Stock Market Update

[BRIEFING.COM] The major averages are little changed at midday with the S&P 500 (-0.1%) trapped just below its unchanged level after seeing some early volatility while the Nasdaq (-0.3%) underperforms.

Investors returned from yesterday's Juneteenth closure with some ongoing cautious optimism that the Israel-Iran conflict will not broaden after President Trump said that he will decide on a final course of action over the next two weeks.

The market also received an early boost from comments made by Fed Governor Waller, who said that a July rate cut is possible. Those remarks have helped Treasuries rise off their early lows with the 10-yr yield down two basis points at 4.38% after marking an early high just north of 4.44%.

Equities have not been able to sustain their higher start with some pressure from the technology sector, and specifically, chipmakers after The Wall Street Journal reported that the Trump administration is planning to revoke waivers that allow chip companies to use American chipmaking technology in China. The PHLX Semiconductor Index (-0.8%) has narrowed this week's gain to 1.9% while the technology sector (-0.3%) remains up 0.8% for the week.

Besides chipmakers, Accenture (ACN 284.42, -21.96, -7.17%) has also exerted some pressure on the technology sector even though the company beat Q3 expectations, issued above-consensus EPS guidance for FY25, and raised its dividend by 15%.

The health care sector (-0.4%) has also been a laggard this morning, continuing its poor week (-2.6% week-to-date).

On the upside, the energy sector (+0.7%) has held the lead since the start even though crude oil has spent the bulk of the day in negative territory. It is currently down $0.10, or 0.1%, at $73.40/bbl, trimming this week's gain to 0.3% versus a 0.7% week-to-date advance in the energy sector.

In earnings, Kroger (KR 72.20, +6.68, +10.19%) is rallying toward its record high from April (73.63) after beating quarterly expectations, reaffirming its guidance for FY25, and raising its comparable sales guidance for FY26.

Kroger has helped keep the consumer staples sector (+0.7%) among today's leaders while the discretionary sector (unch) trades little changed even though CarMax (KMX 68.34, +4.02, +6.24%) and Darden Restaurants (DRI 223.17, +0.42, +0.19%) beat their respective earnings expectations.

Reviewing today's economic data:

• The Philadelphia Fed Index hit -4.0 in June (Briefing.com consensus 0.3) unchanged from May.
• Conference Board's Leading Economic Index was down 0.1% in May (Briefing.com consensus -0.1%) after falling a revised 1.4% (from -1.0%) in April.