OPENING CALL
Tech stocks looked poised to rebound Wednesday ahead of the Federal Reserve's first interest-rate decision under new chairman Kevin Warsh.
With investors all-but-certain the central bank will keep rates unchanged, focus will be on Warsh's remarks
for a sense of where borrowing costs are headed.
"Any stock market volatility caused by Warsh's commentary Wednesday is a buying opportunity in our view since the market fundamentals remain in place," Main Street Research said.
Brent crude futures were hovering near $79 a barrel, their lowest level since the first few days of the Iran war.
More details were emerging about the U.S.-Iran interim deal, giving markets a boost.
The Wall Street Journal reported that the U.S. would allow Iran to immediately begin selling oil and fuel , citing people familiar with the agreement.
Swissquote said SpaceX's surging share price after its IPO last week is a signal that rising technology stocks could be in bubble territory .
"SpaceX is perhaps the biggest red flag that today's technology rally is reaching a point where valuations no longer make sense."
Stocks to Watch
BMW
cut its guidance on the back of heating competition in the Chinese market and the spillover effects of the Mideast war. Its shares fell sharply, also dragging shares in Mercedes-Benz, Volkswagen and Stellantis.
Intel, Broadcom and Micron Technology recovered some lost ground premarket after the PHLX Semiconductor index of chip stocks had its second-worst day of the year yesterday.
After three days of gains since its IPO, SpaceX
was up about 3% premarket.
Economic Insight
Commerzbank said Warsh was unlikely to position himself strongly against the Fed
in his first meeting as chairman by voting for a rate cut straight away.
Warsh is likely to lean toward the center by not arguing for rate cuts or ruling out rate rises either , according to Deutsche Bank.
Carmignac said investors were now almost evenly split between the prospect of further tightening and that of policy easing, " effectively pricing a steady Fed through year-end ."
Watch For:
FOMC Interest Rate Decision, U.S. Retail Sales for May; U.S. Pending Home Sales Index for May; EIA Weekly Petroleum Status Report
Today's Top Headlines/Must Reads:
- State Farm's AI Plan for Sales Agents Sparks Uproar. 'A Real Slap in the Face.'
- The Medicare Crisis for Insurers Is Over. The Easy Gains Are Too.
- The AI Boom's Hunt for Cash Hits a New Corner of the Bond Market
MARKET WRAPS
Forex:
The dollar traded steady.
Commerzbank said the decisive factor for the greenback from the Fed meeting was whether Warsh describes the energy price shock as temporary and leaves market expectations for future rate rises looking unjustified.
ING said the Fed decision could test the dollar's resilience to lower oil prices .
"If Warsh or the broader Federal Open Market Committee signal a stance that is clearly at odds with market pricing, the dollar would sell off sharply."
Sterling fell to its lowest in nearly two weeks against the euro after the flat U.K. inflation reading.
For the BOE, the data "reduces some of the urgency"
surrounding the potential need to raise interest rates, Capital dot com said.
Bonds:
The 10-year Treasury yield was a touch lower. Treasury yields had moved marginally higher
in Asian trade.
Energy:
Brent crude fell below $80 a barrel after reports that the deal between Washington and Tehran included waivers of sanctions on Iranian oil sales.
The U.S. will allow Iran to start selling oil and fuel
once the deal to end the conflict is signed on Friday, The Wall Street Journal reported.
Julius Baer said energy flows should normalize quickly
following the interim peace deal between the U.S. and Iran.
Metals:
Gold prices were largely unchanged early Wednesday.
Easing inflationary pressures would typically weigh on non-yielding assets like gold but the precious metal is supported by lingering geopolitical uncertainty and cautious investor sentiment , MUFG said.
DWS said gold prices had significant upside potential .
Copper
LME three-month copper was higher. Demand is likely to be supported by AI-driven data center expansion , BofA Securities said.
TODAY'S TOP HEADLINES
Elon Musk Is Unleashing SpaceX's New War Chest to Solve His AI Problem
Elon Musk has admitted SpaceX lags behind rivals like OpenAI, Anthropic and even Google and Chinese open-source models in the race to build out artificial intelligence.
He now has an $86 billion war chest to help change that. And the first target is getting enterprise customers who Musk hopes are willing to pay large sums for access to SpaceX's tools and computing power.
