Where Are Markets Today?
European and U.S. futures are modestly higher as of Tuesday, June 10, as investors reacted to the recent developments in continuing U.S.–China trade talks being held in London. FTSE 100 futures are 11 points higher, DAX 62 points, CAC 40 23 points, and Italy’s FTSE MIB 83 points higher—indicating better sentiment on continental Europe.
On the US side, Dow futures are 124 points (+0.29%) higher, while S&P 500 and Nasdaq 100 futures are up 0.4% and 0.5%, respectively. This upbeat sentiment comes after Monday’s relatively quiet session when investors by and large stayed on the sidelines as they waited for crucial geopolitical and economic events due to take place this week.
Markets are rallying to signs of momentum in London-based trade talks between U.S. and Chinese officials. While no official deal today will materialize, the mood of negotiations has improved. Optimism comes after signs that both sides are taking steps to dial back tariff threats, potentially sidestepping the reintroduction of wide-ranging trade barriers. For both European and U.S. markets—both so deeply ingrained in global supply chains—this translates to breathing space. As optimism increases, investors are starting to move into cyclicals and tech stocks, two of the most vulnerable to trade disruptions. By Jim Cramer.
Investors are still cautious about the economic calendar. While yesterday’s labor data did not bring any sensational surprises, markets are still pricing a fine balance between easing inflation and obstinate wage pressures. Today’s U.K. Claimant Count and U.S. Average Earnings Index reports are seen as gauges of monetary policy expectations. If the data indicates a cooler labour market, it can add to dovish bias for central banks—friendly to equity and risk assets. A firm upside surprise, nonetheless, would revive yield volatility and moderate market optimism. Looking forward, futures are trading in a cautiously positive range, sentiment anchored by hopes of geopolitical progress and closely eyed economic indicators. A London breakthrough or dovish data surprises could open the door to a more dynamic upsurge, but for now, markets are taking a deliberately middle road.
June 10, 2025: Key Index Trading Levels
- Nasdaq Composite: At approximately 16,900, down roughly 0.5% for the day with the volatility of mega-cap technology stocks
- S&P 500: Around 6,150-6,200, mildly bullish, trading just under the resistance of 6,100-6
- Russell 2000: About 1,950, flat, lagging other indexes YTD
- Dow Jones Industrial Average: Finished close to 39,800, slightly up, aided by advances in industrial and defense shares
The “Magnificent Seven” & S&P Landscape
Broader markets were rattled recently with recent public row with Tesla—tech giant Tesla dropped 14% after Twitter feud with President Trump, bringing down broad indices including the S&P 500 and the Nasdaq
Though the broader “Magnificent Seven” remain atop the index driver benchmark, over-concentration risk is hanging over it. Even with S&P 500 weighting now above 30%, the recent trend of accelerating earnings revision is showing upside momentum can carry it through to new highs of approximately 6,500.
Drivers of the Market Move
U.S. and European markets’ key drivers on June 10
With global markets inching up, sentiments remain precariously poised against the backdrop of news on trade, political declarations, and the release of jobs-related data. The three most significant market drivers today are:
1. U.S.-China Trade Talks Renew Hope
Markets are supported by positive news from U.S.-China trade talks in London. Bullish statements from President Trump have assisted sentiment, with hopes for reducing tariffs on technology, rare earths, and broader limits on trade. This is supporting cyclicals and technology in European and U.S. futures, with investors beginning to return into names exposed to global trade flows.
2. Trump’s Economic and Trade Narrative Brings Volatility
Donald Trump’s fresh attacks on the Federal Reserve calling the economy “a house of cards,” and his new calls for “America First” trade policies is putting caution into markets. His words are taken as signals that more dovish policy is coming or there is further tariff escalation on the way. This dual message has markets on edge, particularly those exposed to disruption from rate and trade volatility.
3. Labour Data Points Towards Dovish Policy Bias
Investors are also reacting to recent labour statistics: strong jobless claims and more modest wage increases—added to today’s Claimant Count and U.K. Average Earnings Index—are cementing expectations of increasingly easing labour markets. They add to the less hawkish central banking theme, pushing bond and equity markets for yield. Failure of today’s figures to meet expectations would add to the dovish pivot theme, further supporting risk assets; a sharp upside surprise, however, could prompt pause. Tactically, markets are navigating through a combination of guarded optimism based on trade advances, dampened by political uncertainty and spotty economic news. Leaders’ rhetoric and labor reports later in the day will be instrumental in deciding whether this configuration coheres into a risk-on rally of substance or relapses into caution.
