised by the outperformance of growth stocks over value stocks over the past two months. Of course, some of this is to be expected as growth stocks love to outperform in bull markets. Still, I didn’t think it would be by this much.

Since the April 8 low, the S&P 500 Value Index has gained 13.3% while the S&P 500 Growth Index is up by 26.8%. That’s a hefty lead for such a short period of time.

If we dig down a little, an interesting fact about the market in May is that every sector gained except for healthcare. In fact, healthcare has been lagging the rest of the market for the last 30 months.

In the chart below, the red line is the S&P 500 Healthcare ETF, and the blue is the S&P 500.

I notice this because healthcare has usually been a very good sector to invest in, and there have been many big winners over the years. So many trends are in its favor. You have technology and demographics working together, plus a very large amount of government support.

Stocks like Johnson & Johnson (JNJ) and AbbVie (ABBV) are going for less than 14 times forward earnings. Merck (MRK) and Pfizer (PFE) are both trading less than eight times forward earnings. Pfizer currently yields over 7.2%.

We’re fortunate to have some solid healthcare names on our Buy List. Abbott Labs (ABT) is up more than 17% this year. Stryker (SYK) has been a great stock for us for many years.

I won’t predict an imminent turnaround for healthcare, but I will note that historically, it lags the market occasionally but not for long. Healthcare crushed the market from 2011 to 2015. It had a very good year in 2022 as well. The relative strength of healthcare is at its lowest point in 25 years.

Healthcare is also a quintessential defensive stock. That means it does well when the economy is flat on its back. Healthcare’s (and Value’s) day will come, but it needs a recession first.

Costco Rallies on Earnings Beat

Last week, I highlighted Costco (COST) and talked about why I like the company so much, if not the stock. More proof came last Thursday when the retailer posted another solid earnings report.

For its fiscal Q3, Costco earned $4.28 per share. That beat Wall Street’s consensus by four cents per share, and it’s up from $3.78 per share one year ago. Quarterly revenue rose 8% to $63.21 billion. That was $20 million more than Wall Street had been expecting. (It says something about your company when a beat of $20 million is basically a rounding error.)

On the earnings call, the company conceded that tariffs have been difficult for them. Specifically, Costco had to adjust their supply chain and, in some cases, raise some prices which I know they hate to do. I can’t say how much the impact has been. Costco is one of the few retailers that does not provide earnings guidance.

Same store sales were up by 8%, and e-commerce sales were up by 16%. Costco could actually benefit from the tariff policies because consumers might be more willing to lock in long-term discounts by buying Costco memberships. Still, tariffs are an issue. About one-third of Costco’s sales in the United States are in goods from outside the country.

Costco isn’t alone in fighting higher prices. Walmart (WMT) also said it will have to pass on higher costs.

On the company’s earnings call, CEO Ron Vachris said Costco has looked for ways to reduce tariff costs while keeping prices low. He said its buyers rushed orders to get them to the U.S. ahead of tariffs. It has rerouted goods from countries with higher tariffs to non-U.S. markets. And it’s sourced more items for its private brand, Kirkland Signature, in the countries or regions where the items are sold.

Even with tariffs, he said, Costco has lowered the price of some items including eggs, butter and olive oil. He said it’s also trying to lean into reasons that customers might sign up for or renew membership, such as extending the hours of its gas stations that sell discounted fuel.

On Friday’s trading, the shares rallied a little over 3%. As I’ve said, Costco is a wonderful company that I’d love to buy, but I still think it’s simply too expensive. Costco is currently trading at more than 50 times next year’s earnings. I don’t think that’s reasonable.

That’s all for now. The May jobs report is due out on Friday. Wall Street is looking for a gain of 125,000 new new jobs. I’ll have more for you in the next issue of CWS Market Review.