'China's Instagram' Readies Hong Kong IPO That Could See It Valued at Over $70 Billion
Chinese lifestyle and video-sharing platform Xiaohongshu is aiming for an initial public offering in Hong Kong as early as the end of this year, according to people familiar with the matter.
Major investors are seeking to value the Shanghai-based company at more than $70 billion, the people said. The company was valued at over $50 billion in recent private secondary trades, according to some of the people.
Intel takes a major step toward turning around a business that's bleeding cash
Intel's central processing units have Wall Street excited right now, but what really matters for the company's financial turnaround is whether it can secure manufacturing customers. And on Tuesday, the company took a step in the right direction.
The chip maker INTC said Tuesday that it has entered "risk production" for the 18A-P variant of its 18A node family. That means its chip-manufacturing process is mature enough for initial production to begin.
Recycling Is in Crisis. The Industry Is Putting Its Money on Automation.
PEMBROKE PINES, Fla.-On the edge of the Florida Everglades, trash giant Waste Management just opened a $90 million facility that can process 60 tons of recyclable material an hour from four South Florida counties.
The new facility opened during a pivotal moment for the recycling industry. Public trust in recycling is low. Most Americans like the idea of recycling-87% thought it was important in a poll last year-but confusion and perhaps a tinge of laziness means less than one-third of recyclable household material ever makes it into collection bins. Some 47 million tons of residential recyclable material is generated annually, with only 21% of that material being recycled, according to The Recycling Partnership, a nonprofit.
Stock Futures Rise Before Warsh's First Fed Meeting
Brent crude oil fell back below $80 a barrel and U.S. stock futures rose in early European trade as further detail on a memorandum of understanding between the U.S. and Iran lifted sentiment.
Under the deal, the U.S. will waive sanctions on Iranian oil sales, The Wall street Journal reported. The memorandum also includes lifting U.S. and Iranian blockades in the Strait of Hormuz.
Trump Picked Warsh to Cut Rates. His Committee Is Talking About Hikes.
Kevin Warsh walks into his first meeting as Federal Reserve chairman this week in an awkward spot. He argued last year for interest-rate cuts and was chosen to deliver them. But the conversation at the Fed has shifted the other way-toward raising rates, not cutting them.
When President Trump picked Warsh in January, the Fed looked headed for lower rates-and the cheaper mortgages and loans that come with them. Investors expected several cuts this year, on top of three in late 2025, thanks in part to a wobbly job market that left officials worried that high rates were doing more harm than good. Inflation, meanwhile, looked like it might resume a decline toward the Fed's 2% goal once the effects of tariffs faded.
Oil Supply Could Far Outstrip Demand Growth if Middle East Peace Deal Holds, IEA Says
The Gulf shock is set to drag oil consumption sharply lower before flows through Hormuz gradually normalize, setting the stage for a supply surge that could far outstrip demand growth if the U.S.-Iran peace deal holds, the International Energy Agency said.
The Paris-based energy watchdog, a group of Western nations and their allies, now expects global oil demand to fall by 1.1 million barrels a day this year-from its previous forecast of a 420,000-barrel-a-day decline-on the back of high prices and severe supply disruptions.
Iran Is Returning to Nuclear Talks No Longer Afraid of America
After more than three months of bombing and blockades, the U.S. and Iran are back to square one, preparing for what promises to be difficult negotiations over limits to Tehran's nuclear ambitions.
This time, the Iranians will come to the table armed with valuable knowledge: They can survive the worst the Americans can throw at them.
Trump-Backed Mike Collins to Face Jon Ossoff in Georgia for U.S. Senate Seat
Rep. Mike Collins won Georgia's GOP primary runoff Tuesday over former college football coach Derek Dooley, setting up a showdown with Democratic Sen. Jon Ossoff this fall in one of the country's key battleground races.
With 87% of the vote counted, Collins received 55.8%, with 44.2% for Dooley, according to the Associated Press. Collins's campaign got a boost from an 11th-hour endorsement from President Trump. Gov. Brian Kemp, a popular Republican, had endorsed Dooley.
Trump Invokes Cold War-Era Law to Boost Munitions Production
President Trump invoked a Cold War-era law in an effort to increase production of important munitions, according to a memo released Tuesday, a step that signals the U.S. is concerned about a potential shortfall in weapons after heavy usage in Iran.
The decision to turn to the Defense Production Act comes amid doubts that American weapons makers are able to meet increased demand. The act has been used in the past to increase production of products such as critical minerals, baby formula or vaccines.
