U.S Stock Market Weekend Update - 5|31|25

The month of May ended with a spectacular market performance. The S&P 500 added more than 5% this month, while the Nasdaq rocketed 9.5% in that time. Both are on track to notch their best months since November 2023. The Dow Jones gained 3% on the month. For the week, the S&P 500 advanced 1.5%, while the 30-stock Dow is up 1% and  Nasdaq went up 1.9%. The biggest ever was another great earnings report. I will write about it later.

On the economic front, the Consumer Confidence Index for May 27, 2025, rose to 98.0 from 85.7 in April. This is the highest ever increase of consumer confidence in a single month.

The Federal reserve - FOMC minutes from May 7, FOMC that showed a cautious approach due to increased economic uncertainty. Officials noted solid economic growth and labor market but highlighted rising risks of higher inflation and unemployment, partly due to tariff uncertainties. The last three months inflation has been receding but FED is still confused! I think they may cut rates in June though I am not very sure. 

The personal consumption (PCE) expenditures price index, the Federal Reserve’s key inflation measure, increased just 0.1% for the month, putting the annual inflation rate at 2.1%. The Consumer spending, slowed sharply for the month, posting just a 0.2% increase, while the savings rate surged to 4.9%, the highest in nearly a year. 

EARNIGNS
Nvidia (NVDA) released its Q1 earnings. The company did beat on the top and bottom line but not as big as earlier quarters.
  • EPS: 96 cents vs. 93 cents estimated.
  • Revenue: $44.06 billion vs. $43.31 billion estimated, up 73% YOY.
Guidance:  $45 billion vs. $45.9 billion estimated. This was little less than estimated

My View: In last three quarters Nvidia has release steller earnings but stock has not really gone anywhere. Based on the earnings call, the AI momentum has a long way to go. Nvidia is no more a chip company, it has become a complete solution provider with sophisticated hardware for data centers, software/models and networking. It's amazing to see that this company still growing above 70% revenue, that's incredible. I think this time it may move towards $160-$165 before the end of the year.

Salesforce (CRM): beat on both top and bottom line and provided slightly better profit guidance for current quarter. However, the investors are concerned with its organic growth where revenue went up mere 8%. Recently, they acquired Informatics paying $8 billion. Probably, it indicates that they are trying to acquire companies for future growth. It may remain on a trading range unless the company comes with a real good quarter. 

This week I would be looking forward to another big earnings on this Thursday from Broadcom (AVGO) which I included in my last months's blog. The stock has gone up about 20 since then.

ECONOMIC REPORT THIS WEEK
Monday, 6/2: S&P final U.S. manufacturing PMI
Wednesday, 6/4: ADP employment Report
Friday, 6/6:  NonFarm Payroll (Very Important)

Stocks to watch this week: AVGO, NVDA, TSLA, NFLX, META, TEM, IONQ, CRWV, TQQQ, SOXL. 

Future INVESTMENT MEET: Planned for Sunday, 6/8. If you are a member of my WhatsApp group, do not forget to read the process changes.

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