Markets party on while Risks pile up 11/06/2025

HOT stories for today

US market wrap:

• The market edged steadily closer to reclaiming its record highs, but without concrete updates on this week’s trade negotiations with China, the massive spending bill looming over the Senate, or a verdict on interest rates impacted by rising inflation, price gains remain modest. During regular trading on Tuesday, the S&P 500 advanced roughly 0.6%, marking its third consecutive day of gains.
• The broad-market index is now within 2% of its February peak. The Nasdaq Composite also rose 0.6%, while the 30-stock Dow Jones Industrial Average increased by 0.3%. Despite the stock market’s recent rebound, concerns over tariffs and escalating bond yields continue to cast a shadow. Meanwhile, U.S. and Chinese representatives reportedly reached an agreement on trade during a second day of discussions in London, according to an NBC transcript. Investors are also awaiting the release of May’s consumer inflation data.

Markets party on while Risks pile up

• U.S. equity markets remain notably optimistic, with all three major indexes advancing on Wednesday. This positive momentum comes despite persistent concerns over President Trump’s proposed “reciprocal” tariffs. As the 90-day tariff pause nears its end, the U.S. has only secured a finalized deal with the U.K. and a tentative framework with China—still provisional and maintaining high tariff levels.
• Meanwhile, companies seem to be bracing for a slowdown. Layoffs have been picking up, with Google and Paramount joining Microsoft, Citigroup, and Disney in announcing job cuts—moves that, ironically, often boost stock prices due to cost-saving implications. The bond market, often more conservative than equities, could restrain this optimism. If inflation data or Treasury auctions surprise markets, rising yields could increase borrowing costs and weigh on stocks. In essence, equity investors are betting on trade progress and tame inflation—but bond markets and business leaders may be less convinced.

Stock’s on the move:

• Taiwan Semiconductor (TSM) — U.S.-traded shares of the semiconductor giant climbed over 1% after reporting a 39.6% year-over-year revenue jump for May. Cumulative revenue from January through May rose 42.6% compared to the same stretch in the previous year.
• SolarEdge (SEDG), Sunrun (RUN) — Shares of solar energy companies rallied following a Wall Street Journal report that a coalition of major tech firms is lobbying Congress to maintain clean energy incentives as President Donald Trump’s spending proposal moves through the Senate.
• Tesla (TSLA) — The electric vehicle maker’s stock gained more than 3%, building on Monday’s 4%+ rise. Trump stated he wishes CEO Elon Musk “well” and doesn’t plan to revoke Starlink access at the White House, despite their public spat last week. Musk reacted to the clip on X with a heart emoji.
• McDonald’s (MCD) — Shares of the fast-food giant slid over 1% after Redburn Atlantic issued a rare double downgrade to “sell,” citing falling customer traffic, pricing pressures, and concerns over the impact of GLP-1 weight-loss drugs on long-term growth.

                                      Watchlist: RUN, SEDG, TSLA, AAPL, TSM, CHWY, GME, PLAY, ORCL




Today’s action

• Asia-Pacific markets advanced on Wednesday following news that U.S.-China trade talks had resulted in a preliminary agreement, according to officials from both sides. The deal now awaits formal approval from the two nations’ leaders. Mainland China’s CSI 300 rose 0.77%, while Hong Kong’s Hang Seng Index gained 0.9%. Japan’s Nikkei 225 also edged up by 0.45%.
• U.S. stock futures dipped slightly Tuesday night as investors awaited more clarity on the U.S.-China trade framework and looked ahead to the release of May’s consumer inflation data. Futures linked to the S&P 500 slipped 0.16%, while Nasdaq 100 futures declined 0.17%. Dow Jones Industrial Average futures dropped 55 points, or 0.14%. On the earnings front, traders are watching for quarterly results from Chewy (CHWY) and Oracle (ORCL) on Wednesday. Investors will also turn their attention to the May Consumer Price Index (CPI) report, set to be released in the morning by the Bureau of Labor Statistics, offering further insight into inflation and the broader U.S. economy.

Bitcoin

• Bitcoin futures open interest has surged to 696,450 BTC—equivalent to $76.69 billion at press time. The CME leads with 151,010 BTC in open positions (over $16.6 billion), representing a 21.68% market share—highlighting strong institutional participation. Traders are making bold moves, with far out-of-the-money call options dominating the landscape.
• The largest open bets are on the $140,000 call expiring Sept. 26 and the $120,000 call expiring June 27, signaling aggressive and confident speculation. Meanwhile, investors are also closely monitoring the outcome of U.S.-China trade negotiations, which could further influence market sentiment. Bitcoin (BTC) climbed to $110,150, inching closer to its May 22 high of $112,000 as investor nerves eased amid ongoing U.S.-China trade talks in the U.K.
  Watchlist: Bitcoin: 100 000-112 000, Ethereum:1500-2800, Solana: 80-183

Forex

• The Japanese Yen extends losses near a two-week low as optimism over U.S.-China trade talks weakens demand for safe-haven assets. The USD/JPY holds near 145.00, supported by a firmer dollar, though gains remain limited amid BoJ-Fed policy divergence.
• EUR/USD pulls back to around 1.1400 as the U.S. Dollar strengthens on easing tariff tensions. A U.S.-China trade framework and a court ruling supporting Trump’s tariffs bolster dollar demand, weighing on the euro.
  Watchlist: EUR/USD: 1.0700-1.1600, USD/JPY: 140-151

Basic Materials

• Gold (XAU/USD) regains momentum, rising above $3,340 in Asian trading as geopolitical tensions and ongoing trade uncertainties boost demand. A U.S. appeals court ruling to uphold Trump’s tariffs adds to the safe-haven appeal. However, modest USD strength may limit further gains ahead of key U.S. inflation data.
• WTI crude trades near $63.80 early Wednesday, supported by positive sentiment around U.S.-China trade talks and an unexpected decline in U.S. crude stockpiles, per API data. Markets now await the May CPI report and the EIA inventory release for further cues.
  Watchlist: GOLD 2600-3500, US Oil: 55.60-70.00
  
   

Key Economic Events Today:

EST time
08:30 am: USD Core CPI, CPI
10:30 am: USD Crude Oil Inventories
01:01 pm: USD 10-y Bond Auction
02:00 pm: Federal Budget Balance


Earnings

BMO (Before the US Market opens)
CHWY         Chewy Inc.
SAIL            Sailpoint Inc.
VSCO          Victorias Secret
AMC (After the US Market closes): ORCL, OXM
 

The TEFS Analyst team wishes you a successful day!