Stocks Aren't Heartbroken Over Trump-Elon Breakup

Hardika Singh

Stocks burst out of the gate to start June, building on gains from the prior month. 

The S&P added 1.5% this month and crossed the key level of 6,000, while the Nasdaq Composite gained 2.2%. Losers from earlier this year—semiconductor stocks—were responsible for the latest advance. Other than the usual stars like Nvidia and Advanced Micro Devices, another chip company re-joined the ranks: Broadcom, whose shares increased 2%. 

The broad-based index is up 2% this year and off just 2.3% from all-time highs, even as many investors argue that the rally has no legs because there’s been little-to-no tariffs resolution and worries about a ballooning U.S. budget deficit haven’t gone away. Despite that, stocks are mounting a rebound.

The ADP jobs report on Wednesday, which focuses on private-sector job creation, hit its lowest level in May in more than two years, prompting calls from President Donald Trump to lower interest rates. 

“I don’t think that’s entirely bad news because if we have a weak employment report, I do think it sets the stage for the Fed to be more dovish,” Head of Research Tom Lee said. 

The jobs report Friday showed a different picture, showing that the U.S. economy added 139,000 jobs in May, above the 125,000 expected by economists but below the revised April jobs number of 147,000. Stocks rallied sharply in response, but Treasury yields shot up. 

The headlines this week were dominated by Tesla Chief Executive and former DOGE lead Elon Musk, who called Trump’s One Big Beautiful Bill a “disgusting abomination,” setting off a public spat between the two former friends. 

In response, Trump said, “I don’t know if we will have a great relationship with Elon anymore.”

Head of Technical Strategy Newton expects that the S&P 500 will make a run for 6,100-6,140.

“Momentum is really starting to cross over, so even if we stall here and have some churning, my expectation is still for an eventual push up into the month of August,” he said. “The next couple of months are going to be very, very good.”

He noted the recent rally in small-cap stocks, which have gained 21% since the April 8 low, slightly outperforming the S&P 500’s 20% gain. 

Sector Allocation Strategy

These are the latest strategic sector ratings from Head of Research Tom Lee and Head of Technical Strategy Mark Newton – part of the June 2025 update to the FSI Sector Allocation Strategy. FS Insight Macro and Pro subscribers can click here for ETF recommendations, precise guidance on strategic and tactical weightings, detailed commentary, and methodology.

Stocks Aren't Heartbroken Over Trump-Elon Breakup
Stocks Aren't Heartbroken Over Trump-Elon Breakup

Chart of the Week

Stocks Aren't Heartbroken Over Trump-Elon Breakup

Fundstrat Head of Research Tom Lee says that, to him, the current rally resembles an early bull market. He expects the gains to continue, partly because the Institute for Supply Management’s purchasing managers’ index of manufacturing activity (PMI) has come in below 50, indicating a contractionary economy, for many months. The latest release showed the index fell to 48.5 in May from 48.7 in April. “I don’t think the S&P 500 has peaked until the ISM has moved above 50,” Lee said during his Macro Minute videos. “Conditions remain in place for what would be a face ripper, especially as we cross to all-time highs.”

Recent ⚡ FlashInsights
Important to note that TSLA 4.13%  decline is now nearing its 38.2% area of the entire rally off the April lows after a few severe days of selling in early June. This Elliott pattern seems to be nearing conclusion and might provide a bottom between 307-315 now on this weakness. The upcoming Robotaxi rollout in Austin is scheduled for next week and technically, despite this rapid unraveling in the stock in recent days, TSLA remains higher by more than 45% in the last 8 weeks. I don’t see this pullback as being a big deal technically, and expect a rally to begin following some stabilization in the days to come. We’ll see if the stock can stabilize here, but it looks close technically and the wave structure along with Fibonacci retracements speak to this possibly bottoming while intermediate-term momentum remains quite positive.
Flash Insight attachment
Jun 5 · 12:52 PM
Trump/Xi call seemed to go well. Trump said: “resulted in a very positive conclusion for both countries”. Xi invited the President and Mrs. Trump to China and in the coming weeks the two nations will have talks. White House says Bessent and Lutnick will lead US delegation.
Jun 5 · 5:07 PM
Snapback in US Equities along with Cryptocurrencies higher given a potential thaw in the Musk/Trump battle and evidence of a reassuring Jobs picture has caused S&P to push back above 6000 ever so slightly. Hourly charts show this to be the likely “final” push up of the short-term rally from late May lows which is expected to also a potential “final” push up for S&P from early April. As can be seen, potential Elliott-based alternate extension targets point to 6065-6077 which should be important if reached between now and early next week as resistance. Overall, as discussed, while i remain quite bullish between now and August i suspect that markets will need to consolidate gains which might start sometime next week, but should be complete by 6/23
Flash Insight attachment
Jun 6 · 12:00 PM

