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This report is designed to help investors of all skill levels break down important stories/topics within the stock market. And best of all, we cut through all of the BS and give you exactly what you need to know in easy to digest, bite sized pieces of content.
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Market Talk
Despite Wednesday’s sell-off following the Fed decision and Warsh’s first press conference, the major indexes ended the week higher as the US/Iran MOU signing outweighed a potential rate hike later this year.
3 Stories Moving the Market
These are some of the biggest stories from the second half of the week that had an influence on market action.
US and Iran Sign War-Ending Deal, But Fighting Already Threatens It
The US and Iran signed a memorandum of understanding this week to formally end their war, with Trump signing for the US at Versailles and Iran's president signing remotely. The deal calls for an immediate stop to fighting on all fronts, including Lebanon, and a reopening of the Strait of Hormuz. New fighting in Lebanon briefly threatened the deal before a fresh ceasefire there took hold Friday morning.
🔑 Key Points
60-Day Window: The MOU starts a 60-day period for both sides to negotiate a final, lasting agreement.
Hormuz Reopens: Ship traffic through the strait jumped sharply Wednesday and Thursday after months of near closure.
Brief Re-Closure: Iran shut the strait again Friday morning, citing the Lebanon fighting as the reason.
Talks Postponed: Both the US and Iran delayed sending delegations to follow-up talks in Switzerland.
Lebanon Truce: Israel and Hezbollah agreed to a new ceasefire Friday, taking effect at 4pm local time.
👀 What You Need to Know
This deal was meant to end nearly four months of war and restore normal oil shipping through one of the world's most important waterways. It faced an early test Friday when fighting between Israel and Hezbollah delayed the next round of talks and led Iran to briefly close the strait again. A new Lebanon ceasefire that afternoon eased those concerns, though Israeli troops remain in southern Lebanon for now. Markets are watching whether this latest truce holds through the weekend.
🔐 Edge Takeaway: The market has welcomed the ceasefire and MOU as though the deal is final. But Friday’s skirmish and cancelled negotiations are a sign that this deal is still far from complete and while markets can erase risk premium in a single session, the real economy…upgrade to Edge+ to read the Full Edge Takeaway. Take advantage of our Summer Sale this weekend only.
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Fed Holds Rates Steady But Dot Plot Signals A Possible Hike
The Federal Reserve left interest rates unchanged this week at its June meeting, the first led by new Chairman Kevin Warsh. The vote was unanimous, but the Fed's updated projections showed officials now expect rates to end the year higher than they previously thought. Stocks fell sharply on the news before recovering much of the loss the next day.
🔑 Key Points
Rate held: The Fed kept its benchmark rate at 3.50% to 3.75% for a fourth straight meeting.
Dot plot shifts: Officials raised their year-end rate forecast to 3.8%, up from 3.4% in March.
Inflation forecast up: The Fed raised its 2026 inflation forecast to 3.6%, well above its 2% goal.
New task forces: Warsh announced five task forces to review Fed communications, data, and inflation policy.
Markets swing: Stocks dropped over 1% on Wednesday, then rebounded over 1% on Thursday.
👀 What You Need to Know
A rate hike is now back on the table, something almost nobody expected just a few months ago. A new Fed chair also brings new habits, shorter statements, less forward guidance, and more uncertainty about what comes next for policy. That uncertainty is what spooked markets on Wednesday before calmer trading returned the following day. The next Fed meeting, roughly six weeks away, will show whether this hawkish tone continues or fades.
🔐 Edge Takeaway: The June meeting may prove to be one of the most important Fed meetings in years because it signaled a fundamental change in how…upgrade to Edge+ to read the Full Edge Takeaway.
📚 Edge-ucation: Why Are Interest Rates So Important?
Interest rates influence nearly every corner of the economy, from mortgages and credit cards to business investment and stock valuations. When the Federal Reserve raises or lowers rates, it changes the cost of borrowing money, which can accelerate or slow economic activity.
Consumer spending: Higher rates increase borrowing costs for homes, cars, and credit cards, often reducing spending and slowing economic growth.
