HOTLINE
Hotline Archive
June 18, 2026
This is John Bonnanzio with a Fidelity Monitor & Insight Hotline update for Thursday evening, June 18.
There are no model portfolio trades advised.
In a shortened week of trading (the NYSE is closed tomorrow for Juneteenth), stocks rose and oil prices fell as the U.S. and Iran agreed to cease hostilities for the next 60 days while both parties attempt to hammer out a more detailed and enduring agreement.
While it’s unclear how quickly the Strait of Hormuz will be fully reopened, Vice President Vance said on Thursday afternoon that some oil tankers had already begun leaving the contested waterway. And oil markets reacted swiftly to last Saturday’s announcement that the fighting, which began on February 28, might be over.
For the week through today’s closing, a barrel of West Texas Intermediate dropped 9.0% to $76.62 a barrel. As of this writing, oil futures were trading about 14% higher than they had been just prior to the war’s outbreak, and crude is now 32% below its $113 a barrel high set on April 7.
The other big news came yesterday from the Federal Reserve’s rate-setting committee. Voting unanimously, the FOMC decided to hold the federal funds rate unchanged in a range of 3.50% to 3.75%. But stocks still slumped on Wednesday as the central bankers raised their year-end rate projection to 3.6% - 4.1%, up from 3.25% - 3.75% as of March. (The market may also have been a bit surprised by new chairman Kevin Warsh’s suspension of forward guidance and his somewhat hawkish remarks on inflation.)
Taken together, the market now expects one rate-hike (perhaps in October) before year-end. That said, with higher energy prices the primary driver behind inflation (CPI) rising in May to a year-over-year rate of 4.2%, financials markets are also hoping the cessation of hostilities will endure.
For the week through Friday’s close, the economically sensitive Dow Jones Industrial Average advanced 0.7% and the more diversified S&P 500 gained 1.0%. As for the tech-rich Nasdaq Composite, it initially jumped 3% on Monday but wound up gaining a none-too-shabby 2.4% through the four-day period. Elsewhere, small-cap stocks continued to advance this week. The Russell 2000 rose 1.2% and is now up over 20% since the start of the year.
Overseas, London’s FTSE was fractionally lower (down 0.7%) as falling oil prices seemed a headwind for an index that skews towards energy, including heavyweights Shell and BP. More broadly, the Stoxx Europe 600 rose fractionally during the shortened period (up 0.6%), whereas Japan’s Nikkei 225 took flight. Up 7.6% through Thursday’s close, the country is heavily dependent on oil imports.
As for the dollar, in trade-weighted terms, it rose 0.8% through the past four trading sessions. While a lower dollar value of oil exports might normally have set the stage for the greenback to weaken, the Fed’s hawkish stance on rates may have given it a lift, as rate differentials often do.
As for Treasurys, shorter-term yields rose and longer-term notes and bonds saw a decline. For example, yields on the 3-month T-Bill and 2-year Note rose 13 and 10 basis points to 3.83% and 4.19%, respectively. On the other hand, yields on the benchmark 10-year Note and the 30-year Bond fell 2 and 7 basis points to 4.46% and 4.90%, respectively. (Bond yields move inversely to their price.)
| Our model performance as of Thursday's close is listed below: | ||
|---|---|---|
| Week | YTD | |
| S&P 500 | + 1.0% | + 10.2% |
| Barclays US Aggregate Bond | + 0.2% | + 0.6% |
| Income Model | + 0.2% | + 4.4% |
| G&I Model | + 0.6% | + 8.9% |
| Growth Model | + 1.6% | + 14.8% |
| Select System | + 2.6% | + 17.7% |
| Unique Opportunities Model | + 2.2% | + 13.8% |
Finally, our next regularly scheduled Hotline update is Friday June 26.
Fidelity Monitor & Insight's Hotline is updated on Friday evenings or whenever the Dow moves 1,000 points or more in either direction.