Shesa's JUN 2025 Investment Blog

By Shesa Nayak

U.S. Stock Market Update 

The U.S. stock market had an incredible month of May. The S&P 500 added more than 5% in May, while Nasdaq was the star performer blasting 9.5%. Most of the gains were driven by tech and AI stocks. Despite tariff concerns, strong corporate earnings (about 12.5% Q1 growth) and a stable labor market supported stock market optimism. After a marathon run in May, the U.S. stock market in June has shown resilience amid trade tensions, economic uncertainties and high intensity of Geopolitical tensions. 

Israel, Iran War: Israel bombarded Iran and killed many of their senior leaders and Iran retaliated. The war intensified over the weekend between both nations. Israel has also attacked some of the oil fields. Wall Street was jittered last Friday due to the war. The reason is, if both these countries continue to battle then it may impact oil supply and oil prices would go up. Lat Friday, crude oil jumped around 10%. The worry is higher oil prices would push inflation and correspondingly Fed may further delay rate cuts. Usually, the stock market is impacted by such wars for a short period of time. Let’s see that this war doesn't continue for long and market bounces back sooner than later.

Economic: The inflation has been coming down for last few months, though it ticked-up slightly in May. Both CPI (Consumer Price Index - Inflation) increased mere 0.1% for the month, putting annual inflation to 2.4% as expected. The Producer Price Index (PPI) rose 0.1% and 2.6% year-over-year. All these numbers were less than expected by the economists. The non-farm payroll or job report for May showed 139,000 jobs were added vs. 125,000 expected. All these economic numbers were good news for the stock market. Now Investors eye Federal Reserve rate cuts, expected in late 2025.

Q1 2025 Earnings: The Q1 earnings are almost over. The S&P 500 revenue rose 4.5% but  the earnings growth saw 12.9% year-over-year increase which is very good. However, valuations are stretched (S&P 500 forward P/E near cycle highs), and risks like rising Treasury yields (10-year at 4.4%) and potential trade disruptions loom.

Tariff:  Trump’s Liberation day which started on April 9 had a 90-days waiver and that would come to an end on around July 9. There are lots of tariff negotiations between U.S and other countries going on. However, we will see how many of those will get materialized and whether the Trump administration will extend the deadline. 

Federal Reserve: The FOMC meets this week on Jun 17-18. I do not anticipate any rate cut. The Israel and Iran was has further complicated the inflationary situation.

Now, the question is with the current stock market bounce back but escalating Geopolitical situation and hesitant Federal Reserve, how would the market react? Well, I will share my thoughts but before that let's take a Quick Look to the stock market indexes. 

Indexes	Close TUE 12/30/24	Close FRI 5/16/25	Change in 2025	% Change in 2025	All Time High	From All Time High	% from All Time High
DOW	42,544.22	42,197.79	-346.43	-0.82%	45,073.63	-2,875.84	-6.38%
S&P 500	5,881.63	5,976.97	95.34	1.62	6,099.97	-123.00	-2.02%
NASDAQ	19310.79	19,406.83	96.04	0.50	20,204.58	-797.75	-3.95%
Russel 2000	2,230.16	2,100.51	-129.65	-6.17%	2,466.49	-365.98	-14.84%
SOX (Semi)	4,979.93	5,112.24	132.31	2.66	5,931.83	-819.59	-13.82%

Economy News

• Interest Rate: 4.5%. Markets expect the first cut in September!  U.S is exception..
• GDP Annual GDP: 2.1%, March (Q1): -2%
• CPI/Inflation: 2.4% (May)
• Producer Price Index (PPI): 2.6%
• NonFarm Payroll: 139K (May) vs. 125K. Unemployment: 4.2% 
• Retail Sales: down 0.1% vs. -1.2% expected
• PCE: 2.4% (Apr) vs. 2.6% continues to decline
• ISM Manufacturing: 48.5 in May vs. 48.7% (Apr). Below 50 is Contraction to economy.
• ISM Services: 49.9 vs. 52. 
• ADP Report:  just 37,000 jobs vs. 114,000 - April’s already-soft 60,000
• Consumer Confidence Index: 98 (May) up 12.8% highest in 4 years!
• Consumer Sentiment: 52.2 unchanged
• Mortgage Rate: 6.87% for 30-year Fixed.

