Mid-Morning Look: June 02, 2026

Mid-Morning Look

Tuesday, June 02, 2026

U.S. stocks opened lower but quickly rebounded with another jump in semiconductors (SOX) hitting another record high around 13,500 and helping lift the Nasdaq Comp back above 27,000, trying for its 9^th consecutive daily advance along with the S&P 500 which is holding around 7,600. After positive earnings/massive upbeat guide from HPE and both STM, MCHP raising their Data Center outlook guidance overnight, the upbeat comments and momentum in tech/AI/chips keep the bullish flow coming into tech as the XLK leads again today after surging 2% Monday and +19% in May (+37% YTD). The positive tech news daily continues to offset stubbornly high oil prices and Treasury yields with rising expectations of a potential Fed rate hike this year. Early market leaders again Tech XLK +0.9%, Energy XLE +0.5% and Utilities +0.5% while Communications XLC -1.3% Healthcare -0.95% and Consumer Discretionary -0.9%.

More headline noise surrounding US-Iran negotiations after Trump said talks continuing at a rapid pace. Crude surged on earlier reports Iran suspended talks and threatened to disrupt shipping in Red Sea in response to Israel’s ground offensive in Lebanon. Lebanon later announced partial ceasefire between Israel and Hezbollah following Trump’s phone to PM Netanyahu. Mixed tariff developments with White House dialing back some of its steel and aluminum tariffs, including those impacting ag equipment, while also targeting Brazil with a 25% tariff over unfair trade practices.

Federal Reserve Bank of Cleveland President Beth Hammack said that the U.S. central bank may need to act “soon” to combat inflation pressures that are already too high and are on a worrisome trend. “If we wait for definitive evidence that high inflation has become embedded in the economy, it may require larger policy adjustments, at greater cost.” For now, “it’s reasonable to keep rates steady given the uncertainties around the economic outlook. But if recent trends continue, it may soon be appropriate to act,” the official said.

Crypto assets tumbling with Bitcoin dropping below $69,000, accelerating selling pressure the last few weeks down over 3% and Ethereum -2.5% back under $2,000, now down nearly -$5,000 since Strategy (MSTR), disclosed its first sale in over 3 years yesterday.

• Power/Industrials sector: GNRC announced it has signed a global supply agreement with a hyperscale data center operator to supply backup power generators for the company’s data center infrastructure. Auto suppliers getting a boost after Wells Fargo positive comments, raising tgt on BWA, VC and ST discussing the Auto Supply Chain, the firm sees the five best growth areas as Active Safety, Cockpit, Controllers, E-Powertrain, and Lighting. Firm said BWA remains best positioned given strong share in e-powertrain, PHEV tailwinds, & upside from Ai/data Centers. E-powertrain likely rebounds in 2027 W/ global NEV volumes +20% Y/y & competition has eased W/ suppliers like Nidec exiting.
• Retail: DG posted mixed Q1 results as EPS/sales $2.00/$10.79B compared to $1.89/$10.81B est. and said Q2 comp sales rose +2%; raises FY26 EPS outlook to $7.20-$7.45 from $7.10-$7.35, maintains FY26 sales growth forecast of 3.7%-4.2% and comp sales view 2.2%-2.7%. Specialty Retail: SIG beat earnings expectations and raised its full-year outlook as Q1 EPS $1.56 vs $1.38 est. and in-line revenue $1.55B with average unit retail +5%; narrows FY27 adj EPS view to $9.20-$11.20 from $8.80-$10.74 and Narrows FY27 revenue view to $6.7B-$6.9B from $6.6B-$6.9B (est. $6.84B).
• Brokers & Exchanges: CBOE shares fell for a 6th straight day, tumbling and down 9 of last 10 days off ATH $370.70 just a few weeks ago 5/19; SCHW launches 24/7 Cryptocurrency futures trading on Thinkorswim platforms; CME reports May ADV of 33.2M contracts, up 15% y/y; reported its highest May average daily volume on record at 33.2M contracts, an increase of 15% y/y