– Eddy

Morning News: June 3, 2025
Posted by Eddy Elfenbein on June 3rd, 2025 at 7:05 am

Global Markets Mostly Lower on Continued Trade Tensions; Eurozone CPI Data In Focus

Trump Tariffs Are Hurting US and Global Economy, OECD Warns

OECD Warns That World Growth to Slow Amid Trade Turmoil

Saudi Arabia’s Hurdles at Home Are Reshaping the Mideast Financial Order

Eurozone Inflation Falls Below Target

Switzerland Records Deflation for First Time in Four Years

Switzerland Poised to Pitch Tough New Capital Rules for UBS

Bank of England to Keep Cutting Rates But How Far, Fast Is Unclear, Bailey Says

BOJ’s Ueda Says Rate Hikes Will Only Come When Economy Is Ready

India Considers Easing Bank Ownership Rules as Foreign Interest Grows

Mismanagement Is Putting Dollar’s Global Standing in Jeopardy

Sahm: Inflation Expectations Are Now Just Tariff Expectations

899 — The Three Numbers Alarming the Bond Market

Investors Say They’re Moving Away From ESG as ‘an Umbrella Concept’

Economists Question G.O.P. Bill: Why Increase the Deficit in Good Times?

Newsom, Pritzker and High Tax Blue States Offer Red States a Huge Gift

Where Do I Fall in the American Economic Class System?

Consumers Are Financing Their Groceries. What Does It Say About the Economy?

Companies Rely on Delaware Courts. Lawyers Reap Huge Fees There.

Elon Musk Returns to His Tech Empire, Facing Questions of Inattention

China’s Manus Shows the Promise of AI Agents

A.I. Killed the Math Brain

Trump’s Big Steel Party Exposes Japan’s Growth Conundrum

Carlos Slim Is Quietly Becoming Pemex’s Partner of Last Resort

Meta to Buy Nuclear Power From Constellation as AI Demand Soars

Viper Energy to Acquire Sitio Royalties in $4.1 Billion Stock Deal

Toyota Industries $33 Billion Buyout Faces Investor Criticism Over Discounted Price

Hims Looks to Expand to Europe With Zava Acquisition

Dollar General Shares Zip Higher After Retailer Raises Outlook

The Economic Costs of Wearing Guardian Caps In the NFL

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Morning News: June 2, 2025
Posted by Eddy Elfenbein on June 2nd, 2025 at 7:08 am

Asian Manufacturing Activity Stumbles Again Under Weight of Trump Tariffs

Oil Leaps More than 3% After OPEC+ Keeps Output Increase Unchanged

Climate Startups Are Pausing Operations, Cutting Staff and Entering Bankruptcy as Trump Policies Bite

U.S. Dependence on China for Rare Earth Magnets Is Causing Shortages

Valterra Platinum Shares Start Trading in London

China Rejects Trump’s Accusation That It Violated Trade Truce

As Courts Call Tariffs Into Question, Trump Again Turns to His Favorite Tool

The Imports the U.S. Relies On Most From 140 Nations, From Albania to Zimbabwe

ECB Set to Cut Rates Again and Keep Options Open

Fed’s Waller Highlights a Path to 2025 Rate Cuts

Stanley Fischer, Groundbreaking Economist and Fed Vice Chair, Dies at 81

Why the S&P 500 Is Cruising Through Policy Upheaval

Buyers’ Strike Rocks US Long Bond as DoubleLine, Pimco Stay Away

A New Ratings Game: 3,000 Deals, 20 Analysts, Lots of Questions

Senate Begins Putting Its Stamp on Giant Trump Tax, Debt Limit Bill

A Peach and Apple Farmer’s Uphill Quest to Feed Poor Families, and His Own

Trump Plans to Offload National Park Sites, But States Don’t Want Them

The Corporate Culture Wars Have a Strange New Coalition

The C.E.O. Other C.E.O.s Turn To for Advice

Wall St. Is All In on A.I. Data Centers. But Are They the Next Bubble?

Arizona’s Water Is Vanishing Before AI Gets a Crack at It

Tesla Sales Plunge 67% to an Almost Three-Year Low in France

Elon Musk’s Chatbot Can Be ‘Non-Woke’ or Truthful, Not Both

How Europe Is Losing the Global Tech Race, in Five Charts

Amazon Hit by German Warning Over Price Controls on Marketplace

Bristol to Pay BioNTech Up to $11.1 Billion in Cancer Deal

Sanofi to Buy Blueprint Medicines for Up to $9.5 Billion in Boost to Pipeline

EU Fines Delivery Hero, Glovo $373 Million in Cartel Probe

Indian Billionaire Gautam Adani Comes Under New Scrutiny from U.S. Prosecutors

Can Gen Z’s Nostalgia Save Chain Restaurants?