DIGESTING ECONOMIC DATA
The TRUMP Tweets And Their Implication
With President Trump escalating his digital presence in the buildup towards upcoming key political deadlines, streams of commentary on social media are influencing markets in live time. From calling for a “total border rebuild” through questioning the Federal Reserve’s handling of the economy—is it “a house of cards?”—President Trump has flipped into campaign mode with his aggressive tone. Even the language is customary, but the tempo and thematic cutting edge are building policy uncertainty with it. Financial markets respond with increased volatility—even more among rate-sensitive assets, commodities, and politically-exposed equities
Most importantly, Trump’s disparagement of “globalist trade agreements,” as well as his support of the “America First only” mantra, is sparking fears of tariff wars anew. Those sentiments, coupled with the inception of #Trump2025 on social media and reviving of the #SaveAmerica slogan, are reviving protectionism-minded fiscal policy fears. Equity markets—focusing particularly on multinationals and companies with global supply links—will need to reassess risk premiums as uncertainty over U.S. policy on trade returns with a vengeance. The sentiments also carry currency market repercussions, with the strong dollar bias potentially being eroded through anticipation of unilateral action on trade and foreign retaliation.
While all of this is taking place, Trump’s repeated calls for less central bank intervention and his quote stating that “central banks can’t be trusted—Bitcoin is freedom,” are only helping to add more ammunition for pro-crypto narratives. The digital asset sector has adopted more Trump-style language, labeling Bitcoin and blockchain-denominated assets as the solution for fiat volatility. Musk’s support and establishment of private technology founders is already indication of support for Web3 and decentralized infrastructure should his movement take control of politics again. Bitcoin is already trending upward with these narratives, and those flows are crossing over into Ethereum with more speculation that it will be accepted politically.
Lastly, the Trump-fueled internet campaign with mantras like “we’re reviving the republic” and “the mission is bigger than any one man,” is feeding into a broader culture of polarization that can inject more policy uncertainty into standard rational asset price models. Today’s markets respond not only to hard facts—but to viral opinion, sound bites, and momentum politics. This narrative volatility can be the signature of the 2025-2026 cycle, where investors will need to account for more than fundamentals of the economy but rather the algorithmic virality of politics
Seasonal Employment Has Recorded A Decrease
We are following closely a sharp 21% decrease in U.S. temp services employment from its recent peak, a leading indicator typically ahead of overall economic declines. Confirming the trend, as well as a warning signal to forward-looking market players, are government statistics from the Bureau of Labor Statistics. Temp employment has been a leading indicator of labour cycle reversal—deteriorating well ahead of permanent hiring turning down. Contraction under way is more severe than temporary job losses in 2008, with declines averaging around 20%, a signal of atypical pressure building in the labour market.
From a perspective at Zaye Capital Markets, this loosening is a signal of diminishing short-term business confidence, particularly from small- and medium-sized businesses employing contingent workers as a way of permitting operating flexibility. Fed rate hikes and reduced liquidity from open market operations are most likely magnifying this impact, reducing incentives for hiring payrolls. This moderating demand for hiring workers might be transferred into subdued wage growth and weakening consumer trends—both factorssignificant in forecasting sustainability within U.S. GDP momentum through Q3 2025.
On the valuation side, most-exposed industries are most sensitive towards discretionary spending, with retailers and hospitality falling into this group. Nevertheless, attention from analysts should be on under-valued consumer staples as well as healthcare defensive industries, whose history suggests they perform well in economic downturns. These industries offer earnings resilience as well as pricing power amidst weakening labour signals. One should watch out for revisions on nonfarm payrolls as well as employment cost indices for verification of this weakening labour.
Consumer Credit Rises as Signals Remain Mixed
We see a multifaceted shift in consumer behavior, with the most recent Federal Reserve figures showing a surprise rise in consumer credit by a total of $17.87 billion in April 2025—far higher than a predicted growth of $10 billion. A majority of growth is being fueled by non-revolving loans such as car loans as well as school loans, an indication consumers continue using debt even with increasing interest rates as well as a consistent inflation environment. Something similar has been a characteristic behavior in past inflationary cycles. While growth might be a show of resilience on its face, it also is a signal of mounting economic strain beneath.
At Zaye Capital Markets, we consider this rise in borrowing a two-edged indicator. On one hand, insofar as it is supporting short-term consumer spending—a key element of US GDP, still disproportionately dependent on consumer expenditure. On the other, revolving card balances continue to linger just shy of all-time highs at over $1 trillion, suggesting increasing household debt. In the absence of synchronized income growth or levelling labour market trends, this trend has the potential to become a more systemic debt-servicing issue in H2 2025. Debt-fuelled spending should not be confused with economic health in markets; cracks in repayment are only just starting to show.
From a valuation perspective, this environment points to consumer discretionary names with exposure towards lower end income groups. Contrasting this, there is relative value in big cap utilities as well as fintech lenders with conservative underwriting. These assets would be more resistant to a normalization in credit. We would then be inclined to shift our attention to delinquency trends as well as forward retail top-line, as this should paint a more accurate picture regarding how much lending is on consumption rather than hidden financial stress.
Underlying Strength Eroding Labor Market
The May 2025 job report paints a two-sided picture of America’s job market. While the headline unemployment remains stable at 4.2%, unemployment flow has crept over a 6-month moving average, portending softness beneath the surface. Revised data also show 95,000 fewer job additions from March to April compared with previous reports. Revision suggests a weakening job growth momentum in terms of an increasing part of the job market being shed rather than absorbed—bad news for consumption-driven recovery.
