Stocks snapped a nine-day winning streak Wednesday as rising Middle East tensions sent oil surging and gave investors a reason to take profits. The S&P 500 pulled back from record territory, the Dow shed over 600 points, and after the bell, both Broadcom and CrowdStrike got punished despite beating estimates. The market was looking for an excuse to cool off, and geopolitics handed it one.
Market Snapshot
| INDEX | CLOSE | CHANGE |
|---|---|---|
| S&P 500 | 7,553.68 | -0.74% |
| Nasdaq | 26,853.98 | -0.89% |
| Dow Jones | 50,687.07 | -1.21% |
| Bitcoin | $66,950 | +0.4% |
| Ethereum | $1,884 | +1.4% |
What Moved Markets
Middle East tensions rattled the tape. Doubts about U.S.-Iran peace negotiations resurfaced after Israeli PM Netanyahu suggested another strike on Iran could be coming. That uncertainty sent WTI crude up 2.5% to $96.11 and Brent up 2% to $97.90. Higher oil means higher input costs and stickier inflation, which is not what anyone wants heading into a Fed meeting in two weeks.
Mega-cap tech took the hit. Nvidia and Microsoft both dropped more than 3%, dragging the S&P 500 and Nasdaq lower. These are the names that led the rally to records, so it makes sense they’d lead the pullback too. Meanwhile, Hewlett Packard Enterprise surged 19.5% after a blowout quarter, beating EPS estimates by nearly 50% and raising full-year guidance.
After hours, earnings beats got sold. Broadcom fell 5% despite posting $22.19 billion in revenue (up 48% year-over-year) and beating on EPS. The issue: Q3 guidance of $29.4 billion disappointed investors who wanted more. CrowdStrike dropped 9% after beating on both lines and announcing a 4-for-1 stock split. The message from the market is clear: at these valuations, “good” is not enough. You need “great.”
Marvell kept running. The chipmaker extended its rally and is now up over 50% in five days, riding the AI infrastructure wave. That kind of move demands caution, not celebration.
Worth Watching
May jobs report, Friday morning. Nonfarm payrolls drop at 8:30 a.m. ET on June 5. Consensus expects around 100,000 new jobs with unemployment holding at 4.3%. A hot number kills rate-cut hopes. A weak one sparks growth fears. Either way, it will move things.
Broadcom and CrowdStrike reaction today. Both stocks fell hard after hours despite solid results. Watch whether the selling continues in the regular session or if buyers step in at lower prices.
FOMC on deck June 16-17. The Fed is almost certainly going to hold rates at 3.50-3.75% (markets price a 97% chance), but the statement and press conference will matter more than the decision. Kevin Warsh chairs his first meeting. Every word will be parsed.
Bottom Line
One red day after nine green ones is not a trend reversal. It is a healthy reset. But the combination of stretched valuations, rising oil prices, and a jobs report on Friday means this is not the week to get aggressive. If you are holding quality positions, nothing about yesterday says you should panic. If you are thinking about adding, maybe wait until after payrolls. The market is still near all-time highs. Patience costs nothing.
