Daily Game Plan

TODAY’S GAME PLAN:  from the trading
desk, this is not research

TODAY’S ECONOMIC DATA:  08:30ET Philadelphia Fed Business Outlook; 10:00ET Leading Index

Highlights and News:  

• ISRAEL TO COMPLETE IRAN TASK WHETHER OR NOT US JOINS: MINISTER
• CHINA WILLING TO STRENGTHEN ENERGY COOPERATION W/ RUSSIA: DING
• Iran to Meet European Officials in Geneva Today
• IRAN SAYS INTERNET ‘RESTRICTED’ FOR NATIONAL SECURITY: IRIB
• IRAN IS READY TO DISCUSS LIMITATION ON URANIUM ENRICHMENT: RTRS
• Goldman and Citi See Europe’s Economy Powering Stock Rally
• AI tools are now churning out millions of their own tunes at the click of a button

Global stocks edged up after Trump indicated he would prioritize diplomacy before deciding on military action against Iran, stepping back from earlier remarks hinting
at imminent strikes. The White House said on Thursday that President Trump would decide on US action in the next two weeks. Iran said today that it would not negotiate the future of its nuclear program while under attack by Israel, as Europe pushed to reengage
Tehran in talks. Israel, meanwhile, struck more of Iran’s nuclear sites and warned it could bring down Tehran’s leadership. US tariff hikes on small packages from China caused a 40% drop in shipments in May, to just over $1 billion as the US government eliminated
a long-standing tariff loophole. In the coming week, traders will be keeping an eye on Thailand’s interest rate decision, as well as inflation numbers out of Singapore, Malaysia, Australia and Japan.  A World Economic Forum meeting known as the “Summer Davos”
will be held in China over June 24-26.

EQUITIES:   Today is Triple Witch/Quarterly
Expiry

US equity futures reverse Thursday’s losses following news that Trump will take time to consider any US strikes against Iran, easing fears of an imminent attack. Contracts on the S&P
500 are back in the green after dropping 0.9% on Thursday when US markets were closed for the Juneteenth holiday. Investors are set for $6.5 trillion of notional US options expiring today, in a ‘triple witching’ event that’s seen as one of the largest expiries
on record. Citi strategists maintain their overweight view on equities as they expect the impact from Middle East tensions on risk assets to be short-lived. Softbank founder Masayoshi Son is said to be seeking to team up with Taiwan Semiconductor to build
a trillion-dollar industrial complex in Arizona to build robots and artificial intelligence.

Futures ahead of the bell: E-Mini S&P +0.1%, Nasdaq +0.2%, Russell 2000 +0.9%, DJI +0.1%.

In pre-market trading, Accenture shares (ACN) are down 3.9%, after the IT services company reported its third-quarter results and gave an outlook. Capricor Therapeutics
shares (CAPR) fell 4.4% after Nicole Verdun, super office director at Center for Biologics Evaluation and Research, was placed on administrative leave. Circle Internet Group shares (CRCL) are set to extend gains, rising 11%. The stablecoin issuer rallied almost
34% on Wednesday after the US Senate passed stablecoin legislation setting up regulatory rules for crypto currencies pegged to the dollar. GMS shares (GMS) rise 28% after the Wall Street Journal reported that Home Depot has made an offer for the building materials
firm, potentially setting off a bidding war with QXO which made a $5 billion offer earlier in the week. Johnson Controls International (JCI) fell 1% after Oppenheimer cut its recommendation on the building products company to perform from outperform. Tesla
(TSLA) is outperforming fellow Magnificent Seven stocks, rising 1.7%.
Tesla (TSLA) is outperforming fellow Magnificent Seven stocks, rising 1.7%. Tesla is set to open India showrooms in July with made-in-China EVs.

