June 20th, 2025
U.S. stocks mostly drifted lower on Friday as investors weighed a range of developments on several fronts. The Dow Jones Industrial Average hovered near the flatline, while the S&P 500 gave up earlier gains to slip 0.3%. The Nasdaq Composite dominated by tech stocks, dropped 0.7%.
Economic Takeaways:
- The Federal Reserve held interest rates steady on Wednesday and maintained its projection for two rate cuts later this year. The Fed still sees the federal funds rate ending the year at 3.9%, unchanged from the March projection.
- President Trump said he’ll decide within two weeks whether to enter the Middle East conflict.
- Fed Governor Christopher Waller told CNBC the Fed should consider lowering rates as soon as July. “I think we’re in the position that we could do this, and as early as July,” Waller said, according to CNBC, referring to a rate cut.
- Bitcoin (/BTC) advanced 2.1% in early action, rebounding as geopolitical tensions eased slightly following President Trump’s decision to give negotiations with Iran more time. The crypto market had dipped earlier in the week.
- Oil was on track to close out its third week of gains. West Texas Intermediate futures traded just below $75 per barrel, and Brent crude, the international benchmark, hovered near $76. Citi on Friday said its researchers “see a lower risk of material energy flow disruptions from the conflict.”
$6.5 Trillion ‘Triple Witching’ Could Stir Stock Market Volatility
According to Bloomberg, roughly $6.5 trillion in notional U.S. options are set to expire Friday, potentially setting the stage for increased market swings after a relatively calm stretch.
This quarterly event, known as “triple witching,” occurs when stock index futures, stock index options, and stock options all expire on the same day. While it isn’t expected to spark immediate volatility on Friday, it could pave the way for sharper market moves in the coming week.
Since early May, U.S. stocks have experienced limited day-to-day movement, partially due to the “pinning” effect of widespread bearish options positions placed earlier this year—when a rebound in the S&P 500 (^GSPC) to near-record levels seemed unlikely. “Pinning” refers to the tendency of a stock or index to gravitate toward the strike price of heavily traded options as expiration approaches, explains Rocky Fishman, founder of research firm Asym 500 LLC.
Pop Mart Shares Drop as China Signals Tighter Rules on Blind-Box Toys like Labubu
Pop Mart (9992.HK, PMRTY) shares fell in Hong Kong after Chinese state media called for stricter oversight of blind-box toys and trading cards, sparking investor concerns about the company’s outlook.
The Beijing-based toy maker, known for its wildly popular Labubu elf dolls, has seen its market capitalization soar to nearly $40 billion—double that of Hasbro (HAS) and Mattel (MAT) combined. But the recent commentary in the People’s Daily, the official newspaper of the Chinese Communist Party, has cast a shadow.
Though Pop Mart wasn’t mentioned directly, the article cited legal experts urging tighter regulation of “blind cards” and “mystery boxes,” warning that some models may encourage excessive spending by minors. Pop Mart’s signature blind-box approach keeps customers guessing which character they’ll get until the package is opened.
Bloomberg reports the news rattled traders who have driven Pop Mart’s stock up nearly 170% this year amid a frenzy for its distinctive monster figures.
“The commentary has weighed on investor sentiment, flashing some overheating signs in its business,” said Steven Leung, executive director at UOB Kay Hian Hong Kong Ltd. “Still, it’s a mild reminder as it didn’t come directly from a government official.”Top of FormBottom of Form
On the Move
- Darden Restaurants (DRI) gained 2.7% in pre-market trading after narrowly topping Wall Street’s earnings and revenue expectations and announcing a dividend increase.
- Accenture (ACN) slipped 5% before the bell, despite beating consensus estimates for earnings and revenue and raising its guidance. Investor sentiment appeared weighed down by concerns over underlying business trends.
- CarMax (KMX) surged 9.6% ahead of the open as strong demand for used vehicles drove earnings and revenue above analyst forecasts.
- Tesla (TSLA) rose nearly 2% in early trading, with investors eyeing its tentative plan to launch robotaxis in Austin this Sunday.
- Coinbase (COIN) climbed 3%, while Circle Internet Group (CRCL) jumped 14% in early trading, adding to Wednesday’s respective 16% and 33% gains. The surge followed Senate approval of a bill to regulate stablecoins. A House vote is still needed, with key differences between versions yet to be resolved, though Reuters reports a vote could come by late summer.
- Kroger (KR) shares were mostly flat early Friday after the company raised its full-year sales forecast, maintained its profit guidance, and reported mixed results for the latest quarter.
- Wolfspeed’s (WOLF) stock fell 4% premarket after reports emerged on Thursday it would be taken over by creditors inculding Apollo Global Management.
- GMS (GMS) shares jumped 23% following a Wall Street Journal report that Home Depot (HD) has made an offer to acquire the building-products distributor, according to sources familiar with the situation. The report did not disclose a proposed purchase price.
- IBM (IBM) edged down nearly 1% after three consecutive sessions of record closes. Wednesday’s rally was fueled by a Bank of America (BAC) price target hike, driven by optimism over AI and quantum computing growth potential.
- Semiconductor stocks fell on Friday following a Wall Street Journal report that a senior U.S. official informed leading global chipmakers of plans to revoke waivers that currently allow them to use American technology in China. Applied Materials (AMAT) and Lam Research (LRCX) both fell roughly 4%. Taiwan Semiconductor Manufacturing Company (TSM) and Broadcom (AVGO) also declined.
- Circle (CRCL) kept moving higher. The stablecoin issuer soared as much as 15% in early trading on Friday. “Circle as a top-tier crypto ‘disruptor’ with a sizeable future opportunity,” Seaport Research Partners analyst Jeff Cantwell wrote on Friday.
What’s Ahead
Returning from a rare Thursday off, investors can look forward to earnings today from Kroger (KR), Accenture (ACN), and Darden Restaurants (DRI).
KB Home (KBH) reports this coming Monday which could give more indication on how the housing market is doing. These earnings come amid fresh signs of weakness as U.S. May housing starts fell to a new cycle low of 1.256 million on a seasonally adjusted annual basis and building permits dropped to 1.393 million.
Tuesday’s June consumer confidence report from the Conference Board and Friday’s final June consumer sentiment data from the University of Michigan are two important economic reports to look forward to.
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