• HPE +28%; shares surged after Q2 results crushed estimates as sales were up 40% y/y to $10.68B vs. est. $9.77B on big EPS beat driven by Networking segment up 148% and Cloud & Ai segment up 23%. Notably, Cloud & Ai strength of 23% was driven by x86 server revenues up 33% and traditional server orders were up >100%; FY26 EPS/rev guidance well above street, EPS of ~$3.30 (vs. Street at 2.42).
• MCHP +8%; after the company provided its first formal exclusive data center revenue breakout and announced selective pricing increases; says to implement Selective price increases across broad product portfolio; price increase will have no impact on guidance or results ending June 30, 2026; Data center solutions business unit generated $302.7M revenue in 2025; expects 65% growth to $500M in 2026.
• MRVL +25%; shares surge over 27% after NVDA CEO Huang called the chipmaker the next “trillion-dollar company”. NVDA CEO Jensen Huang made the remark at the Computex conference in Taipei; earlier this yr, NVDA invested $2B in MRVL for its custom AI chips used in data centers.
• STM +13%; raised its data-center revenue targets, saying demand for Ai infrastructure continues to boom; said it now expects data-center revenue to come in at about $1B this year, against its prior forecast of above $500M; Data-center revenue could double in 2027, assuming current trends continue.
• VSXY +42%; shares jumped on results as Q1 sales $1.56B topped consensus $1.52B and providing upbeat guidance as raised annual net sales to be in the range of $7.03B-$7.13B vs previous forecast of $6.85B-$6.95B and annual adj operating income to $550M-$580M from $430M-$460M.

• CBOE -8%; shares fell for a 6th straight day, tumbling and down 9 of last 10 days off ATH $370.70 just a few weeks ago 5/19.
• CELC -23%; after posted detailed data from a Phase 3 trial testing its lead candidate, gedatolisib, in breast cancer; said the Phase 3 VIKTORIA-1 trial indicated that experimental therapy was associated with a Grade 5 treatment-related adverse event, which the company attributed to palbociclib.
• CRDO -6%; beat/raise, as near-term revenue growth continues to be driven by AEC proliferation and customer diversification; raised FY27E expectations to 80% y/y (75% prior) supported by $600M and FY27E optical revenue; stock saw pressure after 1%/ 2% beat/raise failed to meet prior double-digit %.
• FULC -52%; announced it is discontinuing the development of pociredir for the treatment of sickle cell disease after the FDA highlighted concerns regarding the potential secondary hematologic malignancies; Fulcrum has launched a review of the strategic alternatives while management moves to reduce operating expenses in order to preserve capital.
• GOOGL -2%; announced it has raised $80 billion to build AI infrastructure. Also has reached an agreement to sell $10B of stock to Berkshire Hathaway (BRK) in a private placement, comprised of $5B in Class A Common Stock at a price of $351.81 per share and $5B in Class C Capital Stock
• INTU -8%; was downgraded from Neutral to Sell at Goldman Sachs with $276 tgt saying their primary concern is that Intuit is entering a period of heightened competition in tax. Goldman thinks it may be challenging for Intuit to achieve its long term financial targets.
• MSTR -6%; as crypto assets pull back with Bitcoin dropping below $69,000, accelerating selling pressure the last few weeks down over 3% and Ethereum -2.5% back under $2,000, now down nearly -$5,000 since Strategy (MSTR), disclosed its first sale in over 3 years yesterday.
• NU -7%; downgraded from Neutral to Underperform at Bank America and cut tgt to $10 from $16 after the company announced that CFO Guilherme Lago will step down and transition to a Special Advisor role, effective July 13, with Rob Livingston appointed as the new CFO.
• PRAX -10%; after saying its experimental epilepsy drug did not meet the main goal of reducing monthly seizure frequency in a mid-to-late-stage study; said it will pause enrollment in another ongoing study to reassess the vormatrigine program and determine potential modifications; treatment met a secondary measure where more patients saw at least a 50% reduction in seizures.
• SHAK -10%; shares fell after cutting its guidance for Q2 (now sees comps +2.5-3% vs. prior +3-5%) and the full year (now sees EBITDA $225-235MM vs. the prior $230-245MM), just a few weeks after the stock tumbled on back of underwhelming Q1 results (shares sank ~28% on 5/7 after earnings).