FS Insight Video: Weekly Highlight

Stocks Aren't Heartbroken Over Trump-Elon Breakup

Key incoming data

  • 6/2 9:45 AM ET: May F S&P Global Manufacturing PMI Tame
  • 6/2 10:00 AM ET: May ISM Manufacturing PMI Tame
  • 6/3 10:00 AM ET: Apr JOLTS Job Openings Tame
  • 6/3 10:00 AM ET: Apr F Durable Goods Orders MoM Tame
  • 6/4 9:45 AM ET: May F S&P Global Services PMI Tame
  • 6/4 10:00 AM ET: May ISM Services PMI Tame
  • 6/4 2:00 PM ET: Jan Fed Releases Beige Book Mixed
  • 6/5 8:30 AM ET: 1Q F Unit Labor Costs Tame
  • 6/5 8:30 AM ET: 1Q F Nonfarm Productivity QoQ Tame
  • 6/5 8:30 AM ET: Apr Trade Balance Tame
  • 6/6 8:30 AM ET: May Non-farm Payrolls Tame
  • 6/6 9:00 AM ET: May F Manheim Used Vehicle Index Tame
  • 6/9 11:00 AM ET: May NYFed 1yr Inf Exp
  • 6/10 6:00 AM ET: May Small Business Optimism Survey
  • 6/11 8:30 AM ET: May Core CPI MoM
  • 6/12 8:30 AM ET: May Core PPI MoM
  • 6/13 10:00 AM ET: Jun P U. Mich. 1yr Inf Exp
  • 6/16 8:30 AM ET: Jun Empire Manufacturing Survey
  • 6/17 8:30 AM ET: May Retail Sales
  • 6/17 10:00 AM ET: Jun NAHB Housing Market Index
  • 6/18 9:00 AM ET: Jun M Manheim Used Vehicle Index
  • 6/18 2:00 PM ET: Jun FOMC Decision
  • 6/18 4:00 PM ET: Apr Net TIC Flows
  • 6/20 8:30 AM ET: Jun Philly Fed Business Outlook
  • 6/23 9:45 AM ET: Jun P S&P Global Services PMI
  • 6/23 9:45 AM ET: Jun P S&P Global Manufacturing PMI
  • 6/23 10:00 AM ET: May Existing Home Sales
  • 6/24 9:00 AM ET: Apr S&P CS home price 20-City MoM
  • 6/24 10:00 AM ET: Jun Conference Board Consumer Confidence
  • 6/24 10:00 AM ET: Jun Richmond Fed Manufacturing Survey
  • 6/25 10:00 AM ET: May New Home Sales
  • 6/26 8:30 AM ET: May P Durable Goods Orders MoM
  • 6/26 8:30 AM ET: May Chicago Fed Nat Activity Index
  • 6/26 8:30 AM ET: 1Q T GDP QoQ
  • 6/26 11:00 AM ET: Jun Kansas City Fed Manufacturing Survey
  • 6/27 8:30 AM ET: May Core PCE MoM
  • 6/27 10:00 AM ET: Jun F U. Mich. 1yr Inf Exp
Stocks Aren't Heartbroken Over Trump-Elon Breakup

Stock List Performance

Stocks Aren't Heartbroken Over Trump-Elon Breakup
Stocks Aren't Heartbroken Over Trump-Elon Breakup

In the News

Budget deficit is real threat long-term

Budget deficit is real threat long-term
logo image
There's not much signal in Moody's U.S. downgrade

There's not much signal in Moody's U.S. downgrade
logo image
Sean Farrell on Timing Crypto's next break out

Sean Farrell on Timing Crypto's next break out
More News Appearances

More from the author

Hardika Singh
Share
Disclosures (show)

Trending

Trending tickers in our research

Get invaluable analysis of the market and stocks. Cancel at any time. Start Free Trial

Articles Read 2/2

🎁 Unlock 1 extra article by joining our Community!

You are reading the last free article for this month.

By continuing, you agree to the Terms of Service and Privacy Policy.

Already have an account? Sign In