How ‘Lilo & Stitch’ Became One of the Most Profitable Movies in Years

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Morning News: May 30, 2025
Posted by Eddy Elfenbein on May 30th, 2025 at 7:03 am

India’s Economic Growth Accelerates Despite Headwinds

Rising Inflation, Weak Production Put Bank of Japan in Tough Spot

How Russian Fortunes Stranded by US Sanctions Rocked Liechtenstein

Sliding Oil Prices Have Reopened the Door to Russian Crude

US Driving Season Starts Strongly for Oil Refiners

Twisty Path to a Deal: Is Nippon Steel Finally About to Land U.S. Steel?

Declining Inflation in Eurozone Nations Readies ECB for Rate Cut

The Swamp Wins Again, Even Against Elon Musk

Economists Cautiously Cheer Court Ruling Striking Down Trump’s Tariffs

Trump’s Tariff Options Slower, More Complex If Court Fight Fails

Trump’s Team Plots Plan B for Imposing Tariffs

Tariff Ruling Gives Businesses Hope, but They’re Soon Unmoored Again

This TACO Gives Trump Indigestion, So Watch Out

Trump Tells Powell He Is Making a Mistake by Not Cutting Interest Rates

The Bond Market’s Faith in America Is Facing a Severe Test

S.E.C. Drops Lawsuit Against Binance, a Crypto Exchange

Trump’s Tax Bill Has Nasty Surprise in SALT Fine Print for Some Rich Americans

How Trump’s Regulatory Rollbacks Are Increasing Costs on Americans

‘Bellwether of Risks’: What ‘Buy Now, Pay Later’ Defaults Say About the Consumer

Don’t Call It a Side Hustle. These Americans Are ‘Polyworking.’

Trump Taps Palantir to Compile Data on Americans

Chinese Students Ditch US Plans as Trump Vows Crackdown on Visas

Harvard’s Commencement Showcased a United University

The Judge’s Data Dilemma in the Google Search Case

Consultants are Taking Over the World’s Corner Offices

Nvidia Lays Out Worst-Case Scenario in Bid to Open China Market

Shoe Carnival Backs Guidance, Plans Focus on Premium Brands

Soaring Costs Expose a Trans-Atlantic Chocolate Divide

Celsius Looks Beyond Fitness Buffs in New Marketing Campaign

Wall Street or Vegas: Kalshi Ramps Up Battle Over Legal Gambling

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Morning News: May 29, 2025
Posted by Eddy Elfenbein on May 29th, 2025 at 7:03 am

Economic Debate Begins on Impact of ‘Military Keynesianism’

OPEC+ Prepares Third Dose of Oil Shock Therapy

UK Gas Generation Plunges as Wind Surge Turns Prices Negative

Japan’s Debt, Now Twice the Size of Its Economy, Forces Hard Choices

Bank of Korea Cuts Rates, Slashes 2025 Growth Outlook

Bank of Mexico Cuts Economic Growth Forecasts

Export Controls Are Endangering the Fragile U.S.-China Truce

Companies Turn to Private Credit During Tariff Turmoil for Loans

Trump Trade Strategy Roiled by Court Blocking Global Tariffs

Stocks Jump After Court Blocks Trump’s Tariffs

If Anything, Bond Markets Are Returning to Normal

The Fed Forecasts Stagflation

Opposite Peter Orszag and His Opposites, Government Spending Doesn’t Cause Inflation

The Tax Bill Is Big, But Certainly Not Beautiful for Small Business

The Allure (and Complications) of Trump’s ‘Golden Shares’

DOGE Has Failed to Halt Increases in Federal Spending

A Disillusioned Musk, Distanced From Trump, Says He’s Exiting Washington

The Techno-Futuristic Philosophy Behind Elon Musk’s Mania

If America Doesn’t Want Harvard, Somebody Else Will

The AI Job Suck Is the China Shock of Today

Nvidia Eases Concerns About China With Upbeat Sales Forecast

Senators Bash Nvidia’s Plans for Facility in China

United and JetBlue Form Alliance to Sell Seats on Each Other’s Flights

Tariffs Turn Porsche’s Headwinds Into a ‘Violent Storm’

Best Buy Falls After Trimming Outlook on Hit From Tariffs

Kohl’s Beats Expectations in Wake of Dramatic CEO Firing

Foot Locker Swings to Loss Ahead of Acquisition by Dick’s

One Way to Sell Beer in Britain? Buy Into a Soccer Team.