At Zaye Capital Markets, we suspect this slowdown in labour is partially accounted for by business caution induced by tariffs. With renewed trade tensions and policy uncertainty under this administration, companies seem to be limiting payroll expansion amidst uncertainty over supply chain costs. Last month’s 625,000-worker decline in labour force participation also distorts unemployment optics and confirms that the employment-to-population ratio—long a more stable measure—is a better metric of labour market weakness in this cycle.
Accordingly, defence is required on sensitive labour industries like small-cap industrials and cyclicals. Conversely, undervalued large-cap healthcare and technology shares with heavy automation footings or non-cyclical demand can be entry points. Initial jobless claims and wage inflation reports will be central in helping to determine whether such labour imbalances are a temporary state or an indication of a more profound economic adjustment.
Manufacturing Decline Reflects Structural Imbalance
U.S. factory payroll growth declined 0.7% on a annual basis in May 2025, building on a consistent trend of sector weakness. Readings continue a trend as early as 2023, with factory employment unable to take hold, despite overall job market resilience. Downward trend is worrisome particularly with stagnant new orders and continued production logjams. It suggests U.S. production remains hamstrung by weak demand and high costs, lowering its contribution to economic recovery.
According to Zaye Capital Markets, however, this gap between shedding jobs and over 800,000 factory posts open is structural. Despite all the digital transformation and automation intended to improve productivity, takeup remains patchy. Most businesses still struggle with finding people with the right skillsets, while productivity gains from digitisation remain elusive at scale. That mismatch between labour readiness and demand still hinders growth opportunities in capital goods as well as industrial supply chains.
Furthermore, with Chinese exports falling 34% from last year in May, a bout of supply chain fragility is reemerging. These disruptions threaten input dependability as well as production planning, especially for US producers relying on foreign parts. Therefore, industrials, as well as mid-cap exporters, should be watched closely. Opportunity, though, perhaps lies with undervalued US logistics as well as automation technology stocks, which stand to benefit from onshoring trends as well as digital retooling. Close watch should be kept on future ISM Manufacturing PMI releases as well as inventory levels for clarity on second-half pace.
Revisions Weaken Confidence In Headline Payroll Strength
The fourth consecutive downward revision in U.S. nonfarm payrolls, with April’s reading reversed from 177,000 to 147,000, serves yet again to highlight labour market softness lately. While a 30,000 cut might appear conservative compared with a 65,000 downward revision in March, it is a trend of job formation overestimation. The revision process, driven by initially flawed survey samples, brings into question headline number credibility, especially if they continue to paint a more optimistic picture than actual.
At Zaye Capital Markets, we interpret this trend as an early signal for economic slowdown hiding behind statistical lags. Prior BLS history bears out our hypothesis with a consistent history of preliminary payroll overestimates averaging 0.2% a month. Therefore, the narrative of persistent labour market health must be interpreted more critically. New York’s reclassifying home health workers—artificially distorting industry-level employment statistics—only serves to add uncertainty and reduce monthly payrolls’ worth as a market sentiment indicator in isolation.
On the other hand, analysts would be more inclined towards other indicators such as employment-population ratios, working hours, and real wage growth. Relative value for equities would find its place in lower macro labour distorting areas such as software and semiconductors, where visibility on earnings is more shielded. Underpriced opportunity also lies in selective healthcare services, i.e. where demographic drivers underpin secular demand regardless of payroll volatility. June’s labour market print—not its headline, but whatever revisions ultimately bring—is what everyone’s awaiting.
Prime-Age Labor Force Participation Declined
The US prime-age labour-market participation rate dropped in May 2025 to 83.4% from its cycle peak, still well below historic troughs such as the 81.5% level in recession-2009. That small decline, not dramatic on its own, suggests a softening in labour-market participation, particularly from workers aged 25-54—the population traditionally considered the economic backbone. Extremely weak 139,000 job additions, underpinning stable unemployment, covers this weakening participation, and the headline stability is somewhat misleading.
From our perspective at Zaye Capital Markets, this is a trend more worthy of human notice. While part of this decline is a manifestation of demographic trends such as early retirements or postponed health-related retirements, overall it is a shrinkage in the labour force base at a time with demand for quality labour still on an upward trend. A diminishing prime-age labour supply constricts capacity and drives upward on wage pressures, which, without productivity growth, would be a cause for cost-push inflation concern. It also contradicts the overall theme for an economy achieving sustainable momentum—especially with other forward-looking indicators such as job revisions as well as temporary hiring also trending down.
It is a call for analysts to look past job count measurements and back to labour depth. From an equity perspective, it adds even more pressure on high participation-sensitive groups such as consumer discretionary and housing. Underappreciated names in education technology, healthcare support services, or remote infrastructure, on the other hand, could benefit from this shift in paradigm for work. Next month’s JOLTS print, as well as wage growth release, and subsequent releases thereafter, will be the acid test as to whether this participation drop-off is a one-off reversal or a shift.
