Bespoke’s Morning Lineup – 6/16/26 – Oil Drawdown Reaches 30%

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“Reality is wrong. Dreams are for the real.” – Tupac Shakur

Below is a snippet of commentary from today’s Morning Lineup. Start a two-week trial to Bespoke Premium to view the full report.  

After a strong start to the week on Monday, US futures are modestly higher this morning, with S&P 500 futures indicated 5 basis points higher, while the Nasdaq looks to gain 0.15%. Treasury yields are lower, with the 10-year yield falling below 4.45%, while crude oil falls another 3.8% to under $78 per barrel for WTI. Even Brent crude oil prices are on the verge of falling below $80, and these declines all point to lower gas prices ahead of the July 4th holiday. Gold prices are slightly higher, while Bitcoin is basically unchanged at $66,500.

Asian stocks put in a mixed performance overnight. The Nikkei barely finished higher after the BoJ hiked rates 25 bps, pushing rates to 1.0% for the first time since 1995. Chinese stocks finished lower, while India (+0.7%) and South Korea (2.1%) both finished higher. The weakness in Chinese stocks came as Retail Sales fell 0.6%, which was twice the expected decline, while Industrial Production was slightly better than expected.

European stocks are broadly higher this morning, with the STOXX 600 up 0.4%. Italy is leading the way higher with a gain of 1.2%, while Spain lags. Economic sentiment, as measured by ZEW, came in higher than expected for both Germany and the entire EU region.

It’s a quiet day for economic data this morning, as the only notable reports on the calendar were Building Permits and Housing Starts for May. Building Permits came in slightly weaker than expected at 1.413 million versus forecasts for 1.418 million. The big surprise, though, was in Housing Starts, which came in much weaker than expected at 1.177 million versus forecasts for 1.430 million. That’s the smallest monthly reading since May 2020, and one of the largest misses relative to expectations that we can remember.

Lower oil prices have been a driver of higher stock prices over the last several days, and with crude oil trading down over 2% this morning, prices are down over 30% from their recent highs, putting the current drawdown from a 52-week high near the most extreme levels since mid-2023.

Shares of SpaceX (SPCX) are up over 5% again in the premarket but were up over 10% at one point overnight. With a market cap of $2.5 trillion as of yesterday’s close, the stock briefly had a market value in excess of Microsoft (MSFT) overnight, and it’s still right around the same levels or slightly above Amazon (AMZN). Obviously, only a small percentage of the company’s shares outstanding are available for trading, so the stock is incredibly volatile for a $2.5 trillion company, but these moves for such a large company are incredible.

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