Anna's Markets Recap

_{Just facts, you think for yourself}

Saturday, 5:25 AM

June 21, 2025

Good morning news friend! Here is a quick recap of what happened in the markets this week. 📰🌟

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What Moved Markets Last Week

IThe market had a case of whiplash last week. Things started on a high note, with fresh data showing inflation continued to cool. The Consumer Price Index (CPI) rose just 0.1% in May, bringing the annual rate to a more comfortable 2.4%. But that optimism didn't last long. On Wednesday, the Federal Reserve held the federal funds rate steady in its 4.25% to 4.50% range, which was expected. What wasn't expected was the Fed’s cautious tone for the future.

Fed officials raised their 2025 inflation forecast to 3.0% and lowered their GDP growth expectation to 1.4%. Fed Chair Jerome Powell said uncertainty around potential tariffs was a key reason for the guarded approach. This signaled to investors that the bar for a rate cut is now higher than the economic numbers alone might suggest.

The market’s reaction was a perfect reflection of this conflict. The S&P 500 ended the week down 0.2%, giving back its early gains. The Nasdaq managed a small 0.2% gain, while the Dow was nearly flat. In short, good news on inflation wasn't enough to overcome the Fed’s cautious outlook.

Tech and Growth

The tech sector was a mixed bag. Some companies hit new highs, while others stumbled.

Microsoft (MSFT) shares reached a new record, closing at $480.24 on Wednesday. The company announced plans for job cuts, but investors saw it as a smart move to help fund its massive $80 billion investment in AI infrastructure.

Amazon (AMZN) also had a good week. It announced a new advertising partnership with Roku, a move that should boost its high-margin ad business, which already grew 18% in the first quarter.

Meta Platforms (META) saw its stock climb above $700 after announcing it will finally bring paid ads to WhatsApp. This could open up a huge new source of revenue from the app's 1.5 billion daily users.

On the other hand, Alphabet (GOOGL) had a tough week. Its stock fell nearly 4% on Friday after a top advisor to a European court recommended upholding a massive 4.1 billion euro ($4.7 billion) fine against the company for its Android business practices.

Apple (AAPL) shares also weakened, falling from over $198 to under $197. On Friday, a class-action lawsuit was announced, claiming the company misled investors about its AI progress.

Tesla (TSLA) stock slid from $329 to $322 after a report on Tuesday that it plans a week-long production halt for its Cybertruck and Model Y vehicles.

Banks and Financials

Financials dealt with the Fed’s steady rates and a new threat from the world of crypto.

The big story was the sharp sell-off in Visa (V) and Mastercard (MA). Visa plunged from over $355 to $340, while Mastercard fell from over $568 to below $540. The drop came after news that a U.S. Senate bill to regulate stablecoins was moving forward. For years, crypto was seen as a distant threat. This news made it real.

Traditional banks fared better. JPMorgan Chase (JPM) shares rose from $270 to nearly $274 after it announced new features for its retail investing platform. Bank of America (BAC) also climbed as it took steps to manage its debt profile, including redeeming $3 billion in senior notes.

Consumer Goods and Healthcare

Defensive stocks showed a mix of results as investors weighed news from clinical trials and worried about consumer spending.

AbbVie (ABBV) had a wild ride. On Monday, the company announced a cancer drug trial had failed. But on Wednesday, it reported that its migraine drug proved superior to a competitor in a head-to-head study. The company also declared a quarterly dividend of $1.64 per share.

Eli Lilly (LLY) saw its stock fall from over $807 to $785. While the company's weight-loss drugs are a huge success, its high forward price-to-earnings ratio of 37 makes the stock an easy target for profit-taking.

Retailers faced questions about consumer health. Procter & Gamble (PG) and Costco (COST) shares declined on concerns about their high valuations. Walmart (WMT), however, held steady, as its budget-friendly focus continues to earn confidence from analysts.

Energy and Industrials

The performance of energy and industrial stocks told a story about the real economy.

Exxon Mobil (XOM) shares tracked the price of oil, rising to a high of $115.24 before pulling back. The company also made headlines by warning its shareholders to reject a "mini-tender" offer from an investment firm trying to buy shares for $100, well below the market price.

Home Depot (HD) stock was flat, and for good reason. The U.S. housing market is sending very mixed signals. While the median home price hit a record $396,500, both housing starts and building permits plunged in May to their lowest levels in five years. This slowdown in construction is a direct hit to Home Depot's important professional customer business.

Commodities

Gold prices were volatile during the week. The metal started strong, hitting $3,384.50 per ounce on safe-haven demand. However, gold gave back those gains and fell to $3,367.99 by Friday as the U.S. dollar firmed up following the Fed’s announcement.

Did you know we also write in-depth deep dives? They are long, packed with insights, and have received rave reviews. If you’re up for a detailed, action-packed read, check them out:

• Deconstructing the $66 Billion Citiadel Enigma

• The U.S. Debt Trajectory, Assessing the Risks of a $36 Trillion Liability

• Private Equity, Unpacking the Engine Room of Modern Capitalism

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Baked with love,

Anna Eisenberg ❤️