Markets Surge on Tech Trade, "Not Critical" Tariffs

Thursday, June 26, 2025

We started this trading week with some questions about the ability of the stock market to overcome some perceived major hurdles, a burgeoning war in the Middle East among them. Also, we’ve gotten a large dollop of economic news thus far for the week, including this morning’s Weekly Jobless Claims and Q1 GDP.

And yet, nothing seems to faze market participants at this point and time. All markets except the small-cap Russell 2000 are now up for the year, with the S&P 500 a hair away from all-time highs back in February. The AI trade is back on to bolster tech stocks: NVIDIA NVDA and Palantir PLTR, for instance, are at new record highs. 

And the White House press secretary earlier today said the July 9th deadline on reciprocal tariffs is “not critical,” meaning, perhaps, in the minds of stock market investors, “non-existent.” Basically, to whatever extent people were checking their calendars for trade-busting tariffs on the horizon, they’re not doing so now — and it’s a cause for celebration.

Finally, worsening Continuing Jobless Claims, reported on this morning in this space, indicate a labor market that is noticeably weakening. While this is not a good sign economically overall, it may provide a way forward for the Fed to resume cutting interest rates, which it hasn’t done all year. Lowering rates is key to unlocking plenty of other aspects of the economy that haven’t performed quite so well as NVIDIA and Palantir, such as the housing market.
 

Nike Beats Fiscal Q4 Estimates

Reporting fiscal Q4 earnings after today’s close is Nike NKE, and expectations were for a fairly dismal quarter. Fortunately, Nike beat on its bottom line for now the eighth-straight quarter with earnings of 14 cent per share, 2 cents better than anticipated. Revenues in the quarter came in at $11.1 billion. That said, these results pale in comparison to the year-ago figures of $1.01 per share on $12.61 billion in sales.

Full-year revenues of $46.3 billion outpaced the Zacks consensus, but were still down -10% year over year. North America revenues were down -11% year over year, and that same -11% applied to all regions around the world combined. After gaining +2.8% on this strong day of regular trading, however, Nike shares are down -1.6% on this earnings news.
 

What to Expect from the Stock Market Tomorrow

At some point, investors will again begin evaluating these market levels after such a convincing bull run. We’re not sure if tomorrow will be the day, but Personal Consumption Expenditures (PCE) data Friday morning may be a guide toward what to expect. Year over year projections are for a +2.3% read on PCE growth, +2.6% on core. These are near the Fed’s inflation target of +2.0%, so any surprise closer to that mark may also be met with market exuberance.

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