Sports Stadiums Are Monuments to the Poverty of Our Ambitions

The Rise of the Japanese Toilet

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Morning News: May 28, 2025
Posted by Eddy Elfenbein on May 28th, 2025 at 7:05 am

Doing Business in China Is Getting Harder, but Its Exports Are Hard to Resist

Japan Bonds Draw Weak Demand as Rise in Superlong Yields Sparks Concern

Now Is the Moment to Pressure Putin, Not Appease Him

Russian Central Bank Warns of Oil Price Risks as it Defends High Rates

Alberta Wildfires Threaten an Oil Industry Working to Refill Dry Tanks

Central Bankers Bow to Political Winds When It Comes to Climate, Study Shows

Krugman: A Letter to Europe

Germany’s Jobless Numbers Tick Higher

ECB Says Lagarde ‘Determined’ to Complete Her Term

UniCredit to Double Stake in Greece’s Alpha Bank to Around 20%

US Banks Tiptoe Toward Crypto, Awaiting More Green Lights from Regulators

The GOP’s Budget Bill Will Pass in Spite of Itself

Musk Says He’s ‘Disappointed’ That Trump Tax Bill Raises Deficit

Income Taxation: TheTap Root of Collectivism

Fisher: On the Big Beautiful Bill

Why You Don’t Lose Money in Bonds (If You Wait Long Enough)

Wall Street’s Rush to Launch Vanguard-Style Funds Draws Warnings

Boston Pushes Harvard, Other Colleges for Money Even as Trump Steps Up Attacks

US Home-Refinancing Gauge Falls to Three-Month Low as Rates Near 7%

‘We’re In a Holding Pattern’: Home Sales and Building Slump in the Face of Uncertainty

EU Aims to Cut Red Tape, Boost Funding to Lure Tech Startups

DeepSeek Unveils Update to R1 Model as AI Race Heats Up

Watchdog Probes Illegal Use of Starlink Service in South Africa

Droga Steps Down as CEO of Accenture Song, the Marketing Unit He Helped Build at Consulting Giant

Honeywell Enters Cooperation Pact With Elliott Before Breakup

Brazil Sues EV Giant BYD Over ‘Slavery’ Conditions at Plant

Jeep Maker Stellantis Names Americas Boss as CEO

GM’s Mary Barra on the Auto Giant’s EV Strategy

Macy’s Cuts Profit Outlook Despite Solid Spring-Season Sales

Luxury Brands Are Paying for Over-the-Top Price Hikes

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CWS Market Review – May 27, 2025
Posted by Eddy Elfenbein on May 27th, 2025 at 5:51 pm

(This is the free version of CWS Market Review. If you like what you see, then please sign up for the premium newsletter for $20 per month or $200 for the whole year. If you sign up today, you can see our two reports, “Your Handy Guide to Stock Orders” and “How Not to Get Screwed on Your Mortgage.”)

The stock market got a nice bounce today after President Trump said he’s going to delay the 50% tariffs on the EU.

It’s interesting how any news of a tariff pause sends the bulls charging but any warning of tariffs to come brings out the bears. It’s clear that Wall Street doesn’t like tariffs.

At one point, the Dow was up more than 740 points today. The S&P 500 was up by 2.0% while the Nasdaq was up by 2.5%. I talk a lot about the 200-day moving average. This is a good example of why. The S&P 500 bounced almost perfectly off its 200-DMA. The Russell 2000 was particularly strong today.

President Trump said he’ll push the EU tariffs back to July 9. He’s making the move as part of a request from Ursula von der Leyen who is the president of the European Commission. The original date for the tariffs was for June 1.

President Trump took to Truth Social: “This is a positive event, and I hope that they will, FINALLY, like my same demand to China, open up the European Nations for Trade with the United States of America.” The EU said it will fast-track trade talks with the U.S.

Through May 19, the S&P 500 had put together a very nice run of 17 up days in 20 sessions. That came to an end last week as the index fell on Tuesday, Wednesday, Thursday and Friday. Today’s rally is walking back most of last week’s damage.

The 30-year Treasury yield fell back below 5%. There were some concerns last week when a Treasury auction showed unusually light interest. This was particularly worrying to some because it shortly followed the credit downgrade from Moody’s.