Labor Raises Alarms As Deceptive Optimism Reigns
The relationship between Labor Differential and unemployment is strengthening, with May 2025 figures showing an uptick in unemployment rates to 4.2% as consumers’ confidence continues to erode. While Conference Board Consumer Confidence Index rose 12.3 points to 98.0, the rise appears as a fleeting attitude adjustment—most probably a result of the temporary May 12 Chinese tariffs reprieve—more than an indication of underlying labour market health. Importantly, Labor Differential, a gauge of consumers saying jobs are “plentiful” rather than “hard to get” on a net basis, is also weakening, a leading indicator that has historically foreshadowed more broad employment fragility.
At Zaye Capital Markets, this divergence is a screaming red flag. A May employment addition of 139,000 can’t mask that fewer consumers believe the job market is healthy, on a trend of hesitant hiring and hidden vulnerabilities. The Labor Differential has reliably preceded official unemployment indicators, so this between increasing confidence indicators and flat job sentiment could be fleeting. The Expectations Index remained at 72.8 for Conference Board—far below recession levels at 80—indicating pervasive consumer pessimism beneath surface-level optimism. For analysts, there is a stark message here: consumer equities, particularly consumer discretionary groups, are faced with headwinds if this divergence in confidence shuts down through worsening expectations rather than more supportive labour news. Alternatively, cheaper consumer staples and defence service providers—where demand is not as cyclic—are more likely to offer more positive risk-adjusted positioning. As the first half of 2025 gives way to the second, it will be crucial to closely track wage patterns, as well as the Labor Differential, in order to see whether recent positivity is fleeting or a precursor to sentiment de-coupling with economic fundamentals.
Revolving Credit Surges, but Cracks are Already Forming Under the Surface
April 2025 saw U.S. revolving consumer debt—basically debt on credit cards—rising at a high 7% annual pace, reflecting strong borrowing demand in a weak recovery environment. The sharp jump propelled total consumer growth to $17.87 billion, contributing to evidence of greater reliance on high-cost borrowing. While this could be proof of current consumer resilience, it also carries a danger of overheating, particularly with this borrowing spike coupled with high consumer prices as well as subdued real pay growth.
In Zaye Capital Markets’ perception, such a divergence between borrowing behavior and inflation expectations is a potential misalignment in consumer planning. Consumer inflation expectations, having softened to 3.2% in May at one year, could be underestimating future cost pressures or overestimating future income security. Overconfidence, coupled with elevated interest rates held at 20–22% on average, is a warning on the sustainability of the cycle in credit consumption. Historical linkages, as a 2023 Journal of Economic Perspectives article illustrates, show rapid growth in credit before delinquency spikes as well as overall financial distress.
From a valuation standpoint, consumer credit-exposed discretionary retailers and unsecured lenders feel pressure from this trend. However, analysts do have opportunities in undervalued names with a preference for controlling credit risks or defensive equity names in consumer staples as well as off-price discount retailers who can benefit from a hunt for value. A monitoring of consumer levels of delinquency, levels of consumer utilization, and July sales through retailers will be important in ascertaining whether this trend in borrowing is a short-term buffer or an indicator of a narrowing of family liquidity levels.
Office Vacancy Rate Rises to 20.4%, Exposing Structural Weakness
Through Q1 2025, the U.S. national office vacancy rate sped up to 20.4%, a more than ten-year high. A dramatic jump implies a structural shift in the commercial real estate environment, well above pre-pandemic levels as well as early 2010s recovery. The stable high level points towards challenges associated with adoption of hybrid workspace, corporate space contraction, as well as geographic imbalances between demand from occupants and office space availability—development, in a sense, rewriting post-pandemic workplace trends.
At Zaye Capital Markets, we see such high vacancy as a longer-term secular theme rather than an interim imbalance. Overhangs from under-occupied office space, particularly in Tier 2 markets and older Class B venues, continue to pressure property values as well as investor sentiment within the commercial REIT market. Meanwhile, high borrowing costs alongside tightened credit terms further dissuade redevelopment or adaptive reuse, adding fuel to imbalance between demand and supply within core metro markets. These phenomena are beginning to manifest in slowing development initiation as well as expanding sublease inventories, harbingers of a broader adjustment within the asset class.
Analysts need to watch closely those banks with exposure to CRE, office REITs, and large commercial books for insurers, where stress remains yet to be fully reflected. Underpriced data center REITs as well as flex-office infrastructure providers offer more compelling exposure since they navigate the shift toward digital-first, decentralized working. Tough coming metrics—Q2 take-up levels, as well as cap rate spreads—are what will decide whether a trough or not the sector is reaching in its COVID aftermath.
The Office Vacancy Ratio Reaches 20.4 Percent, Exposing Structural Weakness
Through Q1 2025, the U.S. national office vacancy rate hit a 20.4% level, one of its highest levels ever. Its sharp rise marks a structural shift in commercial real estate, well higher than pre-pandemic norms and levels in the early part of the 2010s recovery. Its sustained elevation highlights the complexity of adopting hybrid work, corporate space trimming, and mismatches between levels of regional office supply and levels of demand from occupants—drivers that have redefined workplace norms post-pandemic.
