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June 16, 2025 - Third Party

US PREMARKET ACTIONS 💥: June 16, 2025

Futures Indices

Dow Futures: +0.4%
S&P 500 Futures: +0.5%
Nasdaq 100 Futures: +0.6%
US 10-Year Yield: 4.45% (+4 bps)

Markets are attempting a rebound after geopolitical tensions in the Middle East, as they await the highly anticipated Fed decision on Wednesday.

Market Environment

After a Friday marked by heavy selling due to strikes between Iran and Israel, US indices are trying to recover this Monday. Weekend geopolitical developments are considered "less severe than expected" according to Deutsche Bank, with UBS seeing limited short-term risk to energy flows.

This week will be dominated by the FOMC (Fed) meeting, with a decision expected Wednesday. Markets anticipate a rate hold, but Jerome Powell's speech is expected to reflect greater caution.

"Powell will likely stress uncertainty and adopt a wait-and-see approach, especially as the recent oil surge complicates policy," comments Jim Reid (Deutsche Bank).

Why is this important?

The Fed's statements will be watched closely amid a bounce in energy-driven inflation, as hopes for rate cuts this year fade. Any hint of "higher for longer" could reignite volatility.

Stocks to Watch

Biggest Gainers

  • EchoStar (SATS) +52%: Spectacular rebound after Donald Trump intervened to resolve tensions between the FCC and the company. The risk of 5G spectrum license withdrawals had sparked bankruptcy fears.

  • Cisco Systems (CSCO) +2%: Rose after Deutsche Bank upgraded it to Buy, with a target of $73. Analysts highlight improved visibility on sustainable growth, positive AI effects, and strong positioning to absorb tariffs.

Biggest Decliners

  • Sarepta Therapeutics (SRPT) -26%: Plunged after a second patient died linked to its gene therapy for muscular dystrophy. The stock suffers amid trial suspensions and criticisms of the FDA approval process.

Recommendation Changes

Upgrades

  • Cisco Systems ($CSCO) → Deutsche Bank upgrades to Buy, target $73
  • Adobe Inc. ($ADBE) → Phillip Securities upgrades to Buy, target raised to $560
  • Celanese Corp. ($CE) → Wells Fargo upgrades to Overweight, target $66
  • Incyte Corp. ($INCY) → Stifel upgrades to Buy, target $107
  • McKesson Corp. ($MCK) → CTBC Securities upgrades to Add, target $748
  • Smurfit Westrock ($SMFKY) → Jefferies upgrades to Buy, target $55
  • Blackrock Inc. ($BLK) → BNP Paribas remains at Outperform, target raised to $1150
  • Cloudflare Inc. ($NET) → TD Cowen remains at Buy, target raised to $200
  • On Semiconductor ($ON) → Wells Fargo remains at Overweight, target raised to $60
  • Leonardo DRS Inc. ($DRS) → JP Morgan remains at Neutral, target raised to $48
  • Vertiv Holdings ($VRT) → Citigroup remains at Buy, target raised to $130

Neutral

  • Spotify ($SPOT) → DZ Bank downgrades to Sell, target $650
  • Gamestop ($GME) → Baptista Research remains at Underperform, target lowered to $13.40

Downgrades

  • Packaging Corp. of America ($PKG) → Jefferies downgrades to Hold, target lowered to $205
  • Sarepta Therapeutics ($SRPT) → Piper Sandler downgrades to Neutral, target lowered to $36

Conclusion & Key Events

To watch today:

  • Empire State Index (pre-market), expected at -5.90
  • Start of FOMC week: rate decision on Wednesday
  • Follow-up on Iran/Israel tensions

Expected volatility in:

  • Defense, Energy, Biotech sectors
  • Indices sensitive to monetary policy: Nasdaq, S&P 500

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Have a great session everyone
Sylvain Mouilhaud: Equity Coach

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