European gauges gain as the White House downplays the likelihood of imminent US military action against Iran. UK retail sales slumped a more-than-expected 2.7% in May
from the previous month, versus estimates of -0.5%. The Stoxx 600 is trying to snap a three-day losing streak, though remains on track for its first back-to-back weekly declines since the start of April. Travel and bank sectors lead gains with only energy
sector in the red. Among individual movers in Europe, TUI AG gained 7%, the most in two months after Barclays Plc double-upgraded the stock, citing robust demand for packaged travel. Berkeley Group Holdings slumped over 7% after the homebuilder announced management
changes and cited persistent regulatory headwinds as it reported earnings.  Stoxx 600 +0.7%, DAX +1.5%, CAC +0.9%, FTSE 100 +0.4%. Travel & Leisure +1.8%, Banks +1.5%, Technology +1.4%. Energy -0.6%.

Shares in Asia were mostly higher on relief that fears of an imminent U.S. attack on Iran appeared to have been forestalled for now. The MSCI Asia Pacific Index gained
0.5%, with chip-related stocks SK Hynix and Advantest among the biggest boosts. South Korea’s Kospi closed above 3,000 points for the first time since December 2021. South Korean cosmetics and movie stocks soared after the government unveiled an extra budget
worth billions of dollars that includes consumption vouchers to all citizens. Japanese gauges fell though semiconductors climbed after Taiwan strengthened restrictions on semiconductor exports from China. Japan’s core CPI hit a fresh 2-year high of 3.7%, ahead
of summer elections, while the government plans reduced issuance of super-long bonds to calm markets. Shares of project financing firms led gains among India’s financial companies after the nation’s central bank eased lending norms. Kospi +1.5%, Sensex +1.3%,
Hang Seng Index +1.25%, Taiwan +0.2%, CSI 300 +0.1%. Thailand -0.1%, Vietnam -0.2%, ASX 200 -0.2%, Philippines -0.3%, Singapore -0.3%, Topix -0.7%, Indonesia -0.9%.

FIXED INCOME: 
 

Treasuries hold modest losses across maturities as US markets reopen post-holiday. US Treasury yields rose overnight due to President Trump’s decision to give Iran
two weeks while Iran says it’s not ready for talks until Israel stops their attacks. US yields are higher by 2bp-4bp across a steeper curve, with 2s10s and 5s30s spreads wider by 1bp-2bp; 10-year near 4.43% is 2.8bp cheaper vs Wednesday’s close.  Elsewhere,
Japan’s Finance Ministry plans to cut the issuance of 20-, 30-, and 40-year bonds by ¥3.2 trillion ($22 billion) through the end of March 2026 to restore calm to the market. The ministry will compensate for the cuts by boosting the issuance of shorter-term
debt.

METALS: 

Gold is down some $22 to around $3,348/oz and headed for a weekly drop due to easing geopolitical tensions in the Middle East and a Federal Reserve inflation warning.
US President Donald Trump will decide whether to join Israel’s attacks on Iran within two weeks, his spokeswoman said, reducing fears of imminent action that could escalate hostilities, threaten energy flows and spur inflation. Spot gold -0.6%, Silver -1.0%,
Copper ~flat.

ENERGY:   

Oil prices are mixed, with Brent sliding as WTI inches up after the White House dialed back speculation that the US was on the verge of joining Israel’s strikes on
Iran. Brent futures have been pricing in a geopolitical premium of about $8 a barrel since Israel and Iran began attacking each other last week, according to a survey of analysts and traders. Israel will complete the task of preventing Iran from gaining nuclear
weapons whether or not the US joins the operation, its energy minister said. Iranian President Masoud Pezeshkian said the only way to end the war is to “unconditionally” stop Israel. Iran’s Foreign Minister Abbas Araghchi will meet European officials in Geneva
today for nuclear discussions. WTI +0.3%, Brent -2.5%, US Nat Gas +3.4%, RBOB +0.8%. 