Write to gareth.mcpherson@wsj.com
TODAY IN CANADA
Earnings:
Nothing major scheduled
Economic Indicators $(ET)$:
0830 New Housing Price Index for May
Stocks to Watch:
Andrew Peller 4Q Gross Margin 52.2%; FY EBITA CAD 72.1M; 4Q Net Income CAD 5.7M; FY Net Income CAD 27.1M; FY Revenue CAD 393M; FactSet Est. CAD 392.3M (2 Est.); 4Q Revenue CAD 79.5M; FactSet Est. CAD 79M (1 Est.); FY Gross Margin 45.1%
BTB Real Estate Investment Trust Names Luc Martin Chair; Chairman Jocelyn Proteau Retires
North Amer Construction Group Ltd. Announces Closing of Private Placement Offering of C$200 M Senior Unsecured Notes
Sun Life Announces C$750M Offering of Subordinated Unsecured Debentures
Expected Major Events for Wednesday
06:00/UK: May Producer Price Index
06:00/UK: May CPI
08:00/FRA: Jun IEA Oil Market Report
08:30/UK: Apr UK House Price Index
11:00/US: 06/12 MBA Weekly Mortgage Applications Survey
12:30/US: May Advance Monthly Sales for Retail & Food Services
12:30/CAN: May New Housing Price Index
14:00/US: ISM Semiannual Supply Chain Planning Forecast
14:00/US: Apr Manufacturing & Trade: Inventories & Sales
14:00/US: May Pending Home Sales Index
14:30/US: 06/12 EIA Weekly Petroleum Status Report
18:00/US: Federal Reserve economic projections
18:00/US: U.S. interest rate decision
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Expected Earnings for Wednesday
CarMax Inc $(KMX)$ is expected to report $0.91 for 1Q.
Jabil Inc $(JBL)$ is expected to report $2.57 for 3Q.
LiveOne Inc (LVO) is expected to report for 4Q.
Progressive Corp $(PGR)$ is expected to report.
Richtech Robotics Inc (RR) is expected to report $-0.06 for 2Q.
Smith & Wesson Brands Inc $(SWBI)$ is expected to report $0.23 for 4Q.
Strata Skin Sciences Inc (SSKN) is expected to report for 1Q.
VivoSim Labs Inc $(VIVS)$ is expected to report for 4Q.
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ANALYST RATINGS ACTIONS
CAMP4 Therapeutics Raised to Overweight From Neutral by JP Morgan
Centerspace Cut to Neutral From Buy by BTIG
Cognizant Cut to Hold From Buy by Berenberg
Dave & Buster's Cut to Hold From Buy by Benchmark
Domo Cut to Hold From Buy by TD Cowen
Dynatrace Raised to Buy From Neutral by UBS
Elicio Therapeutics Cut to Hold From Buy by Jones Trading
Extra Space Storage Raised to Neutral From Underperform by B of A Securities
Exxon Mobil Raised to Buy From Neutral by B of A Securities
Hudson Pacific Properties Cut to Underperform From Neutral by B of A Securities
Kilroy Realty Raised to Buy From Neutral by B of A Securities
Palantir Technologies Raised to Peer Perform From Underperform by Wolfe Research
Payoneer Global Cut to Neutral From Buy by Citigroup
RBB Bancorp Raised to Outperform From Market Perform by Hovde Group
Rocket Cos. Cut to Neutral From Buy by BTIG
Roku Cut to Hold From Buy by Loop Capital
Roku Cut to In-Line From Outperform by Evercore ISI Group
Roku Cut to Market Perform From Market Outperform by Citizens
Roku Cut to Neutral From Outperform by Wedbush
Roku Cut to Neutral From Overweight by JP Morgan
Roku Cut to Neutral From Overweight by Piper Sandler
Roku Cut to Neutral From Positive by Susquehanna
Roku Cut to Peer Perform From Outperform by Wolfe Research
Roku Cut to Sector Weight From Overweight by Keybanc
Tanger Cut to Underperform From Neutral by B of A Securities
W. P. Carey Raised to Neutral From Underperform by B of A Securities
This article is a text version of a Wall Street Journal newsletter published earlier today.
(END) Dow Jones Newswires
June 17, 2026 06:01 ET (10:01 GMT)
Copyright (c) 2026 Dow Jones & Company, Inc.
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