Market in a cooling-off period (along with oil prices)

Briefing.com Summary:

*Conviction is lacking in the equity futures market following a big move on Monday.

*Oil prices continue to slide, with WTI crude below $80.00/bbl, as participants anticipate better oil flows on a U.S.-Iran peace deal.

*The May Import-Export Price Index showed that inflation remains a problem.

It was a big day yesterday for the biggest stocks, but it wasn’t a bad day yesterday for the smallest stocks either. The Russell 2000 raced to a new record high, as did the Dow Jones Industrial Average, yet it was the mega-cap stocks and semiconductor stocks that led the market’s advances.

It was a slippery slope, so to speak, yet the major indices made it to higher ground with falling oil prices aiding their advance. WTI crude futures settled Monday’s session down 4.7% at $80.90/bbl, driven by the news that the U.S. and Iran had digitally signed a memorandum of understanding for an extension of the ceasefire and a 60-day window to negotiate Iran’s nuclear program.

One of the main understandings of this agreement is that it was short on details, but that didn’t stop the stock market from seeing an endgame that finishes on Kumbaya Boulevard. Accordingly, stocks were quick to discount the arrival of lower oil and gasoline prices that will presumably translate into better discretionary spending activity, less pressure on the Fed to raise rates, and better growth all else equal.

WTI crude futures have continued their slide today. They are currently down $3.40, or 4.2%, to $77.35/bbl, yet stocks are not currently going along for that ride.

The S&P 500 futures are down two points and are trading fractionally below fair value, the Nasdaq 100 futures are down 46 points and are trading 0.1% below fair value, and the Dow Jones Industrial Average futures are up 128 points and are trading 0.2% above fair value.

The market is in a cooling-off period, having been reminded that inflation remains a problem and that higher rates have hung like a wet blanket on the housing market.

Specifically, import prices jumped 1.9% month-over-month in May and were up 6.7% year-over-year. Excluding fuel, import prices rose 0.8% month-over-month and were up 3.7% year-over-year. On the export side, prices were up 1.3% month-over-month and up 11.2% year-over-year. Excluding agricultural products, export prices increased 1.2% month-over-month and were up 11.8% year-over-year.

Housing starts, meanwhile, plummeted 15.4% month-over-month to a seasonally adjusted annual rate of 1.177 million units (Briefing.com consensus: 1.440 million), with single-unit starts down 1.9%. Building permits were down 0.7% month-over-month to a seasonally adjusted annual rate of 1.413 million (Briefing.com consensus: 1.410 million), with single-unit permits up 0.6%.

The key takeaway from the report is that the weakness in starts was concentrated on the multi-unit side, as starts there were down 40.2% month-over-month, yet it would be remiss not to mention that single-unit starts in the South—the largest homebuilding region—were down 5.2% month-over-month.

The Treasury market had a fairly muted reaction to the data. The 10-yr note yield is down three basis points to 4.44%, which is where it stood prior to the release of the data.

There has been nothing muted about the price action in SpaceX (SPCX) since its debut on Friday. Yesterday, the stock soared 20%, and it is up another 4.7% in today’s pre-market trading. That goes to show that there is still some speculative energy in this market, even though the equity futures market is looking relatively subdued at the moment.

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Originally Posted June 16, 2026 – Market in a cooling-off period (along with oil prices)