Last week delivered a mixed performance across major indices, with early optimism around U.S.-China trade developments giving way to late-week concerns over Middle East tensions. The SPY (S&P 500 ETF) managed a modest decline following its breakthrough above the psychologically important 6,000 level, while both QQQ (NASDAQ) and DIA (Dow Jones) retreated from earlier highs.

Market participants celebrated significant progress in U.S.-China trade negotiations, with both nations announcing a preliminary framework agreement during London talks. This development helped sustain the bullish sentiment that began with May’s stronger-than-expected jobs report, which showed 139,000 new positions versus the anticipated 126,000. However, geopolitical tensions emerged as Israeli strikes on Iranian facilities sent crude oil surging over 7% on Friday, raising fresh inflation concerns.

The week’s performance saw QQQ decline approximately 0.56% while DIA dropped 1.30%. Earnings season remained relatively quiet. Looking ahead, market participants will closely monitor Federal Reserve commentary and any developments in Middle East tensions that could impact energy markets and broader economic sentiment.

📅 Tuesday, Jun 17th

• Core Retail Sales m/m: The upcoming core retail sales month-over-month report will be closely scrutinized by markets given the previous reading of 0.1% and consensus forecast of 0.2%, representing a potential doubling of consumer spending growth in this key economic indicator that excludes volatile categories like automobiles, gasoline, building materials, and food services.
  
  Market participants should focus on whether the actual result exceeds the 0.2% forecast, as core retail sales serve as the primary gauge of consumer spending which accounts for approximately 70% of overall U.S. economic activity, making any surprise particularly significant for Federal Reserve policy expectations. A reading above 0.2% would likely boost the U.S. dollar and equity markets as it would signal robust consumer demand and economic resilience, while a miss below the 0.1% previous reading could trigger concerns about economic slowdown and potentially weaken the dollar as markets reassess growth prospects.

• Retail Sales m/m: The upcoming retail sales month-over-month report, presents a stark contrast between the previous month’s modest gain of 0.1% in April (including the volatile categories such as autos and gasoline) and economists’ forecast of a concerning -0.6% decline, representing a potential 0.7 percentage point negative swing that could signal significant consumer spending weakness. This anticipated decline comes amid heightened economic uncertainty driven by tariff policies and consumer caution.
  
  Market participants should closely monitor whether the actual figure beats, meets, or falls short of the -0.6% consensus forecast, as retail sales data typically triggers substantial market volatility across markets, with stronger-than-expected results potentially boosting consumer discretionary stocks and the US dollar, while weaker data could reinforce concerns about economic softening and influence expectations for Fed interest rate policy.

📅 Wednesday, Jun 18th

• Unemployment Claims: The upcoming weekly unemployment claims report will be closely watched after initial claims held steady at 248,000 for the week ending June 7, marking the highest level in eight months and exceeding economist forecasts of 240,000 to 244,000. Market participants should monitor whether claims breach the critical 250,000 threshold that economists now consider a potential recession warning signal, significantly lower than the historical 300,000 level due to structural labor market changes. Additionally, continuing claims deserve attention as they surged to 1.956 million, the highest since November 2021, indicating that unemployed workers are struggling to find new positions in a cooling labor market, which could signal broader economic weakness ahead.

• Federal Funds Rate: The Federal Reserve is widely expected to hold the federal funds rate unchanged at the current target range of 4.25% to 4.50% during the upcoming FOMC meeting, with CME FedWatch forecasting in less than a 1% chance of a rate cut this month. With inflation running at 2.4% annually in May 2025, Fed officials are maintaining a cautious “wait-and-see” approach amid heightened uncertainty surrounding President Trump’s tariff policies and their potential impact on both inflation and economic growth.

• FOMC Economic Projections & Statement: The upcoming FOMC meeting on June 17-18 will feature critical economic projections that market participants should closely monitor, with expectations that the median dot plot will maintain projections for two 25 basis point rate cuts this year, keeping the federal funds rate at around 3.75% to 4.0% by year-end from the current 4.25% to 4.5% range.
  