At Zaye Capital Markets, we see this high vacancy as a secular issue in the longer run rather than a short-term dislocation. Overhang from excess, under-leased space, particularly in Tier 2 locations and older Class B buildings, still depresses property values and investor sentiment within the commercial REIT space. Meanwhile, more punitive cost of money and stricter credit terms continue to suppress redevelopment or adaptive reuse, worsening the supply imbalance in core metro markets. Those forces are beginning to manifest in slowing building momentum and buildings full of more subleasing, a sign of a widespread recalibration of the asset class.
Analysts should closely watch over CRE-exposed banks, office REITs, as well as insurance companies with significant commercial portfolios, where stress remains underpriced. Meanwhile, underpriced data center REITs as well as flex-office infrastructure names present more compelling exposure as digital-first, decentralized work patterns continue to shift from traditional workspace. Critical data in the short term—Q2 leasing demand take levels, as well as cap-rate differentials—will be what determines whether or not this sector is nearing a nadir or still establishing its post-pandemic balance.
Stockpile Accumulation, Fear of Deflation Hinder Recovery Expectations
The latest tranche of US economic data for Jun 9–13 presents a subdued, multidimensional macroeconomic landscape. Final wholesale inventories rose more than expected in Apr by 0.9%, well ahead of its previous zero reading. The steep inventory build has a potential to continue pressurizing Q2 GDP unless final demand can take it in, reminiscent of overstocking problems in past cycles. Rising inventories generally reflect cautious corporate expectations or demand misestimates, with a potential for even poorer business investment momentum lurking in the pipeline.
What we are seeing at Zaye Capital Markets is producer price pressures having suddenly reversed. May Core PPI plummeted on a year-over-year basis to -2.9%, racking up deflation pressure at production levels. While Core CPI was maintained at 0.2% month-over-month, slowing pricing on the upstream side could pinch corporate margins if final goods pricing is contained. That kind of deflation pressure is in line with previous Fed studies correlating post-pandemic compression with normalization within the supply chain—a dynamic that could cap revenue growth even as input costs ease.
Adding concern is a labour market fraying at its edges. First-time jobless claims rose to 1.91 million, alongside a drop in consumer sentiment, with the University of Michigan index falling to 53.5. These indicators suggest households becoming more conservative, with a potential tempering of spending on the horizon. For equities investors, cheaper defence trades in healthcare and utilities are better-positioned, with cyclicals, particularly industrials and retailers, potentially experiencing earnings headwinds. Analysts should wait for the June retail sales print and PCE reading for further evidence on underlying economic trend.
Inflation Expectations Decline, Repricing Fed’s Next Move
Consumer inflation expectations have dropped drastically across all horizons, with the NY Fed’s May 2025 survey seeing one-year horizon drop down to 3.2% from 3.63% and longer-term expectations ease to 3.0% (3-year) and 2.61% (5-year). Repricing comes as tariffs uncertainty continues under President Trump, with consumers appearing to believe in an easing macro environment instead of increasing inflation. Contrary to conventional wisdom tariffs would directly contribute towards consumer price pressures, falling energy and automobile prices appear to be soothing short-term inflation dynamics.
At Zaye Capital Markets, we believe this is an inflection point. And with unexpectedly muted April CPI prints on falling gasoline and car rates, the Fed’s mandate on inflation is being under increasing pressure. Over it all, consumer sentiment is yielding subtle hints at a reversal as well: job loss expectations stand at -0.5% as debt delinquency expectations are at a January low. And all this is leading towards leveling off home finance conditions and enhanced confidence in a soft landing, opening room for accommodative monetary policy stance.
Such a shift has a potential to induce Federal Reserve to rethink its current “higher-for-longer” policy. As inflation expectations remain anchored or decline further, markets will come to price a dovish shift in late 2025. Underpriced assets like interest-rate-sensitive ones i.e. REITs, housebuilders, consumer lenders are on analysts’ watchlist, fresh this time. Global inflation moderation—captured between eurozone-APAC datasets—gives a push toward a more synchronized cycle easing. Outlines of June FOMC statement as well as dot plot revisions are expected for some indication on Fed’s new track.
UPCOMING ECONOMIC EVENTS
President Trump Speaks, Average Earnings Index – 3m/y, Claimant Count Change
As markets move into a datapoint-rich corridor, three events will be in the forefront—each of which has the ability to shift sentiment within currencies, equities, and bonds. From the jobs data from the UK through political news from the United States, the markets will seek evidence that supports or contradicts the consensus of intransigent inflation, anaemic expansion, and increasing policy uncertainty. Below is a closer examination of what those events are, and the ability of each outcome to shift the dynamics of market momentum in the days ahead.
President Trump Addresses
President Trump’s speech will be market direction-defining. With investor sentiment rattled by tariff uncertainty, labour market reforms, and conflicting inflation figures, any new policy pronouncements will be scrutinized for signals on trade, rates, and fiscal stimulus.
- A hardening of hawkish trade talk—particularly against the EU or China—will have us look for a sharp risk-off: equity markets will sell down, the U.S. dollar will harden on haven flows, and bond yields will rise as inflation risk gets repriced.
