Macro Events & News
Markets were volatile during the holiday-shortened week as investors closely monitored developments in the Middle East. While the situation remains tense, no significant escalation occurred—just a steady stream of threats and posturing along with the continued drone and missile attacks by Iran and Israel. Concerns were further escalated midweek following reports that President Trump was seriously considering military action, with credible chatter suggesting that strike plans were already in place. This fueled fears that the U.S. could be on the brink of entering a broader conflict. However, by late in the week, sentiment shifted after Trump stated he would make a decision on military involvement “within two weeks.” While that helped ease immediate fears, the open-ended timeline does little to resolve uncertainty—and with Trump, such timelines are rarely firm.
As expected, the Federal Reserve held rates steady following its June policy meeting. Fed Chair Jerome Powell came out on the hawkish side, stating that the economy remains on solid footing despite ongoing uncertainty. The Fed’s Summary of Economic Projections reflected a slight increase in year-end inflation and unemployment forecasts, alongside a modest downward revision to GDP growth. But more importantly, the median projection still calls for two rate cuts before year-end, consistent with the March outlook. Fed Governor Christopher Waller added fuel to the dovish narrative on Friday, hinting that a rate cut could come as early as the July meeting.
Retail sales for May came in weaker than expected, declining 0.9% versus the 0.7% consensus. This marked the second straight monthly drop and, while not definitive on its own, could signal early cracks in consumer resilience. It’s not yet a clear red flag—but worth watching.
The 10-year Treasury yield retreated to 4.37% on growing geopolitical concerns and the week’s economic data. The VIX was marginally lower for the week, closing at 20.62.
All the major indexes closed out the week relatively unchanged: the Dow unchanged, the S&P 500 down <1%, and the Nasdaq up <1%.
Watchlist News
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Baidu Inc (NASDAQ:BIDU) looked poised for a breakout after surging to $88 early Monday, but momentum quickly faded as sentiment turned negative. The stock slid steadily through the week, in line with broader weakness across Chinese ADRs. The pullback was driven by renewed concerns over China’s economic trajectory, as mixed macro data raised fresh doubts about the strength of the country’s recovery.
august bear notes
Baidu remains attractive at current levels, with this week’s pullback largely tied to macroeconomic concerns rather than company-specific developments. While retail sales in China showed some strength, continued weakness in industrial output and ongoing pressure in the housing sector weighed on investor sentiment. The silver lining is that Beijing has a long track record of stepping in with stimulus when needed and wields significant influence over the direction of the domestic economy. Once near-term fears subside, Baidu—given its leadership across AI, cloud, and autonomous driving—stands to benefit meaningfully. For investors looking to gain exposure with a margin of safety, selling cash-secured puts could be a worthwhile strategy.
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NVIDIA Inc (NASDAQ:NVDA) made several breakout attempts last week but consistently met resistance near the $146 level. Positive developments included Barclays raising its price target to $200 and confirmation that NVIDIA will participate in the International Supply Chain Expo in Beijing next month—an encouraging sign given ongoing U.S.–China tensions. However, broader market pressures stemming from Middle East instability and renewed warnings from the Trump administration that chipmaker waivers could be revoked likely offset much of the optimism.
august bear notes
NVIDIA’s price action during the past weeks speak to its underlying strength. Despite multiple macro headwinds, the stock has held its ground and shown resilience. The current overhang from geopolitical tensions, particularly in the Middle East, appears to be the main factor holding it back—not company fundamentals. Once sentiment stabilizes, attention should return to NVIDIA’s unmatched position in AI infrastructure and growth trajectory. Even in the event of broader conflict, NVIDIA’s business is unlikely to face direct disruption, and its recent China engagement signals it’s still positioning for long-term opportunity in that key market.
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Tesla Inc (NASDAQ:TSLA) struggled to hold onto gains this week as early strength, from the approaching robotaxi launch, gave way to broader market pressures. Geopolitical tensions weighed on sentiment, while news of strong BYD performance in Europe added competitive pressure. Additionally, emerging legislation aimed at reducing or eliminating government support for energy programs created a headwind for their growing energy segment.
august bear notes
The muted reaction after Tesla confirmed the robotaxi launch in Austin should raise eyebrows. This milestone has been teased for years as a key pillar of Tesla’s future—and now that it’s finally materializing, the market’s indifference suggests fatigue. Investors appear increasingly unwilling to reward hype without execution, especially given Tesla’s track record of overpromising. For a stock that often trades on narrative and momentum, that shift in sentiment is worrisome. It’s possible the real reaction will come after the service actually launches—or fails to—but until then, skepticism is starting to replace blind enthusiasm.
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Workday Inc (NASDAQ:WDAY) drifted lower over the course of the week, with price action weighed down by broader market anxiety and a lack of stock-specific catalysts as there were no company specific developments.
august bear notes
The week’s decline appeared driven more by broader geopolitical tensions than any company-specific weakness. Given Workday’s minimal direct exposure to Middle East dynamics, the stock is likely to stabilize as market focus returns to fundamentals. Volume was relatively low during the week except on Friday which was green in contrast to many other tech names. This is the price range where it fell to after posting FY26 Q1 earnings and could find support as the markets wait for clarity in the Middle East.
