June 21, 2025
Key Takeaways
• Major indexes show mixed performance amid geopolitical and policy uncertainty
• Federal Reserve signals divide markets with conflicting rate cut messages
• Semiconductor stocks face pressure as U.S. weighs China export restrictions
• Circle soars 500%+ since IPO as crypto legislation advances
• Middle East tensions and tariff policies create market headwinds
Market Performance: Divergent Paths for Major Indexes
U.S. equities closed Friday with mixed results, continuing a pattern of cautious trading amid elevated uncertainties. The S&P 500 declined 0.22% to 5,967.84, marking its third consecutive losing session and a 0.2% weekly drop. The tech-heavy Nasdaq Composite fell 0.51% to 19,447.41, pressured by semiconductor stocks, while the Dow Jones Industrial Average edged up 35.16 points (0.08%) to 42,206.82, buoyed by less tech-centric components 1411. Despite recent pullbacks, the S&P 500 remains remarkably resilient – up 2.11% for the month and 9.21% year-over-year – trading just 3% below its February 2025 all-time high of 6,152.87 11. This sideways movement reflects what CFRA’s Sam Stovall describes as “rusty doors” at prior highs that “require several attempts before finally swinging open” 1.
Table: Key Index Performance (June 20, 2025)
| Index | Level | Daily Change | Weekly Change |
| S&P 500 | 5,967.84 | -0.22% | -0.2% |
| Dow Jones | 42,206.82 | +0.08% | +0.02% |
| Nasdaq Composite | 19,447.41 | -0.51% | +0.2% |
| Russell 2000 | 2,109.27 | -0.17% | N/A |
Federal Reserve Policy: The Great Disconnect
The central bank’s messaging has created palpable tension in markets. Federal Reserve Governor Christopher Waller ignited brief optimism Friday morning, suggesting the Fed could cut rates “as early as July” during a CNBC Squawk Box interview, arguing recent inflation data justified easing despite tariff implementation 14. This contradicted Fed Chair Jerome Powell’s cautious stance from Wednesday, where he emphasized the Fed was “in no hurry to cut” and would remain “data dependent,” particularly given uncertainty around Trump’s tariff impacts 13. Powell notably used variations of “uncertain” nearly 20 times during his press conference, underscoring the fog clouding policy decisions 3.
This policy disconnect manifests in rate expectations: While Waller floated July, traders currently price just a 14.5% chance of a July cut, with September remaining the consensus expectation for the first reduction 410. The Schwab Mid-Year Outlook anticipates “one or two cuts in the second half of 2025,” bringing the upper bound of the target range to approximately 4% 7. Treasury yields reflected this tug-of-war, with the 2-year yield falling four basis points to 3.91%, while the 10-year yield dipped slightly to 4.37% 1011.
Sector Spotlight: Semiconductors Under Pressure
Chip stocks faced notable selling pressure after The Wall Street Journal reported the U.S. may revoke technology waivers allowing certain semiconductor manufacturers to access American technology in China. Industry heavyweight Nvidia fell over 1%, while Taiwan Semiconductor Manufacturing slid nearly 2%, dragging the VanEck Semiconductor ETF (SMH) down approximately 1% 111. This development threatens to disrupt carefully calibrated global supply chains and comes amid broader tariff uncertainty that has averaged effective U.S. rates above 15% – the highest level since the 1930s Great Depression 7.
Contrasting this weakness, Circle Internet Group skyrocketed 18%, continuing its astonishing 500%+ rally since its June 5 IPO. The Senate’s passage of the GENIUS Act – landmark stablecoin legislation now headed to the House – ignited this frenzy. The bill enables broader use of dollar-pegged cryptocurrencies by banks, fintech firms, and retailers, directly benefiting Circle, issuer of the USDC stablecoin 114. Coinbase shares gained 3%, leveraging revenue-sharing from Circle’s reserves and platform-held USDC 1.
Geopolitical Tensions: The Middle East Powder Keg
President Trump introduced a critical variable by announcing he would decide within two weeks whether to authorize direct U.S. military involvement in Israel’s conflict with Iran. This followed Israeli Prime Minister Benjamin Netanyahu’s reported orders to strike “strategic targets” and “government targets” in Iran 1412. The White House statement Thursday emphasized Trump would make a “final decision within the next two weeks,” opening a window for European-led diplomacy that so far has yielded little progress 413.
These developments triggered volatile oil trading, with Brent crude falling 2.5% to $77.20 on hopes for negotiated solutions, though prices remained on track for a third weekly gain 412. Energy Today’s Stock Market remain hypersensitive as Iran controls critical chokepoints like the Strait of Hormuz, through which approximately 20% of global oil shipments pass. Annex Wealth Management’s Brian Jacobsen captured the prevailing mood: “We’re all waiting on pins and needles… The best way to manage that stress is to just ride through it and not try to trade it” 13.