- A dovish message from Trump, on the other hand, with demands for rate cutting or de-escalation of trade tension, could ignite a risk asset rally, though. Sectors such as technology, semiconductor, and multinational industrials would stand most to benefit from any evidence of easing of policy economics or supply-chain relief.
3m/y Average Earnings Index (UK)
The Average Earnings Index gives immediate insight into wage inflation and consumer purchasing power—two of the most significant determinants of the Bank of England’s rate-setting process.
- In the event of stronger-than-expected wage growth, the markets will begin to price longer monetary tightness in order to stem demand-side inflation. This will bolster the British pound and pressure the FTSE 100, as tighter rates compress corporate margins and deflate equity multiples.
- In the event of weaker-than-forecast figures, it will add further evidence that labour market tightness is easing, which opens up the possibility of a dovish turn for the BoE. This would lower the pound sterling and boost UK equities, particularly rate-sensitive ones such as housing and consumer discretionary.
Change in Claimant Count
This is an up-to-the-minute measure of the health of the UK labour market that reflects the change in claims for joblessness.
- A lower-than-forecast claimant count would justify the perception that the labour market is continuing to be resilient despite broader global headwinds. Such a reading is capable of sustaining support for the pound, in addition to confirming faith in domestic consumption and servicing-led growth.
- Conversely, a high claimant count would justify worsening labour market pressure, especially together with slowing wage growth. This would fan rate cutting expectations and most probably lead to sterling weakness as well as drive up the price of UK gilts. Equity investors would therefore rotate into defensives such as utility, telecoms, and healthcare on the basis of worsening household balance sheets.
While these events unfold, Zaye Capital Markets will be particularly sensitive both to the prints of the data itself and to market responses to their implications in an environment where data-sensitive sentiment is more dominant. Political messaging, pressure from earnings, and the health of the labor market will be set to be front and center in influencing near term asset allocation.
Stock Market Performance
Markets recover from lows, with top-level weakness continuing
U.S. equities recovered from first-half lows during May, but broader drawdowns remain large, and median member performance continues to reflect uneven recovery. Despite the recent moves, the market environment is deeply split between cap tiers and styles.
The following is the comprehensive analysis on key indexes:
S&P 500: Resilience is enhanced but breadth is weak
S&P 500: YTD +2% MMR +20% from low of 4/8/25 YTD High -19% Ave. member -23%
The S&P 500 is +2% for the year thus far after rising +20% from its low of April 8. A -19% drop from the high of the year and -23% median member performance, however, shows recovery is less well-supported. Narrow leadership from only a hand full of large caps is covering over the weakness across the index.
NASDAQ: Technology Sector Recovers, But Underlying Pressure Persists
NASDAQ: +1% YTD | +28% over 4/8/25 low | -24% from YTD peak | Avg. member: -44
The NASDAQ is up +28% from its April low, which has resulted in its YTD return being in the black, standing at +1%. It is still -24% off highs, though, and its average component is -44%, with unabated weakness continuing in risk-sensitive, high-growth areas.
Russell 2000: Small-Cap Underperformance Pers
Russell 2000: -4% YTD | +21% off 4/8/25 low | -24% from YTD high | Avg. member: -37 The small-caps remain well in the red, with the Russell 2000 down -4% YTD after rebounding +21% off recent bottoms. A -24% peak-to-trough decline and -37% median member losses testify to ongoing investor hesitancy in the face of smaller, lower-liquidity names—often the earliest names affected when uncertainty ripples through the market.
Dow Jones: Resistant, Yet Not Proof against Pullbacks
Dow Jones: +1% YTD | +14% from 4/8/25 low | -16% from YTD high | Avg. member: -23% The Dow Jones has achieved a modest +1% year-to-date gain, assisted by the +14% recovery from the April 8 low point. Despite having the lowest drawdown of major indices of -16%, the -23% average member decline suggests the bigger challenge even for blue-chips in maintaining upside momentum.
The Strongest Sector In All These Indices
Industrials Sector Powers Market Higher as 2025 Surpasses Overall Market
Sector performance through June 6, 2025, within the S&P 500 is clear. Industrials lead the way. The sector’s strength is unmistakable with a compelling +9.7% return through June 6 and a solid +1.4% month-to-date return for Industrials, all other industries having been easily surpassed for cumulative and shorter-term results. The sector’s resilience is evidence of its strength against macro headwinds based upon strong demand for infrastructure, defense, and manufacturing equipment.
Close behind, Communication Services and Utilities each had a +6.5% YTD performance. Still, Utilities lost -1.0% month-to-date, suggesting recent profit taking or rotation, while Communication Services added another +3.2% over the same period—showing more consistent upside momentum. Financials and Consumer Staples each had solid +5.8% YTD, although the latter lost -1.6% month-to-date, suggesting sector fatigue.
By contrast, Consumer Discretionary is the worst performer of the year through -6.8%, although having dipped modestly -0.6% during June. For the time being, the leadership baton is well and truly in the hands of Industrials—a reflection of investor demand for economically sensitive groups leveraged upon capital expenditure cycle and supply chain normalization.