Q2 earnings 

Earnings: For the second quarter, S&P 500 companies are expected to report year-over-year growth in earnings of 4.9% and year-over-year growth.

Valuation: The forward 12-month P/E ratio for the S&P 500 is 21.6. This P/E ratio is above the 5-year average (19.9) and above the 10-year average (18.4).

What to expect from the Stock market and my current strategy

• Big Tech companies has solid earnings bringing the AI momentum back
• Trade war was a noise as Trump extended Tariff for Trade war,  so how about month of June and ahead?
• In my view Jun should also be a good month unless the Geopolitical situation deteriorates. Why so?
• U.S. and China trade talk went well in London
• Tariff Negotiations to continue - Liberation day and April 9 - July 8 is 90 days after Liberation day. Per the administration, the negotiations may continues beyond the this timeline with the countries with whom negotiations are going well
• AI momentum to continue but always remember it’s never a straight line. Follow the market Trend - AI is and will continue to be the growth area for now and next few years. Hence, Invest on what’s working
• FED Meetings: Jun 17-18 but no rate cut expected. Europe has cut rates 8 times, India cut 1%. Almost all nations on the path except U.S.
• Historically, June and July have mostly been very good months for the Stock Market
• We are in BULL market, take advantage of it, but be prepared for the UNKNOWN. Neither the stock market nor any stock go up on a straight line. So, be optimistic but always ready for the pullback
• When Deregulations to come?? I guess only Trump may know… I can just speculate later part of this year..

Strategy

As part of my strategy nothing much has changed. Strategy does not keep changing always. We need to fine tune strategy based on the market situation. But I think if there is further pullbacks  in the stock market then it may provide good buying opportunity. Here are some strategies that I would like to emphasize.

• Always HOLD some CASH to leverage market pullback
• Watch the market trend and Invest accordingly. Put Money on what’s working, not what’s losing…
• Have patience and thoughtful execution, not to be thrilled or too depressed
• Have some mitigation strategy: taking constant profits, hedging the portfolio
• Think long term but current market provide great short term trading opportunity in momentum stocks - “Tactical trading” - not day trading as it’s extremely risky
• Always have a conscious buy list on you comfort level: Decide fast and act fast - market may not wait to long thinkers..
• Avoid buying all position at once - if we accumulate then must have clarity on why I am accumulating and how far should I accumulate
• Avoid hanging with losers, same money can be better utilized with good stock which has chances of faster turnaround and better ROI. 
• The most difficult thing is to have patience to keep accumulating when a good stock is down and may take sometime to recover. If recovery is not on the horizon, avoid it or accumulate very slowly.
• Be aware to avoid catching falling knife. Cheap stocks become cheaper and then worthless sometime.

Stock Market TOP sectors for 2025

Sector	YTD Performance in %age
Industrial (TOP)	7.95%
Utilities	6.76%
Communication Services	5.63%
Consumer Staples (Best)	4.57%
Materials	3.76%
Consumer Discretionary (Worst)	-6.74%

You can click below link to view complete sectorial performances:

Source: https://www.barchart.com/stocks/sectors/rankings?timeFrame=Ytd

Now let me discuss this month’s hedging pick for my Blog Portfolio.

Applied Digital (APLD)

Applied Digital (APLD) designs, builds, and operates next-generation data centers, focusing on AI, high-performance computing (HPC), and cloud services. It provides infrastructure for GPU-intensive workloads, primarily serving hyperscalers and AI-focused companies. The company operates facilities like its 400 MW campus in North Dakota, offering colocation and managed services with a shift toward a data center REIT model.

Why do I like APLD?

