Morning in New York: stock indices in search of a foothold

Daily review and forecast of events on the U.S. stock market from Mikhail Denislamov, Deputy Director of Capital Markets Research, Freedom Broker.

The United States launched another series of strikes on air defense systems, radar stations and drone control centers in Iran. After the Central Command announced the completion of the operation, oil prices reversed downward and US stock index futures turned upward. US President Donald Trump said he was responding to Tehran's request to halt the shelling, but warned of a possible resumption of strikes if an agreement was not signed. At the same time, the impact of the new round of tensions on the talks remains unclear. According to media reports, the US pressure on Iran through military action does not make it more amenable to an agreement, and the main points of uncertainty remain its nuclear program and access to frozen assets.

This Thursday's macro releases will refine the assessment of inflationary pressures, including the impact of expensive energy and supply chain disruptions following the consumer inflation (CPI) data released the previous day. Average market forecasts for the overall PPI for Ma suggest a 0.6% m/m rise after 1.4% a month earlier, while the consensus for the core indicator (excluding food and fuel) is for a 0.3% m/m rise after 1% in April. In addition, the statistics of unemployment claims for the week to June 6 (consensus: 216 thousand, previous value: 225 thousand) will be released.

Adobe (ADBE), RH (RH) and Lennar (LEN) will present quarterly results after the close of the main session. Adobe's report will be important for assessing the demand for enterprise software and the pace of monetization of AI functions.

Futures on American stock indices demonstrate positive dynamics. We assess the balance of risks for the upcoming session as neutral with increased volatility. The market may be supported by expectations of PPI growth slowdown, but escalation of the Middle East conflict and aggravation of problems with transportation through the Strait of Hormuz limit the growth potential. Resistance for the S&P 500 is at 7350 points, support is located around 7200.

- Navan (NAVN) shares are up 19%, reacting to the release of its fiscal year (FY) 2027 first-quarter earnings and an increase in its own guideposts for the period. The company's revenue increased 40% YoY, gross bookings reached $3.1 billion, and adjusted operating profit rose to $24 million from last year's $3 million. Current FY guidance for revenue is revised from $866-874 million to $907-913 million, and non-GAAP operating profit is revised from $58-62 million to $76-80 million.

- Oracle (ORCL) stock is down more than 10% despite strong results for its fiscal fourth quarter, in which the issuer's revenue grew 21% YoY and adjusted EPS rose to $2.11 from last year's $1.7. The selloff was triggered by the announcement of massive spending on cloud and AI infrastructure in FY 2027. Capital investment is planned for up to $95 billion, and the company also intends to raise about $40 billion. This raises concerns about its free cash flow.

- Stitch Fix (SFIX) shares are gaining more than 1% on the back of its fiscal third quarter earnings release. The company's revenue rose 4.7% YoY to $340.3 million, with a consensus of $332.6 million, and loss per share came in at $0.01, with average guidance of $0.05. The full-year revenue guidance was raised. The positive market reaction was driven by signs of business stabilization: the number of active customers grew 0.9% QoQ to 2.309 million and customer retention improved for the seventh consecutive quarter.

- Shares of Oxford Industries (OXM) are down about 7%, although its adjusted EPS for the first quarter came in at $1.39 and revenue reached $391.4 million with consensus of $1.27 and $391.2 million, respectively. The company's second-quarter outlook was pressured by revenue guidance in the range of $380-400 million against the market's average guidance of $413.9 million and EPS in the range of $1.2-1.4 versus market-wide expectations of $1.46.

June 10 trading on U.S. stock exchanges ended in negative territory near the daily lows. Dow Jones lost 1.87%, S&P 500 fell by 1.62%, Nasdaq 100 fell by 1.98%, Russell 2000 fell by 1.1%. This dynamics was due to the capital outflow from the shares of high-tech companies, primarily chipmakers. The SOX sector index has already corrected by more than 12% since June 3 amid overheating of the segment after a strong rally.

Energy (XLE: +1.5%) and non-cyclical consumer goods producers (XLP: +1.65%) were the leaders of growth. The outsiders were industrial companies (XLI: -3.38%), producers of raw materials (XLB: -2.30%), as well as the IT sector (XLK: -2.29%). Investors are shifting from securities with high Beta to defensive instruments.

Most of the major tech companies went negative. Some representatives of the "Magnificent Seven" lost more than 2%. Reports about OpenAI's negotiations to lease a 10 GW data center for 20 years with possible funding from Nvidia (NVDA: -3.73%), as well as information about support for the Anthropic chip project from Alphabet (GOOGL: -2.16%) confirm the high demand for AI infrastructure. However, this news failed to offset the pressure from the reassessment of risks in the sector.

The price of WTI oil rose by 2.1%, although by the close it had moved away from intraday highs. Quotes were supported by Donald Trump's toughening rhetoric towards Iran and reports about the likelihood of new strikes on its infrastructure facilities. At the same time, the market does not yet perceive the latest exchange of blows between the US and Iran as a factor of immediate escalation, but the settlement of the conflict by diplomatic means is assessed as more difficult.

Macroeconomic statistics was generally positive, although it did not affect the general course of trading. Consumer price index for Ma according to consensus rose by 0.5% m/m after 0.6% in April. On an annualized basis, consumer inflation stood at 4.2%. Core CPI rose 0.2% mom (consensus: +0.3%, April: +0.4%). The data indicate a limited impact of high energy prices on inflation.

Yields on treasuries at the far end of the curve rose by 1-2 bps. Placement of 10-year securities was close to market expectations with the strongest demand since September 2025.

- Devon Energy (DVN: +5.8%) provided updated guidance following its merger with Coterra, alleviating some of the concerns about possible pressure on the stock after the deal. The company's own production guidance for the second quarter came in above consensus. Plans to return free cash flow to shareholders were confirmed. Capital expenditures efficiency assessment has been improved. At the same time, analysts note the wide range of the outlook for the second quarter, limited updates for 2027 and no expansion of the company's security holder payout program.

- DraftKings (DKNG: +4.3%) received positive estimates for its Predictions platform after speaking at the Jefferies Nasdaq Investor Conference. The company's net revenue grew 24% YoY in the most recent quarter, driven in part by a 30% increase in revenue from its sports betting segment. Management does not see a significant spillover into the prediction markets sector. At the same time, the World Cup is expected to support user engagement and the volume of forecasts in the second half of the year.

- Robinhood Markets (HOOD: +3.1%) has been authorized to act as an underwriter of the IPO. The company's CEO Vlad Tenev said that the company intends to change its approach to this market by expanding access to it for retail investors.

- Old Dominion Freight Line (ODFL: -5.1%) has come under pressure following the expansion of Amazon's (AMZN: -2.5%) freight service in the US. The company has opened up to third-party customers a prefabricated freight service, in which shipments from different shippers are combined on a single flight. Previously focused mainly on deliveries to Amazon's network, the service is now available to all companies and destinations. This increases competition for traditional freight operators, including Old Dominion.

- Chewy (CHWY: -2.1%) reported first-quarter adjusted EBITDA above average expectations on consensus revenue. The stock was pressured by weak operating metrics, with active customers, net user additions, and net sales per active customer coming in below estimates. The company also worsened its full-year guidance for net sales, noting pressure on premiumization and related product sales.

This article was AI-translated and verified by a human editor