EARNINGS
Yesterday’s Earnings (June 9, 2025)
- Casey’s General Stores, Inc.
Casey’s reported solid Q4 fiscal 2025 results, including net income of $98.3 million and $2.63 of earnings per share—$0.60 better than consensus estimates of $2.03. Fourth quarter revenue of $3.99 billion came in modestly better than expected. The company also declared a 14% dividend hike to $0.57/share. In addition, Casey’s is forecasting 10-12% EBITDA growth in FY 2026 driven by accelerating store count (up 270 stores) and growing its rewards club to over 9 million members
- Vinfast Auto Ltd
VinFast reported Q1 2025 net loss of $712.4 million, lower from last quarter and larger than expected. Yet, revenue increased 150% on a yearly basis to $656.5 million as deliveries grew near identical percentage terms – almost 300% – to 36,330 units. Gross margin improved but remained far from narrow -35.2%. Cost-reduction theme continued from management with dealership sales shift and resource shift into the Asia growth markets.
- Renew Energy Global PLC
Renew Energy reported Q4 FY25 results today (basically no new figures up until today). A preview reveals revenue increased ~26.8% YoY to ~$275 million and EPS of ~$0.07 per share.
- Motorcar Parts of America, Inc.
Motorcar Parts reported Q4 FY25 gross profit of $38.5 million, or +10.6% y/y, with margin of 19.9% (up from last year’s 18.4%). The company reported EPS of –$0.04, better than expected, and revenue of $193.1 million, also better than expected. The management reiterated FY 2026 revenue guidance of $780–800 million.
June 10, 2025: Earnings Today
- GameStop Corporation
Due to report after close. Analysts anticipate $0.08 of earnings per share on revenue of around $750–754 million. The market will be seeking news of its foray into Bitcoin positions (worth $500 million) and evolving plan for shoring up sagging retail sales.
- The J.M. Smucker Company
Reporting before opening bell. Expecting $2.25 of EPS on ~$2.19 billion of revenue, down from last year (~15% decline of EPS). One will need to focus on margin direction, the price power of core consumer products, and management insight into inflation and consumer spend. Variance from expectations could reset equilibrium prices substantially.
- Core & Main, Inc.
Reporting before the bell. Estimated $0.52-0.54 EPS, with modest YoY growth. With its exposure to spend on infrastructure and spend on utility, focus will be on direction of margin, presence of healthy order-book, and supply-chain dynamics.
- GitLab Inc.
Reporting after market close. Expecting to report modest profit (non-GAAP EPS $0.14–0.15) on revenue of ~$212–213 million, or ~26% annual growth. Most key metrics are subscription growth, trend of free cash flow, and guidance in context of competitive SaaS/DevOps marketplace.
- Academy Sports and Outdoors, Inc.,
Reporting before market open. Analysts are expecting EPS of $0.84, a decline of ~17.6% YoY; P/E ratio of ~7.7. Same-store sales, inventory, margin preservation, and consumer spending in the leisure/outdoor segment are important items investors will want to watch.
- United Natural Foods, Inc. (UNFI)
Q3 FY25 earnings expected pre-market hours. Consensus is $0.24, or about a ~140% year-over-year growth. Focus is on the operational consequence of the cyberattack which suspended deliveries, margin guidance, and its ability to restore logistics and consumer trust.
Stock Market
Markets are grappling with new monetary and geopolitical tides in the face of an economically information-packed week. At the top of the list is inflation expectations, potential Federal Reserve policy turns, and new attention being placed on global flows of trade. With stabilizing economic statistics and technologically influenced sentiment oscillating back and forth, investors are balancing short-term risk against mid-term policy routes.
Stock Prices
Economic & Geopolitical Drivers
Markets are watchful of opposing signals from inflation and trade flows today. In focus is new labor and wage statistics that could influence the Fed policy perspective. Geopolitically, President Trump’s recent tariff moratorium outside of China is being absorbed, with possibilities for easing of trade pressure—though with uncertainty in light of unresolved U.S.-China policy.
The “Magnificent Seven” & S&P Landscape
Broader markets were rattled recently with recent public row with Tesla—tech giant Tesla dropped 14% after Twitter feud with President Trump, bringing down broad indices including the S&P 500 and the Nasdaq
Though the broader “Magnificent Seven” remain atop the index driver benchmark, over-concentration risk is hanging over it. Even with S&P 500 weighting now above 30%, the recent trend of accelerating earnings revision is showing upside momentum can carry it through to new highs of approximately 6,500.
June 10, 2025: Key Index Trading Levels
- Nasdaq Composite: At approximately 16,900, down roughly 0.5% for the day with the volatility of mega-cap technology stocks
- S&P 500: Around 6,150-6,200, mildly bullish, trading just under the resistance of 6,100-6
- Russell 2000: About 1,950, flat, lagging other indexes YTD
- Dow Jones Industrial Average: Finished close to 39,800, slightly up, aided by advances in industrial and defense shares
Looking ahead, the correlation of earnings upgrades, macroeconomic statistics, and technology sector sentiment will be most significant. Key levels to focus on are 6,200–6,300 on the S&P 500. Successive breakdowns below these would confirm bullish momentum, and further weakness in the megacaps would extend market divergence.