Business investment: Companies face higher financing costs for expansion projects, acquisitions, and new hiring, which can weigh on future growth.
Stock valuations: Higher interest rates increase the discount rate, making future earnings less valuable today and putting pressure on high-growth stocks.
Fixed income competition: Rising rates increase discount rates, lowering the present value investors assign to future earnings and cash flows.
Understanding interest rates helps investors explain why stocks can rally or fall even when company fundamentals remain unchanged. Sometimes the biggest driver of returns is not earnings growth but the price investors are willing to pay for those earnings.
Nvidia and SpaceX Join Wave of Companies Racing to Raise AI Cash
Shout out to Le Shrub for this image
Nvidia $NVDA ( ▲ 2.27% ) and SpaceX $SPCX ( ▲ 15.83% ) both moved to raise large amounts of money this month to support their AI plans. Nvidia sold $25 billion in bonds, while SpaceX, fresh off a record $75 billion IPO, is preparing a bond sale of its own worth at least $20 billion. They join Alphabet, Meta, and Oracle, who have also announced major fundraising plans in June.
🔑 Key Points
Nvidia Bonds: Nvidia sold $25B in bonds on June 15, its first such sale since 2021.
SpaceX Bonds: After raising $75B in its IPO, SpaceX is preparing a bond sale of at least $20B following its record IPO.
Alphabet Equity: Alphabet announced an $80B stock sale, including $10B from Berkshire Hathaway.
Meta Considering: Meta is weighing a large stock sale after Alphabet's raise drew strong demand.
Oracle Guidance: Oracle expects to raise $40B in debt and equity over its next fiscal year.
👀 What You Need to Know
Big tech companies are spending huge sums to build AI data centers and computing power. That spending is now outpacing what many companies can cover with cash on hand, pushing them toward bond and stock sales instead. SpaceX's bond plan stands out since it comes just days after the company's record IPO, showing how fast its AI ambitions are growing. Investors have shown strong demand for these offerings so far, but the size of these raises keeps growing.
🔐 Edge Takeaway: Back in September I argued that circular financing was one of the clearest signs of a late cycle but that the market likely had another…upgrade to Edge+ to read the Full Edge Takeaway.
In Other News
In this section, we'll be curating a selection of news headlines we think you'll find interesting. If a topic catches your eye, click the provided links to read more about it.
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Edge+ Posts of the Week
We continue to push out more and more content every week to give investors that edge. Here are the posts Investor’s Edge+ subscribers received this week.
The Edge Report
Mondays are for the investors. Every Monday morning we share exactly what we’re watching in the week ahead, how we’re positioning, and even share a sneak peek into our systems and models. This week we discussed the US/Iran deal, the upcoming Fed decision, and our thoughts on the state of the market. See the latest full report here:
Stock Deep Dive - Microsoft
Our Deep Dive focused on Microsoft this week. See our thoughts on the company, our valuation models, price targets for 2026, and full analysis with the help of the Edge Scoring System. You can see the full deep dive here:
The Week Ahead
The two main things to watch next week will be Micron’s earnings and the latest PCE report. Both will move markets, as will any developments between the US and Iran.
Earnings Reports
Micron, one of the biggest names in the AI trade, reports earnings next week. After rising nearly 300% already this year and over 800% over the last year, you can bet all eyes will be on this report. Here is the full calendar of scheduled earnings releases:
Overall, just 2 of the names we cover are set to report:
Monday 6/22: --
Tuesday 6/23: FedEx
Wednesday 6/24: Micron
Thursday 6/25: --
Friday 6/26: --
Economic Reports
Next week’s focus will be inflation as we get the latest PCE report.
We also get PMI data, initial jobless claims, new home sales, consumer sentiment, and the Fed’s bank stress test results.
Here is the full calendar of events we will be watching:
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The Investor’s Edge
Disclosure
This is not investing advice. It is very important that you do your own research and make investments based on your own personal circumstances, preferences, goals and risk tolerance.
