Stock Market Update

[BRIEFING.COM] Stocks are building on yesterday's rally with a mostly higher showing today, though some weakness across the market's largest names following the debut of SpaceX (SPCX 172.69, +37.69, +27.92%) has the S&P 500 (+0.5%), Nasdaq Composite (+0.4%), and DJIA (+0.7%) modestly below their session highs. Broader market strength remains solid as optimistic developments between the U.S. and Iran send oil prices lower again today.

Crude oil is currently down $2.99 (-3.4%) to $84.72 per barrel as reports from both sides indicate that a peace agreement could be reached sometime next week. Most recently, Pakistani Prime Minister Shehbaz Sharif posted on X, "we can confirm that a final, agreed upon text of the peace deal has been reached and Pakistan is now working closely with both sides to finalize the next steps. Peace has never been this close as it is now."

Nine S&P 500 sectors trade higher, with the materials sector (+1.8%) leading the advances, supported by strong leadership in fertilizer names such as Mosaic (MOS 22.77, +1.68, +7.97%) amid optimism around the Strait of Hormuz reopening.

Other cyclical sectors, including the financials (+1.1%) and energy (+1.0%) sectors also outperform, even with the lower price of oil.

Meanwhile, the top-weighted information technology sector (+0.2%) holds a more modest gain. Semiconductor names are extending yesterday's rally, with the PHLX Semiconductor Index up 1.9%. However, the sector's four largest components by market capitalization trade lower amid a choppy session for mega-cap stocks.

Amazon (AMZN 236.94, -4.57, -1.89%) is a notable "magnificent seven" laggard, which keeps the consumer discretionary sector (-0.7%) firmly lower.

Some of that weakness could stem from investors taking profits in order to fund positions in the newest mega-cap stock, SpaceX (SPCX 172.69, +37.69, +27.92%). The stock opened at $150 per share after pricing its IPO at $135 per share.

Despite the mixed action across mega-cap stocks, broader participation remains encouraging, with strength extending well beyond technology for a second consecutive session. The combination of falling oil prices and optimism surrounding a potential U.S.-Iran agreement continues to support cyclical areas of the market and keep the broader tone constructive.

Reviewing today's data:

• June University of Michigan Consumer Sentiment - Prelim 48.9 (Briefing.com consensus 46.2); Prior 44.8
  
  • The key takeaway from the report is that the improved readings revolved around the early-month easing in gasoline prices, which was a relief factor felt by consumers across age, education, and political party. Still, there were reported concerns about higher inflation remaining stubborn.