  Market participants should focus on revised economic forecasts showing potential stagflationary conditions, with GDP growth projections likely lowered to approximately 1.2% year-over-year in Q4 2025 (down from March’s 1.7% projection), unemployment rate expectations possibly rising to 4.5%, and core PCE inflation projections potentially increasing to 3.0% from the previous 2.8% forecast. The Summary of Economic Projections will be critical as Fed officials navigate policy uncertainty around tariffs and their inflationary impact, as well as any signals about the September meeting being the earliest potential rate cut timing.

Here are some of the large caps companies set to report earnings this week:

📅 Monday, Jun 16th

• Lennar Corporation (LEN): Lennar is set to report its earnings with analysts projecting revenue of approximately $8.18 billion (down about 6.72% year-over-year) and adjusted EPS near $1.94, compared with $3.32 a year ago. Market participants should focus on order and delivery guidance. Lennar forecasts 22,500–23,500 new orders and 19,500–20,500 home deliveries, as well as an average sales price of $390,000–$400,000 and gross margin on home sales is expected to be approximately. 18%, which will signal demand resilience amid affordability pressures. Market participants should also watch gross margins in the low-to-mid-teens range and any commentary on mortgage rate buydowns or incentive programs, key drivers of profitability and backlog growth in this challenging housing environment.

📅 Tuesday, Jun 17th

• Jabil Inc. (JBL): Jabil is set to report its earnings with analysts expecting an adjusted EPS of $2.31, up year-over-year from $1.89 in Q3 FY2024, on revenue projected near $7.06 billion, a 4.4% increase versus prior-year levels. Market participants should monitor any surprise in EPS relative to the consensus band, given Jabil’s streak of beating estimates in the past four quarters, and revenue guidance for the next quarter, as management commentary on supply chain pressures and end-market demand (e.g., cloud infrastructure and automotive) could sway stock reaction in the pre-market webcast. Margin trends will be critical too: watch for any shifts in non-GAAP operating margin guidance and core operating income, as incremental improvements or headwinds could signal the company’s ability to navigate cost inflation and pass-through pricing amid broader macro volatility.

📅 Friday, Jun 20th

• Kroger Co. (KR): Kroger is scheduled to report its earnings with analysts expecting earnings per share of $1.45 compared to $1.43 in the prior-year quarter, alongside projected revenue of $45.18 billion. Market participants should closely monitor identical sales growth excluding fuel, which Kroger forecasts at 2-3% for fiscal 2025, as well as digital sales momentum that has been growing at approximately 11% year-over-year, driven by strong performance in delivery services and customer fulfillment centers. Key metrics to watch include gross margin expansion trends following the 54 basis point improvement in Q4 2024, and the company’s ability to maintain its adjusted EPS guidance of $4.60-$4.80 for the full year amid ongoing competitive pressures and consumer spending shifts toward essential items.

• Accenture plc (ACN): Accenture is scheduled to report its earnings with analysts expecting earnings per share of $3.32 (up 6% year-over-year) and revenue of approximately $17.29 billion, representing growth of 4.9% compared to the prior year period. Market participants should closely monitor three key metrics: generative AI bookings growth (which reached $1.4 billion in Q2), operating margin performance against the company’s updated guidance of 15.6% to 15.7% for fiscal 2025, and new bookings momentum after the 3% decline to $20.9 billion reported in the previous quarter. The earnings call will be particularly significant as management provides updated guidance for the remainder of fiscal 2025, especially regarding the company’s narrowed revenue growth outlook of 5% to 7% in local currency and whether strong AI demand can offset broader IT spending caution among enterprise clients.

• Darden Restaurants (DRI): Darden Restaurants (parent company of Olive Garden) is set to release its earnings results with analyst consensus estimates projecting adjusted diluted EPS of $2.92-$2.94 and total revenue between $3.23-$3.26 billion, representing approximately 10.6% earnings growth year-over-year. Market participants should closely monitor same-restaurant sales growth expectations by analysts of over 3% across the portfolio, particularly at flagship brands Olive Garden and LongHorn Steakhouse, as the company faced weather-related headwinds in Q3 that resulted in only 0.7% same-store sales growth versus the 1.7% analyst expectation. Key focus areas will include management’s commentary on consumer spending trends, progress toward the full-year fiscal 2025 guidance of $12.1 billion in total sales and $9.45-$9.52 adjusted EPS, and the integration impact of the recently acquired Chuy’s restaurant chain on overall performance metrics.

We hope this helps and happy trading!

– Trade and Travel Team