Early-week liquidation fears evaporated as a historic $2.2T SpaceX debut, a soft Core CPI print, and a geopolitical pivot ignited a massive equity squeeze led by the Russell 2000.

What a difference a week makes. Markets started the week under distinct structural pressure as a wave of pre-IPO liquidations swept through the equity space. Investors were actively dumping existing holdings to raise dry powder for one of the most anticipated market events in modern financial history: the SpaceX IPO.

However, the early-week caution dissolved into an aggressive risk-on catch-up trade. A cooler-than-expected CPI print, a major geopolitical de-escalation signal out of the Middle East, and an absolute blockbuster first day of trading for SpaceX completely shifted the market’s momentum, driving small caps and lagging international indices to fresh milestones.

Macro Catalysts: Cool CPI and Geopolitical Relief

The macro data delivered a massive tailwind to risk assets midway through the week.

Core CPI Trends Lower

The headline Consumer Price Index (CPI) numbers dropped cooler than consensus estimates across the board, providing much-needed breathing room for asset valuations:

As illustrated in the long-term trend chart below, Core CPI YoY has established a definitive downward trajectory since its secular peak near 7% in 2022, sliding back below the 3% threshold but still above the 2% Fed’s Target.

The Trump-Iran Pivot

Further risk-on fuel arrived via geopolitical channels on Thursday. Comments from Donald Trump downplayed immediate military escalations with Iran, noting that “no attack will be happening and a deal will be signed soon.” This sudden pivot instantly removed a significant geopolitical risk premium from the market, prompting a sharp collapse in energy prices and a broad-based squeeze into equities.

The SpaceX Phenomenon Shakes Up Wall Street

Friday’s session belonged entirely to Elon Musk’s aerospace giant. The historic SpaceX IPO drew a staggering $350 billion in total demand from institutional and retail backers, with retail alone accounting for over $100 billion of the order book.

The market reception was nothing short of legendary:

• Market Capitalization: SpaceX finished its inaugural session valued at a jaw-dropping $2.2 trillion, instantly cementing it as one of the most valuable public entities on earth.
• Intraday Performance: Offered at $135 per share, the stock surged as much as 31% before closing its first day with a stellar +19% return for IPO allocation buyers.

The gravity of this single event cannot be overstated—the capital raising process dictated early-week liquidations, but the massive success of the debut unleashed a wave of celebratory buying across the entire tech ecosystem.

Asset Class & Factor Rotation Performance

Broad Market Performance Overview

The macro and corporate catalysts triggered a clear thematic shift across global asset classes:

• The Small-Cap Catch-Up: The Russell 2000 stole the show, outperforming large caps with a strong +3.9% weekly gain.
• Global Equity Liftoff: Non-U.S. indices enjoyed strong tailwinds, with the Euro Stoxx 50 advancing +2.1% and the S&P/ASX 200 gaining +2.1%. Conversely, Japan’s Nikkei 225 bucked the trend, sliding -0.9% on the week.
• Commodities Flush: Following the Iranian diplomatic relief, WTI Crude Oil plummeted -6.3%, while Gold gave back some recent premium to close down -1.5%.
• Crypto Rebounds: Digital assets caught a massive bid alongside risk factors, with Bitcoin (BTC) surging +2.9% and Ethereum (ETH) leading the charge up +3.8%.

Industry Disruption and S&P 500 Valuations

Under the hood of the sector data, Semiconductors reclaimed their throne as the single best-performing industry of the week. However, the market showed clear discrimination elsewhere: software and digital agencies perceived to be under direct operational threat from rapid AI integration lagged dramatically. For instance, Adobe (ADBE) suffered severe institutional selling on Friday, closing very weak following its quarterly earnings release.

From a fundamental standpoint, the S&P 500 currently trades at a forward 12-month P/E multiple of 21x. While this rests in the elevated 87th percentile of all readings since 1980, it sits roughly 11% below the euphoric peak of 23x recorded in late 2025. Meanwhile, the median S&P 500 constituent trades at a more reasonable 18x forward earnings—historically rich, but entirely consistent with the structural trends of the past several years.

