Wall Street Holds Its Breath as Rate Cuts Loom: Is This the Pivot Bulls Have Waited For?

By High Energy Trading (HET)

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June 5, 2025

New York, NY — Markets edged cautiously higher Thursday morning as Wall Street digested new labor data and continued speculation that the Federal Reserve may be approaching a long-anticipated policy pivot.

Market Overview: Hope in the Air

The S&P 500 rose 0.4% in early trading, while the Nasdaq pushed ahead by 0.6%, led by renewed momentum in tech stocks. Traders reacted to fresh jobless claims data, which showed a slight uptick in filings — a signal that the Fed’s tightening cycle may finally be easing pressure on the overheated labor market.

The benchmark 10-year yield dipped to 4.15% as bond traders priced in a 58% chance of a rate cut in July, according to CME FedWatch.

HET View: “Soft Landing or Head Fake?”

At HET, we’re watching one thing closely: whether this sentiment shift is the start of a long bull leg or a dead cat bounce in disguise. The market's internals suggest increased rotation into large-cap growth and defensives — a sign of guarded optimism, not euphoria.

Stocks in Focus

Nvidia (NVDA): Continued its streak with a 2.8% gain, buoyed by fresh AI demand from cloud hyperscalers. HET sees strong support at $1,150.

Apple (AAPL): Announced new GenAI integrations ahead of WWDC next week. Traders are positioning early.

Caterpillar (CAT): Down 1.2% amid slowing global construction signals, despite solid Q1 earnings. Watch $307 as critical support.

Strategic Notes from the HET Desk

For traders looking to navigate this macro fog:

• Options Skew: Put-call ratios remain elevated — institutions are still hedging.
• Sector Rotation: Money is flowing back into semis, software, and consumer staples.
• Energy Outlook: Crude is holding at $74–$76. Consider XLE accumulation if WTI holds above $75.

Quote of the Day

“You don’t make money on certainty. You make money on change.”
— HET Market Desk

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