Nasdaq, S&P 500, Dow Struggle as Geopolitics Collide With Fed Uncertainty
U.S. markets are trapped in a pressure cooker of global conflict and monetary policy indecision. The Dow Jones Industrial Average (DJI) added 100 points (0.2%), while the S&P 500 (GSPC) and Nasdaq Composite (IXIC) each gained a similar 0.2%. But this modest upside belied mounting investor anxiety over the possibility of U.S. military involvement in the Israel-Iran conflict and Wednesday’s critical Federal Reserve rate decision.
Trump’s Threats and Iran’s Response Add Oil to the Fire
Former President Donald Trump escalated tensions on Tuesday, warning Iran’s Supreme Leader Ayatollah Khamenei that America’s “patience is wearing thin” and demanding “UNCONDITIONAL SURRENDER” via social media. Iran retaliated verbally, threatening “irreparable damage” if the U.S. intervenes militarily. These developments sent energy stocks surging on Tuesday — the only sector to finish in the green — as Brent crude (BZ=F) rose above $77 and WTI (CL=F) crossed $76.
Federal Reserve Rate Hold Expected, Dot Plot in Focus
At 2 p.m. ET, all eyes will turn to the Fed’s decision. Markets broadly expect rates to remain unchanged. However, the dot plot — the FOMC’s projection of future rate moves — will be scrutinized for signs of potential cuts. Fed Chair Jerome Powell’s post-meeting remarks could ignite further market volatility, especially if he signals resistance to White House pressure for monetary easing amid escalating tariffs and trade concerns.
Housing Market Flashing Red Again
Fresh data from the Commerce Department revealed U.S. housing starts in May fell 9.8% to a seasonally adjusted annual rate of 1.256 million — the lowest level since the pandemic-hit May 2020. That missed expectations of 1.35 million by a wide margin. Building permits dropped 2% to 1.393 million, also underwhelming. It’s a sharp signal that the real estate sector is again stalling under the weight of high mortgage rates and economic uncertainty.
Labor Market Softens as Claims Hover Near 8-Month High
Initial jobless claims came in at 245,000 for the week ending June 14 — only a slight dip from the prior week’s 250,000, and consistent with a trend hovering near 8-month highs. Continuing claims fell marginally to 1.945 million, though still reflect the most elevated levels since November 2021. Investors interpret this labor data as evidence of a slowing job market, which could give the Fed cover to begin discussing future rate cuts.
Circle (CRCL) Surges Again as Stablecoin Legislation Advances
Circle Internet Group (CRCL) soared 7.34% to $159.87 as the Senate passed the GENIUS Act, a bill to regulate stablecoins backed 1:1 by USD or Treasury assets. Since debuting at $31 on June 5, Circle has exploded nearly 5x, now commanding a market cap of $32.8 billion — larger than United Airlines (UAL) and Cboe Global Markets (CBOE). The bill now heads to the House, and if signed by President Trump, could anchor crypto into U.S. financial law.
Korn Ferry (KFY) Spikes After Earnings Beat
Korn Ferry (KFY) jumped 9.16% to $72.88 after beating fiscal Q4 expectations with $1.32 EPS and $712 million in revenue (vs. $1.26 and $689.9M expected). Yet despite Wednesday’s gain, shares remain down over 1% YTD and nearly 4% for the past week, underperforming the broader S&P 500 which is up roughly 2% in 2025.
Silver Hits $37.40, Highest Since 2012, Diverging From Gold
Silver futures surged to $37.405 on Wednesday, a level not seen since February 2012, diverging from gold, which declined 0.2%. The silver-to-gold ratio has tightened as silver shows strength tied to industrial demand and safe-haven flows amid global instability.
Hasbro (HAS) Cuts Jobs as Tariffs Bite Into Toy Business
Hasbro (HAS) fell 3% after cutting 3% of its workforce — roughly 150 jobs — to control costs. The toy giant remains exposed to Chinese supply chains, making it vulnerable to Trump’s revived tariff campaign. CEO Chris Cocks warned the tariffs are “reducing profits for our shareholders” and raising consumer prices.
Nintendo (NTDOY) Soars 5.89% on Switch 2 Sales and Tariff Hedge
Nintendo (NTDOY) popped nearly 6% in the U.S. and as much as 7.1% in Tokyo after selling 3.5 million units of the Switch 2 in just four days. With tech and entertainment stocks seen as safer from trade shocks, funds are rotating into gaming. The surge gives Nintendo a fifth straight day of gains and its best rally in two months.
AMD (AMD), Tesla (TSLA), Micron (MU) Lead Morning Movers
AMD (AMD) rose over 1% on news it will collaborate with Microsoft on custom chips for future Xbox consoles. Tesla (TSLA) advanced premarket as xAI's $1B monthly AI costs drew headlines — and pushback from Musk himself. Micron (MU) gained after Wells Fargo reiterated a Buy rating and a $130 price target.
Investor Sentiment Remains Skeptical Despite Record Highs
While the S&P 500 trades near record levels at 6,011.53 (+0.48%), institutional investors aren’t convinced. Positioning remains light across hedge funds, mutual funds, and retail — even as indexes continue a sharp rebound from April lows. Strategists warn that lingering inflation, trade uncertainty, and rate ambiguity are weighing on confidence.
Oil Holds $76+ As Strait of Hormuz Risk Grows
Despite intraday dips, Brent (BZ=F) remains above $76, supported by fears the U.S. could enter the Israel-Iran conflict. A wider war could threaten the Strait of Hormuz, which handles a fifth of global oil flows. So far, Iran hasn’t targeted shipping — but crude markets remain on edge.
Buy, Sell, or Hold? Market at Crossroads as Fed and War Risks Collide
With the S&P 500 near 6,011 and Brent oil above $76, the market is delicately poised. Circle (CRCL) is a Buy with 5x gains post-IPO and pending regulation. Korn Ferry (KFY) is a Hold despite strong earnings, due to poor YTD performance. Hasbro (HAS) remains a Sell as tariffs weigh heavily. Watch for signals from Powell this afternoon — especially on rate cuts, as unemployment climbs and housing contracts. The macro pressure cooker is tightening, and any misstep could reverse recent gains.