Interestingly, shares of Tesla (TSLA) got a nice boost today after Elon Musk said he’s going to pull back on his political endeavors. Tesla sold only 7,261 cars in Europe in April. That’s down 49% from last year. The overall EV market saw an increase of 34.1%. Shares of Tesla have lagged the market for more than three years.

When a stock goes up, shareholders will forgive most anything. But when a stock starts to slide, their patience wears thin. All things being equal, I prefer to invest in a company whose CEO keeps a low profile.

We’re not quite done with earnings season, but we’re getting very close. So far, 95% of the companies in the S&P 500 have reported results. Of those, 78% have topped estimates. This week, we’re getting Nvidia’s (NVDA) earnings report which will be very closely watched. The report is due out after tomorrow’s closing bell. Wall Street expects earnings of 75 cents per share. That’s up from 61 cents per share for last year’s fiscal Q1.

The other earnings report to look out for will come from Costco (COST). I highlighted the company last week and explained why I’ve been such a big fan over the years. Last time, Costco had a rare earnings miss ($4.02 versus $4.10 per share). This time, Wall Street expects earnings of $4.23 per share. Costco’s earnings report is due out after the closing bell on Thursday.

We also had good economic news this morning. It seems that consumers are in a much better mood. This morning, the Conference Board’s Consumer Confidence Index came in much stronger than expected. For May, Consumer Confidence was 98.0. That’s an increase of 12.3 points over April. For May, Wall Street had been expecting 86.0.

This snaps a streak of five straight monthly declines. What caused the surge? It seems that President Trump’s decision on May 12 to hold back on the most severe tariffs certainly played a role.

The present situation index increased to 135.9, up 4.8 points, and the expectations index posted a major surge to 72.8, a 17.4-point gain. Investors also showed more optimism, with 44% now expecting stocks to be higher over the next 12 months, up 6.4 percentage points from April.

Views on the labor market also improved, with 19.2% of respondents expecting more jobs to be available in the next six months, compared with 13.9% in April. At the same time, 26.6% expect fewer jobs, down from 32.4%. However, the level of respondents saying jobs were “plentiful” edged higher to just 31.8%, while those saying employment was “hard to get” increased to 18.6%, up 1.1 percentage points.

Consumer confidence was higher for every income bracket. Consumer confidence is an interesting metric to watch because it’s not visible and it’s hard to measure, but if you don’t have it, it can be terrible.

Last week, we had a great earnings report from one our Buy List stocks. Intuit (INTU), the TurboTax people, reported earnings of $11.65 per share. That was up 18% over last year, and it beat Wall Street’s consensus of $10.91 per share.

The CEO said Intuit is “becoming a one-stop shop of AI-agents and AI-enabled human experts to fuel the success of consumers and small and mid-market businesses.”

But the best news is that Intuit raised its full-year guidance. Intuit now see its profits ranging between $20.07 and $20.12 per share. That’s a growth rate of 18% to 19%. The previous guidance had been for 13% to 14%.

Shares of Intuit jumped 8.1% on Friday, and another 3.4% today. The shares hit a new 52-week high today. I won’t give you the “hard sell,” but you can sign up for our premium newsletter here. This is where we discuss our Buy List in greater detail.

The Federal Reserve doesn’t meet for another three weeks, but tomorrow the Fed will release the minutes of its last FOMC meeting. At that meeting, the Fed decided against raising interest rates, which was widely expected, but I’ll be curious to see what the reasoning was inside the Fed.

Over the last few weeks, the market has gradually changed its outlook for the Fed. Wall Street no longer sees the Fed as being willing to lower rates so aggressively.

Futures traders currently see the Fed lowering interest rates in September, but even that’s not an overwhelming proposition. The current probability of a September rate cut is 62%. The market only expects two rate cuts for the rest of this year.

Also today, the Atlanta Fed’s GDPNow model sees Q2 growth of 2.2%. That’s down a little from the prior forecast of 2.4%. The estimate for real gross private domestic investment growth fell from +0.7% to -0.2%. Today’s Case-Shiller Index on home prices showed the first monthly decline in home prices since 2023. The data is seasonally adjusted.

On Thursday, the government will update its report on Q1 GDP growth. The initial report said that the economy grew by only 0.3% for the first three months of this year. I don’t expect to see much of a change.

That’s all for now. I’ll have more for you in the next issue of CWS Market Review.

– Eddy