Notable Movers: Earnings & M&A Frenzy
Several companies made significant moves on corporate developments:
- Kroger surged 9.8% after topping quarterly profit estimates and raising full-year identical sales guidance, showcasing resilience despite consumer spending concerns 1213.
- CarMax jumped 6.4% as the used-auto retailer beat earnings expectations with a 9% year-over-year increase in retail vehicle sales 413.
- GMS soared 28% amid a reported bidding war between Brad Jacobs’ QXO and Home Depot for the building products distributor, highlighting strategic positioning in fragmented industries 114.
- Darden Restaurants hit all-time highs following strong earnings and a new $1 billion buyback authorization, with Olive Garden same-store sales climbing 6.9% 112.
Conversely, Accenture tumbled 6.9% after quarterly bookings of $19.7 billion missed Visible Alpha’s $21.5 billion consensus, signaling corporate spending caution amid economic uncertainty. CEO Julie Sweet noted companies are “holding off on hiring consultants” in this environment 1214. Smith & Wesson plunged 19.5% as CFO Deana McPherson cited “persistent inflation, high interest rates, and uncertainty caused by tariff concerns” hurting firearm demand 1213.
Table: Key Economic Data & Upcoming Catalysts
| Indicator | Current Level | Trend/Implication | Next Catalyst |
| Avg. U.S. Tariff Rate | >15% | Highest since 1930s | Trade deal negotiations |
| 10-Year Treasury Yield | 4.37% | Down 1 bp Friday | PCE inflation data (6/27) |
| Continuing Jobless Claims | Cycle high | Labor market cooling | June jobs report (7/3) |
| Oil Prices (Brent) | $77.20/barrel | -2.5% Friday | Trump Iran decision (by 7/3) |
Looking Ahead: Navigating the Fog
The market faces multiple near-term catalysts that could determine its trajectory:
- Federal Reserve Guidance: Powell testifies before Congress June 24-25, followed by Friday’s critical PCE inflation reading – the Fed’s preferred gauge 10.
- Geopolitical Decisions: Trump’s two-week deadline for Iran action expires around July 4, with potential market turbulence regardless of outcome 413.
- Corporate Confidence: Earnings season approaches amid widespread corporate withdrawal of financial forecasts due to tariff uncertainty 13.
Schwab’s analysis recommends “diversification across and within asset classes” and appropriate international exposure, noting that U.S. Today’s Stock Market have underperformed global counterparts this year. International diversification proves particularly valuable when “unpredictable and uncertain policy moves” dominate domestic markets 7.
As the second half unfolds, investors must balance stretched valuations against supportive earnings growth and resilient consumer spending. The path forward remains obscured by what Powell might call exceptional uncertainty – a fog only liftable by concrete data, policy clarity, or geopolitical resolution. Until then, markets seem likely to continue testing those “rusty doors” of resistance, requiring patience and strategic positioning from investors navigating these crosscurrents.
Frequently Asked Questions
Q: Why did semiconductor stocks decline today?
A: Chip stocks like Nvidia and TSMC fell after reports that the U.S. may revoke waivers allowing certain semiconductor manufacturers to access American technology in China. This threatens global supply chains and prompted a nearly 1% drop in the VanEck Semiconductor ETF (SMH) 111.
Q: What’s driving Circle’s massive stock surge?
A: Circle has skyrocketed over 500% since its June 5 IPO, fueled by Senate passage of the GENIUS Act, which establishes regulatory clarity for stablecoins and enables broader adoption by financial institutions. The stock gained another 18% Friday 114.
Q: How are tariffs impacting the market?
A: The average effective U.S. tariff rate exceeds 15% – the highest since the 1930s – creating uncertainty that has caused many companies to withdraw financial forecasts. The Fed cites tariffs as a key reason for maintaining its “data dependent” stance on rate cuts 713.
Q: What happened with oil prices today?
A: Brent crude fell 2.5% to $77.20/barrel after President Trump announced a two-week decision window on potential U.S. military action against Iran, raising hopes for diplomatic solutions. Prices remain poised for a third weekly gain amid supply concerns 412.
Q: Which stocks hit all-time highs today?
A: Thirteen S&P 500 components reached 52-week highs, with nine setting all-time records including Microsoft (post-1986 IPO), Take-Two Interactive (post-1997 IPO), Darden Restaurants (post-1995 IPO), and Jabil (post-1993 IPO) 1.