The Artificial Intelligence (AI) momentum continues and expected to continue for the foreseeable future. This was proved by the big tech companies earning - MSFT, NVDA, AMZN, META, GOOG etc. All these companies came with solid earnings and emphasized on continued spending on AI. All these companies came with solid earnings. But let’s not forget that these big tech companies rely on data centers to store, process, and manage the vast amounts of data generated by their services and users. Hence, they need the data centers which can be constructed by them or rely on the companies who have the expertise to do. This is where Applied Digital comes into picture. So, let’s see a few important developments that excited me to take position in APLD. 

Applied Digital (APLD) and CoreView (CRWV) Deal: Applied Digital signed two 15-year lease agreements with CoreWeave (CRWV) on June 2, 2025, for 250 MW of AI data center capacity in North Dakota, expected to generate $7 billion in revenue. CoreWeave has an option for an additional 150 MW. The deal boosted APLD’s stock by about 95% that week. Analysts raised price targets citing revenue stability and APLD’s pivot to a data center REIT model. CoreWeave which went IPO on March 28 has gone up almost 200% since then. There were news that CRWV sold its stake in APLD and that’s the reason the stock has come down about 27% in last few days. And this is where I see the opportunity. I do not know why CRWV sold its take in APLD but in my view, probably CoreView did not want conflicting interest with its partner APLD. Though some folks say CoreView may be preparing its own data center. In that case, why did it sign such a huge deal with APLD for 15 years?? Hence, I do not agree with such arguments. Note: I also like CRWV stock a lot but it has gone up significantly, so it looks little risky to add to my blog portfolio at this time.

APLD-ABB Partnership: APLD launched an infrastructure partnership with ABB at its 400 MW North Dakota campus, announced on June 11, 2025. APLD’s data centers, enhancing credibility in the AI infrastructure space excited ABB. Specific financial details are undisclosed, but the partnership signals operational strength for Allied Digital. 

Revenue Impact: For last one year APLD had a revenue of just $221 million. But please note that only CRWV deal itself will generate about $0.5 billion in revenue, which means that revenue doubles only with this one deal. In addition, it has stuck another deal with ABB. Furthermore, the big tech e.g., Meta, Amazon, Google, Microsoft seeks scalable, high-density data centers for their AI and cloud expansion. APLD’s GPU-ready facilities and 1.3 GW pipeline makes it very attractive for these tech companies to look towards APLD. If it happens, think about the revenue explosion and stock price!

Stock Impact: The CRWV deal drove a massive rally, with APLD up 105% in last one year and about 300% from its one year low. Though some warn of overvaluation (forward P/S ~6x vs. industry 3.5x), I feel lots of room to grow for the stock. The ABB partnership reinforces APLD’s growth narrative, likely sustaining bullish sentiment. The deals position APLD as a key AI infrastructure player, likely supporting further stock gains if execution delivers, but caution is warranted due to valuation and risks.

Strategy

The stock is currently trading at $11.18. The 52-week high for this stock is $15.42. So, that’s a discount of about 27% from its high. As most of my blog reader know, I am  growth investor and usually I never buy any stock at once. I always buy in small quantities in a phased manner. And I use such opportunity to accumulate and build my portfolio. I have been accumulating APLD stock and some long term options for last few weeks as I see a huge long term opportunity. Hence, I thought it’s the right time to put it on my blog. When there is bump up, it’s extremely important to take some chips out of the table and book some profits to mitigate risks and generate some cash. 

Risks:

There is no saying that it won’t go down further. A couple of risks include high short interest, execution challenges, and reliance on CoreWeave. But remember, higher short interest may also take this stock crazy with short covering on any good news. Furthermore, if stock market goes down it may get hit further. Nobody can predict the top or bottom of a stock. Particularly, growth companies stocks are very volatile. So, one must keep an open eye on when to accumulate and how much to accumulate. Hence, it’s suitable for growth investors who wants to take some risks. The risk averse investors must take a cautious look.

