Morning Market Review June 11 2025

1

U.S. and China reach trade agreement

On Tuesday evening, representatives from the U.S. and China said they reached an agreement following 2 days of negotiations in London. U.S. Commerce Secretary Howard Lutnick said both sides “have reached a framework to implement the Geneva consensus and a call between the two presidents”. Representatives will now return to their respective countries to get Trump and Xi’s approval before implementation.

2

General Motors announces U.S. manufacturing investment

GM announced Tuesday they will invest $4 billion in three U.S. plants where it plans to add assembly of some of its Mexican-produced vehicles. GM CEO Mary Barra believes the future of transportation is going to be driven by American innovation and manufacturing expertise and this investment demonstrates GM’s ongoing commitment to build vehicles in the U.S. and support American jobs. GM stock was mostly unchanged going into market open today rising about 0.75% in pre-market trading.

3

Inflation/CPI report

Consumer prices picked up in May with CPI rising 2.4%, below estimates of 2.5% and core CPI rising 2.8% below estimates of 2.9%. Futures tied to major indices reversed directions in pre-market trading and started rising after the report came out this morning. A recent survey by the New York Fed found that consumers expect lower inflation over the next year than they did last month, following the Trump administrations pullback from the steepest tariffs it enacted in April. The Organization for Economic Cooperation and Development also recently cut its outlook for U.S. gross domestic product growth from 2.2% to 1.6%.

4

Google offers buyout to employees

Google offered buyouts to employees across several divisions on Tuesday and is the company’s latest effort to reduce headcount. Google executive Nick Fox who recently took over the knowledge and information (K&I) department sent a memo to employees saying the buyout offers a supportive exit path for those employees who don’t feel energized by work or are having difficulty meeting expectations. These buyouts come after Google CFO said one of her top priorities in 2025 is cost cutting as the company rapidly expands its spending on AI infrastructure.

5

Notable earnings

Chewy – reported earnings this morning with Q1 revenue rising 8.3% YoY to $3.12 billion and adjusted EPS of $0.35 topped the $0.34 estimate. CHWY stock was driven down this morning, falling nearly 12% shortly after market open

Victorias Secret – reported earnings this morning with Q1 net sales at $1.353 billion (flat YoY) and adjusted EPS of $0.09, in line with expectations. VSCO stock was making large swings pre-market but came out fairly flat at market open.

GameStop – reported earnings yesterday after market close with sales falling 17% YoY to $732.4 million, however adjusted EPS came in at $0.17 significantly beating the estimates of $0.04. GME stock was down about 4% into market open today.