CURRENCIES: 

In currency markets, the dollar fell against most Group-of-10 currencies as fears of an imminent US attack on Iran abated.  Trump is set to decide within two weeks
whether to strike Iran, saying “there’s a substantial chance of negotiations” in the near future. The yen slipped as Japan’s key consumer inflation measure accelerated more than expected to 3.7% from a year earlier in May, a fresh two-year high. Norway’s crown
slid roughly 1% against the dollar and the euro, in a sign of how unexpected Norway’s shock rate cut on Thursday was. On Thursday, Switzerland reduced borrowing costs to 0%, surprising some traders who anticipated a return to negative rates in the deflation-stricken
country, with the central bank cautioning about an uncertain global economic outlook. And Switzerland, cut borrowing costs to 0% on Thursday, surprising some traders who anticipated a return to negative rates in the deflation-stricken country, with the central
bank cautioning about an uncertain global economic outlook. The euro is gaining prominence in the global currency options market as traders avoid the dollar due to unpredictable US policy and global trade war risks. US$ Index -0.2%, GBPUSD +0.5%, EURUSD +0.3%,
USDJPY +0.3%, AUDUSD -0.3%, NZDUSD -0.6%, USDCHF -0.1%, USDCAD +0.1%, USDSEK +0.1%, USDNOK +0.9%.

Bitcoin +1.5%, Ethereum +1.6%.  Financial commentator Peter Schiff expressed his intent to launch a gold-backed stablecoin Thursday, questioning the value of those
backed by the U.S. dollar.  

Colors within the report:
Green is always the 200 period (day, week).
Red is always 21,
Blue = 50,
Brown =
100 *Stars have added importance 

• Upgrades
• Apple (AAPL) Raised to Buy at First Shanghai; PT $230
• Asante Gold (ASE CN) Raised to Buy at Clarus Securities; PT C$5
• Charter Communications (CHTR) Raised to Peerperform at Wolfe
• CubeSmart (CUBE) Raised to Outperform at BMO; PT $49
• Dorian LPG (LPG) Raised to Buy at Arctic Securities; PT $32
• EPR Properties (EPR) Raised to Buy at Stifel; PT $65
• Mondelez (MDLZ) Raised to Overweight at Wells Fargo; PT $78
• Downgrades
• AMD (AMD) Cut to Hold at Punto Casa de Bolsa; PT $136
• Coinbase (COIN) Cut to Hold at Punto Casa de Bolsa; PT $269.83
• Dow (DOW) Cut to Hold at Fermium Research; PT $30
• Guild Holdings (GHLD) Cut to Market Perform at Citizens
• Jack in the Box (JACK) Cut to Hold at Stifel; PT $20
• Johnson Controls (JCI) Cut to Perform at Oppenheimer
• Patriot Battery Metals (PMET CN) Cut to Speculative Buy at Argonaut Securities; PT C$6.20
• Public Storage (PSA) Cut to Market Perform at BMO; PT $325
• Sarepta (SRPT) Cut to Market Perform at William Blair
• Initiations
• Adeia Inc (ADEA) Rated New Buy at Roth Capital Partners; PT $26
• Chagee Holdings (CHA) ADRs Rated New Buy at Deutsche Bank; PT $40.50
• Circle Internet (CRCL) Rated New Buy at Seaport Global Securities
• Contineum Therapeutics (CTNM) Rated New Outperform at William Blair
• Crescent Biopharma Inc (CBIO) Rated New Buy at TD Cowen
• Everest Group Ltd (EG) Rated New Buy at Janney Montgomery; PT $425
• Gran Tierra (GTE) Rated New Market Perform at Raymond James; PT C$10
• Kingsoft Cloud (KC) ADRs Rated New Buy at Daiwa; PT $17
• Metsera (MTSR) Rated New Overweight at Wells Fargo; PT $65
• NCR Atleos (NATL) Rated New Outperform at Wedbush; PT $35
• Replimune (REPL) Rated New Overweight at Cantor
• Snowflake (SNOW) Rated New Outperform at CICC; PT $225
• TPG (TPG) Rated New Outperform at Wolfe; PT $60

Data sources: Bloomberg, Reuters, CQG

David Wienke