Technical Analysis: Breakouts and Options Dynamics

S&P 500 E-mini Futures (ES) Execution

The intraday volume profile for the ES futures contract shows a clear structural recovery. The early-week sell-off successfully retested and defended key technical support blocks before executing a textbook V-shaped reversal on Thursday and Friday to close near the weekly highs.

This technical resilience came despite a significant accumulation of protective puts. As tracked below, total put option volume on the S&P 500 spiked noticeably during the early-week SpaceX liquidity drain, providing a deep pool of short-covering fuel once the market reversed higher.

Technical Analysis

From our Discord Community Advanced Channel:

Fixed Income & Central Bank Expectations

Global Sovereign Yields Cool Off

The softer-than-expected inflation metrics triggered immediate relief across global fixed income desks, pulling yields down from their recent local peaks:

Central Bank Watch: All Eyes on the “Warsh” FOMC

The global central banking landscape remains highly active. The ECB delivered an expected 25bps rate hike, keeping its near-term policy adjustments perfectly in line with market consensus.

Domestically, the spotlight turns directly to Wednesday’s upcoming FOMC Meeting—marking the highly anticipated first policy meeting under the “Warsh” Fed leadership. According to CME FedWatch data, the interest rate futures market is pricing in a 97.4% probability of a pause (no change) for this June meeting, keeping the target rate steady at 3.50%–3.75%.

Looking out to the December 2026 terminal projections, the market curve displays a highly balanced outlook: a 39.6% probability of maintaining current rates versus a 42.2% probability of a modest 25bps increase to the 3.75%–4.00% band.

Meanwhile, market volatility has steadily deflated from its recent spikes. The VIX retreated to settle at 17.68%, dropping -2.28 points on the week as premium buyers unwound hedges post-CPI and post-SpaceX.

The Week Ahead: Core Catalysts & Quadruple Witching

The upcoming calendar features heavy event risk, highlighted by a shortened U.S. trading week and massive structural rebalancings. Note that U.S. markets are closed on Friday, meaning the massive quarterly Options Expiry (OpEx) and major domestic index rebalancings will hit the tape on Thursday instead. Expect gargantuan structural volumes during Thursday’s closing cross.

High-Impact Macro Calendar

• 15-Jun (Monday): Empire State Manufacturing; Industrial Production; Capacity Utilization; NAHB Housing Index.
• 16-Jun (Tuesday): ADP Employment Change; Housing Starts; Building Permits; BOJ Interest Rate Decision.
• 17-Jun (Wednesday): US Retail Sales; Business Inventories; FOMC Rate Decision & Press Conference.
• 18-Jun (Thursday): US Leading Index; TIC Flows; Philly Fed Business Outlook; BoE Rate Decision; Quarterly Options Expiry / Index Rebalancing.

Corporate Earnings Quiet Zone

The corporate calendar enters its typical mid-quarter lull, with only a few brand-name operations reporting across the weekly landscape:

• Wednesday: Progressive (PGR), Jabil (JBL), CarMax (KMX)
• Thursday: Kroger (KR), Accenture (ACN)

Trader’s Note: If you hold active front-month futures positions, do not forget to execute your rolls from the June contract to the September contract early this week. The SPY Weekly Straddle is currently pricing in an implied move of +/- 1.9%, reflecting a market that is highly comfortable with the new structural floor established post-SpaceX. Keep your execution disciplined.

Stay Connected

Want to dive deeper or join the community?

📧 Book mentoring for Q3 2026: https://duponttrading.com/mentoring/

🎥 Access the 4×4 video series: https://duponttrading.com/4×4-course/

💬 Join the Discord: 30 channels of trading insights: https://discord.com/invite/Yf42SgAx7f

https://buy.stripe.com/5kA3dmdVV1g4cuIaEE

For any questions or to join our mentoring sessions, email us at Greg📩Contact: greg@duponttrading.comHave a good Trading Week!