My final thoughts

Applied Digital (APLD) has come to the lime light due to strengthening of AI and Data Centers. It has stuck two large deals in last 2-3 weeks. I think this may be just the beginning and may pen more deals in the future. Hence, it has a great potential for long term. The AI boom may not go up on a straight line, it never does. But we are in the middle of this AI boom, so it may have a long way to go. I believe on this and hence it excites me. Having said that, if I see any red flag in any of my holding, then I won’t hesitate to pull the trigger irrespective of how great the company/stock may be. I don’t fall in love with any of the stock, take the current opportunity based on the and leverage on the situation whether to buy or sell. So, emotions should not impact our investment. At this time, I feel APLD has a huge potential, hence I am invested.

A few Equity/Stocks to watch this week

TSLA: The stock was the only one to be on green last Friday. It has RoboTaxi scheduled to start pilot run in Austin on 6/22.

• META
• AVGO
• NVDA
• NFLX
• CRWV
• APLD
• SOXL
• TQQQ
• CVNA
• HOOD
• RXRX
• IONQ, QUBT, QBTS

Shesa’s Blog Portfolio (As of JUN 15, 2025)

Equity	Suggested Price	Current Price	Suggested Date	% Change	My View  (see disclaimer)
STOCK (All prices are in USD)
AAPL	12.9	196.45	1/25/13	1423%	HOLD
META	47	682.87	11/13/13	1353%	Accumulate on dip
MA	77.18	562.03	12/12/13	628%	HOLD
AMZN	15.58	212.1	4/12/14	1261%	Accumulate on dip
SHOP	13.48	105.34	11/25/18	681%	HOLD
SPG	54.59	156.9	5/25/20	187%	HOLD
NVDA	23.9	141.97	2/13/22	494%	Accumulate on dip
TSLA	290.25	325.31	5/1/22	12%	Accumulate on dip
RDFN (RKT)	8.87	12.5	4/6/23	22%	Acquired by RKT @12.5
SOXL	15.66	20.04	4/6/23	28%	Accumulate on dip
GOOG	123.25	175.88	5/21/23	43%	HOLD
PLTR	20.49	137.4	11/19/23	571%	HOLD
PANW	142.06	196.27	3/31/24	38%	HOLD
ENVX	10.48	8.22	4/28/24	-22%	HOLD
Z	51.92	70.37	8/11/24	36%	HOLD
LRCX	76.16	89.52	11/11/24	18%	HOLD
RXRX	6.76	4.92	1/2/25	-27%	Accumulate
IONQ	37.46	37.84	2/18/25	1%	Accumulate on dip
UVXY	39.79	27.71	4/6/25	-30%	HOLD - only for HEDGE
AVGO	203.64	246.93	4/5/25	21%	Buy on Dip
APLD	11.18	11.18	6/15/25	0%	NEW ADDITION
	ETF
IHF	27.82	47.91	8/16/15	72%	HOLD
MUTUAL FUND
PRMTX	59.45	163.29	12/20/14	175%	HOLD
FSRPX	9.05	18.48	1/15/16	104%	HOLD
FSMEX	43.66	58.64	9/24/17	34%	I may SELL on Monday

Economic report this week (6/16 - 6/21)

Tue, 6/17:   U.S. Retail Sales

Wed, 6/18:  FOMC meeting, Fed Chair Powell press conference.

Equity Sold since my Last Blog

None

Note: I have added back a small position in Super Micro Computer (SMCI)

Here is my YouTube channel link:  https://www.youtube.com/channel/UCt7oLVUMG3NkJUzAVUzl4Tg

Disclaimer: This blog is meant to provide my opinion only. The information provided is to the best of my knowledge but may not be accurate. I do NOT provide any professional recommendation to buy/sell any stock, ETF, mutual fund, or any other security(s). As an investor, it’s your hard-earned money and you decide what is best for you. The above are merely my own opinions on what I do. Please contact a professional money manager to buy/sell any security. I do not charge any fees or commission by writing the blog except anything from Google AdSense. I have position(s) on whatever security I put on my blog portfolio and avoid including any security that I do not own or follow. Anyone buying or selling the equities mentioned here must do at their own risk.

Note: Click on Blog archives to read all my Blogs and updates.