Macro

A Republican-backed spending bill passed by the Senate would eliminate the $7,500 federal tax credit for new EVs after September 30, impacting consumer incentives and automakers' sales strategies. The move, part of a broader tax package, could slow EV adoption and disproportionately affect middle- and lower-income buyers, with market implications for EV affordability and climate goals.

Consumer sector sentiment is mildly bearish this month, weighed down by political momentum behind the proposed elimination of the $7,500 EV tax credit by September, a move that threatens near-term demand for electric vehicles. While broader consumer spending remains stable, the rollback of incentives in a key growth category is dampening sector momentum and contributing to a cautious outlook.

A hostile policy year: RFK Jr. as HHS Secretary rattled vaccine makers and FDA credibility, Trump's most-favored-nation order threatened to slash US drug prices to foreign levels, tariff threats loomed, and UnitedHealth crashed on a DOJ probe and guidance cuts. Broad…

Trump's tariff escalation raised construction and material costs and kept inflation and rates elevated, leaving housing sluggish and office CRE still distressed though bottoming in some markets; a grinding, modestly negative year for owners.

A turbulent year, Trump's tariff escalation (the April 'Liberation Day' crash), threats to Fed independence (firing attempts at Cook and the BLS chief), and a crypto plunge from its peak whipsawed markets, while LA wildfires slammed insurers.

Trump's tariff escalation was double-edged — protecting domestic producers but shocking supply chains and inviting retaliation (April 'Liberation Day' plunge) — yet accelerating reshoring and a roaring data-center power/electrical-equipment cycle drove strong order books…

PJM's capacity auction for the 2026-27 delivery year cleared at the $329.17/MW-day price cap across most of its 13-state footprint, up 22% from last year's record, with total costs rising to $16.1 billion as forecast peak load grew about 5,500 MW, mainly from data centers. PJM said the result could push some retail bills up 1.5% to 5%, a windfall for generators including Constellation Energy, Vistra, Talen Energy, NRG Energy and Public Service Enterprise Group, while Exelon weighed re-entering regulated generation. Consumer advocates decried the costs and analysts warned state policymakers are weighing options to reduce or exit the PJM capacity market.

Energy sector sentiment is neutral this month despite a record 22% jump in PJM capacity prices, which signaled tight supply margins in the region. The broader market remained unmoved as the event, while notable, was seen as an isolated regional development rather than a systemic shift in national power markets. No other major drivers emerged to alter the sector’s overall near-term outlook.

Meta and Alphabet AI-ad strength kept owners positive, interrupted by the January DeepSeek shock and April's Trump tariff selloff that raised hardware-cost and recession fears. Positive with a spring dip.

Nvidia reached a $4 trillion market cap, driven by explosive demand for its AI chips and record quarterly earnings of $18.8 billion on $44.1 billion revenue. The surge underscores its dominance over tech giants like Apple and Microsoft, propelling the S&P 500 despite broader economic risks.

The tech sector is trading bullish this month, buoyed by Nvidia's milestone as the first $4 trillion company, a direct reflection of sustained investor confidence in AI-driven growth. This surge underscores broad strength in semiconductor leadership and cloud infrastructure demand, anchoring sector momentum despite elevated valuations. The broader market backdrop remains supportive, but the rally is rooted in tangible sector-specific momentum.

Data-center power supercycle and nuclear/gas-turbine demand reaccelerate

Gold topped $4,000 for the first time on the debasement trade, silver and precious metals surged, and China's sweeping rare-earth export controls handed pricing leverage to Western critical-minerals producers, a euphoric year for hard-asset owners.

European rearmament (the EU 'ReArm Europe' plan), the June NATO 5% spending target, and the June Israel-Iran war with US strikes on Iran's nuclear sites drove euphoric demand; China's rare-earth export curbs added an input-supply risk but demand overwhelmed it.