Gold Price
Gold is trading at levels of approximately $3,307/oz, having recoiled from yesterday’s red hot intraday top of $3,326.95 by approximately $19. The fall comes despite the recent salvos of the President—calling the economy “a house of cards” and advocating protectionist “America First” trade policy—having triggered safe-haven buying. Expectation of tariff relief from yesterday’s optimism on the possibility of soon-to-be-held U.S.-China trade talks has cooled gold’s magnetism, though. Short-term bearishness is backed technically, with gold breaking through key support of approximately $3,293 and producing oversold indications from oscillators.
We perceive this pullback as more of a market balancing act and less of something more fundamental in nature. The heightened geopolitics—headline-seeking Trump statements and any escalation with Netanyahu—continue to drive price volatility. Soft labour data and declining inflation expectations both lower the need for the Fed to raise rates, and thus support gold over the medium term as well. Shorter-term drivers are this morning’s Average Earnings Index and UK Claimant Count, which could drive real yields and dollar strength. Breaking above $3,328 is bullish for more upside, while breaking below $3,293-3,300 will yield more downside consolidation. The next direction in gold is in the balance of hard and political news—watch this space.
OIL PRICES
Oil continues trading near multi-week highs, with Brent at $67.16/barrel and WTI at $65.42—levels last witnessed in early April. Overnight gains accelerated after the U.S. dollar weakened and U.S.–China talks in London improved expectations, while enhancing global recovery prospects and stimulating crude demand. Despite such positives, prices continue to contend with modest increases in OPEC+ production, Chinese export and refinery maintenance slowing down, and ongoing geopolitical risks (Iran’s return to global markets being the notable one).
President Trump’s commentary on economic softness—his “house of cards” characterization of the economy—and his increasing pressure for “America First” policy require that markets ponder whether his words amount to new tariff escalation that will slow global GDP and dampen crude demand. Aside from that, his claims of U.S.-China talks “going well” gave crude another bullish boost. Yesterday’s news—higher initial claims for benefits and lackluster wage growth—bolsters the prudent consumerism and weak demand theme. In that context, today’s Claimant Count and Average Earnings Index prints could shift the sentiment: stronger wage prints would tighten monetary expectations, and thereby put pressure on crude through a stronger dollar, while softer prints would benefit crude as dovish central bank signals gain ground in markets.
BITCOIN PRICES
rebounded above the $110K mark after last week’s leveraged shorts were partly unwound with a muted “peaceful rally.” The rally continues to be driven by institutional buying, with spot BTC ETF flows coming in record volume—even outpacing the gold ETFs in less than two years—while MicroStrategy bought another 1,045 BTC for approximately $110 million last week. The crypto space is being supported by corporate balance-sheet deployments, rising retail/on-chain activity, and rising perception of BTC as “digital gold” based on BlackRock’s CEO stating that it is now “a core asset for global flows”.
Shifting gears to macro and politics, President Trump’s recent utterances—calling the Fed-created economy “a house of cards” and stating central banks “can’t be trusted”—have reignited Bitcoin’s story as monetary excess and political uncertainty hedge. Yesterday’s news—showing sharp jobless claims and anaemic wage growth—bolsters this story by solidifying expectations of dovish rate policy, lowering opportunity cost of holding non-yielding instruments like BTC. In the coming days, today’s Average Earnings Index and Claimant Count news is key; weaker prints will further benefit Bitcoin by solidifying expectations of delayed hikes, while upside surprise will put the rally on hold temporarily as real yields return to equilibrium.
ETH PRICES
Ethereum is sitting at approximately $2,538 after firmly reclaiming $2,500-$2,460 support lows. Institutional demand is still the driver of momentum—last week’s weekly ETF flows were $295 million, equivalent to 15 days of continuous net net flow, with total assets under management of over $14.1 billion now. This institutionally supported fund influx is countered by whale action: large on-chain accumulation is taking place, with $364 million of ETH being transferred off of exchanges into private wallets, and another whale purchasing around $320 million through a Consensys-linked account and staking approximately 41,000 ETH. This is evidence both of funds and high-net-worth actors are preparing for a breakout—potentially into resistance levels of $2,700-$3,000.
Heavy exchange ETH transfers have accelerated—last week, one whale transferred about 4,732 ETH ($12 million), and another 9,846 ETH ($25 million) has been offloaded since May last month. On-chain flows of this sort typically indicate profit-taking or weakening sentiment. Despite this, however, institutionally backed accumulation has maintained, resulting in offsetting flows. Yesterday’s more extensive economic prints—compared with weakening job expansion and perplexing labor indications—have aided crypto sentiment in reaffirming hopes for dovish Fed policy. This lowers real rates, rendering ETH’s yield-short asset class more appealing. With today’s prints yet to be released, should wage and claimant figures disappoint, crypto could rally again; otherwise, solid labor prints could dampen near-term bullish pressure.
