Apple kicks off its annual developer conference on Monday with the stock down in the dumps.Adnan Abidi/Reuters
The public breakup between U.S. President Donald Trump and Elon Musk could probably fill a whole Taylor Swift album. She just bought back her masters, but maybe she should have waited for the rights to this situationship that we didn’t ask for but can’t stop watching.
Here are five things to watch this week:
Wrapping the week: The TSX and the S&P 500 finished the first trading week of June in the green despite a slew of negative headlines. Was there higher oil production from OPEC+? Sure, but oil gained 6 per cent, which is its biggest weekly increase since November.
What about even more tariff increases on steel and aluminum? The S&P 500 is 2 per cent from an all-time high. Speaking of all-time highs, the TSX hit three of them last week. It is being called an “unloved” rally by some in the markets.
And when you look at the source of the outperformance, it is not the risk-off sectors. Semiconductors are leading south of the border, while industrials hit a fresh all-time high. In Canada, gold has handed off top performance to financials, which hit all-time highs. Even energy stocks perked up.
Josh Young of Bison Interests said OPEC+ increasing production isn’t a problem right now because they are “paper barrels” rather than actual exports.
“There have been about 30 oil cycles since oil became a commercial commodity in the last 150 years. This time is likely not different. The cure for low prices is low prices, and we’re firmly in that low-price scenario,” he said on my podcast, In the Money with Amber Kanwar.
The Texas-based investor has been buying Canadian energy stocks. Proving that there is money to be made in unloved markets: what’s not to love about that?
U.S. inflation: Mr. Trump took to social media once again to lambaste Federal Reserve Chair Jerome Powell for not cutting interest rates.
“Despite him our Country is doing great. Go for a full point, Rocket Fuel!” the U.S. President posted, referring to Mr. Powell, who has been inclined to keep rates on hold because inflation hasn’t been forcing his hand, while tariffs could create upward pressure.
We will get a fresh read of inflation on Wednesday with consumer price index data that will capture the effect of tariffs on goods such as furniture, cars and clothes. Economists expect that headline inflation grew by 2.5 per cent year-over-year from 2.3 per cent, and that core inflation rose to 2.9 per cent from 2.8 per cent. If the core number comes as expected, that would mark the first pick-up in inflation since September, 2024.
But there could be room for a downside surprise. A decline in services inflation could keep the headline in check, according to TD’s global rates team. Headline inflation could also be restrained by lower gas prices.
Apple’s Worldwide Developer Conference: Apple AAPL-Q kicks off its annual developer conference on Monday with the stock down in the dumps. The company is down 18 per cent going into the conference and historically doesn’t do well during this time.
“WWDC lasts around four days (Monday through Thursday), and in that span, AAPL’s stock price has usually fallen despite any hype for new products. On average, AAPL has declined a little more than 1 per cent during WWDC, with positive returns less than 40 per cent of the time,” Bespoke Investment Group wrote in a note to clients.
But last year the company bucked the trend, soaring nearly 8 per cent because of announcements in AI. However, the stock is barely up from the last conference, owing to a lack of progress with Apple Intelligence. The company has been shockingly slow in rolling out mainstream products, while the revamp of Siri has been indefinitely delayed.
Apple’s “AI strategy has faced many challenges since the launch of Apple Intelligence,” Dan Ives of Wedbush wrote in a note to clients. Still, he remains optimistic the company will get its act together: “We estimate roughly 25 per cent of the world’s population will eventually access AI through an Apple device over the next few years.”
Oracle earnings: Shares of Oracle ORCL-N are due to report earnings on Wednesday after the close and are riding high into the print. Sales are expected to grow a respectable 9 per cent, which would be the fastest pace of growth since the fourth quarter of 2023.
However, all eyes will be on the company’s cloud infrastructure business, which represents less revenue but grew 50 per cent last quarter on the build-out of AI infrastructure. Investors will be looking for clues that they are benefitting from the AI spend.
Adobe preview: Adobe ADBE-Q is coming into earnings with a slightly different profile from Oracle. Its shares have been drifting higher since April, but are down 9 per cent over the past year, as investors fret about whether they are disruptor or disrupted when it comes to AI. RBC acknowledges the stock has been in the penalty box.
“We would expect solid headline numbers in Q2, but guidance and the strategic outlook will remain the key to shifting the narrative around investor sentiment,” wrote RBC Capital Markets’ Matthew Swanson in a note to clients.
In the Money with Amber Kanwar brings you actionable insights from top portfolio managers to help you make profitable investing decisions. New shows out Tuesday and Thursday mornings. Catch them all at www.inthemoneypod.com