HOTLINE
Hotline Archive
June 5, 2026
This is Jack Bowers with a Fidelity Monitor & Insight Hotline update for Friday evening, June 5.
There are no model portfolio trades advised.
U.S. equity markets were volatile this week, with semiconductor stocks and other AI infrastructure plays topping out on Wednesday then coming under heavy selling pressure on Thursday and Friday. Profit-taking on Friday was especially intense against the backdrop of an unexpectedly strong jobs report (more on this later) which increased the odds of a tightening move by the Fed later this year.
Some of Friday’s selloff can be attributed to liquidation activity ahead of the SpaceX IPO. With the price potentially set at $135 per share and the issuance at 555,555,555 shares, it will be a mammoth capital raise of $75 billion. This necessitates the sale of other securities (primarily growth stocks).
As I pointed out in the June newsletter, Blue Chip Growth, Contrafund, New Millennium and OTC have 3-5% stakes in SpaceX that go back to 2015 when they acquired private placement shares. If you want “participate” in the IPO, those funds are probably your best bet (Fidelity has waived the $500k account requirement for retail investor IPO participation, but given the allocation process you may not get to buy as many shares as you request).
For the week through Friday’s close, the tech-rich Nasdaq Composite fell 4.7% and the S&P 500 retreated 2.5%. The more economically sensitive Dow Jones Industrials slipped 0.3%, though it did not completely sidestep the market’s volatility (on Wednesday the blue-chip gauge dropped 621 points, or 1.2%). As for small- and mid-cap Russell indexes, the 2000 dropped 2.9% over the five-day trading period versus a setback of 1.1% for midcaps.
Fractional losses and gains were typical throughout European and Japanese equity markets this week, though the emerging markets experienced a significant divergence in performance. Brazil’s Bovespa sank 2.7% whereas Morgan Stanley’s dollar-denominated emerging market barometer gained 2.0% for the week. Some of the divergence was driven by changes in U.S. tariff policy, which played a role in Brazil’s real tumbling some 5% versus the dollar.
Separately, a barrel of West Texas Intermediate (WTI) crude futures rose 2.7% to $90.05 a barrel, as a peace deal is looking less likely short-term.
Turning to bonds, yields moved higher this week, which weighed on bond fund prices. Most of the impact occurred on Friday with the release of the government’s nonfarm payroll report (the nation’s official unemployment rate held at 4.3%, but job growth came in at a robust 172,000 – well above expectations). While that’s good economic news, fixed-income markets saw it increasing the odds of a rate hike (or two) later this year (the combination of elevated oil prices and strong job numbers threatens to keep inflation higher for longer). With the yield on the 30-year long bond back above 5.00%, the benchmark 10-year Treasury Note jumped 8 basis points on Friday (for a total of 10 bps for the week) to end the week at 4.55%.
| Our model performance as of Friday's close is listed below: | ||
|---|---|---|
| Week | YTD | |
| S&P 500 | - 2.5% | + 8.4% |
| Barclays US Aggregate Bond | - 0.5% | 0.0% |
| Income Model | - 1.0% | + 3.4% |
| G&I Model | - 0.9% | + 6.9% |
| Growth Model | - 1.6% | + 11.2% |
| Select System | - 2.4% | + 12.9% |
| Unique Opportunities Model | - 2.0% | + 9.7% |
The June newsletter was posted on our website Monday evening June 1 and was mailed on Wednesday.
If your subscription is up for renewal (i.e. you get a renewal notice along with the mailed issue), and you plan to use a credit or debit card, please do so before June 20th. After that we can only accept checks for payment. My apologies for any inconvenience; between fees and web site security demands it’s just too costly to be worth the trouble for six more months.
Finally, our next regularly scheduled Hotline update is Friday June 12.
Fidelity Monitor & Insight's Hotline is updated on Friday evenings or whenever the Dow moves 1,000 points or more in either direction.