Week Ending 06_13_2025 Stock Market Recap

Geopolitics took center stage this week and sent the market lower. What might this mean moving forward? TUNE IN TO FIND OUT!

Episode Transcript

(00:33):
Hello and welcome to
this week's edition of the Big Money Report. I'm your
host, David Boothe, President and Chief Investment Officer
of BIG Investment Services. That's B-I-G, Boothe
Investment Group. We're a full-service financial advisory based
out of Dover, Delaware, serving clients all across America.

(00:55):
And you can read all about us at abigplan.com. That's www.abigplan.com. I
like to put the show together once a week just to give you a recap of the week behind and
a peek at the week and weeks to come, trying to keep you up
to speed with you and your money. And we're glad you're with us today. It
is Friday the 13th. Friday,

(01:16):
June 13th, 2025. Welcome to
the end of the week. Some shout outs to Bill, Marsha, Bob, Jody,
Bob, Diane, so many folks, so many folks tune in week in, week
out. We appreciate it. Glad you're getting some value out of the program. So,
hey, what is going on with the markets? Well, they're down. Not
too much of a surprise. We kind of thought the market was kind of stretched anyway,

(01:38):
so we've been looking for a pullback. We'll talk about the reasons here
for just a moment, but Dow Jones is down 1.3% on the week,
back to negative on the year, down almost 1% on the year. The
S&P 500 down 0.4% on the week, the
NASDAQ composite down 0.6, and the Russell Small Cap Index down
1.4%. So all the major indices drifting a little bit lower this week. And as you might

(02:00):
expect, the volatility index bouncing up quite a bit, up
24% this week, up to a 20.8 on the VIX. So I
think I can go a little higher. We'll see how that shakes out. What I
don't like are the bonds. Now, bonds did do a little better for the week. They were
1.1% on the week TLT was, which is good because they just
haven't had the traction I'd like to see. But I think a lot of the reason

(02:22):
why they did well this week is because of the inflation numbers.
We had a really good CPI, consumer price index, and
a good PPI, producer price index of both retail and wholesale.
Numbers were better than expected. I think the market responded positively
to that. So rates came in a little bit, came down a little bit,
bonds went up. But what I didn't like, beyond not like, what I hated

(02:44):
to see. was the action today here on Friday. You know,
look, I'm sure you've heard the news. Israel has attacked Iran
and a major, major offensive. It's not lobbing
a missile here or there. It was a really major move they made
and caused the markets to go down quite a bit today. I mean, all of them are down over 1% today.
But what shocked me was how poorly bonds performed today. I've

(03:07):
said for many years that America's okay as long as everybody
runs to the dollar when they're afraid. As long as everyone runs to the United
States when they're scared, then we're in really good position and
we've got time to work things out. But I've got to tell you, I don't like seeing
the action in the bond market today. Bonds are down. TLT
was down 1% today, along with the market down 1%. That's

(03:28):
not what you want to see. Now, the dollar was up a little bit, but that wasn't even up
a whole lot, up 0.2%. It seemed like the real safety trade
was gold. Gold was up 1.3% on the day,
and it was up 3.6% on the week. Silver
up 0.8% on the week. And we look at all the other sectors, the
big performers were energy. A lot of it happened today, up 5.6% on the week. And

(03:52):
other than that, technology at 0.3, semiconductors
at 1.6. Everything else was just kind of down, flat
to down. Financials are down two and a half, but the big mover was
energy of 5.6% this week. So what's
moving markets? Well, we've had some good things coming into the
week. They have the China and U.S. delegations meeting

(04:13):
in London to discuss trade negotiations. The reports out
of those meetings were positive. The market responded in kind. We
had good CPI and PPI, and that's important because everyone's
been anticipating a huge spike in inflation due
to tariffs. I think that could still be on the way.
See, look, there's been a tremendous amount of front running

(04:34):
the tariffs. We talked about that. much earlier in the year.
Can you believe we're over halfway through the year already? But anyway, way
back in February and March, we talked extensively about this. There was
a tremendous amount of front-running tariffs that caused
a historic trade imbalance. It also caused a
negative GDP for the first quarter. Now we're actually seeing
some preliminary reports of a really huge GDP for

(04:58):
the second quarter because all that front-running is now showing up in inventory
as assets. So by buying all this stuff ahead of time, ahead
of the tariffs kicking in, companies have had the ability to
kind of manage this pricing and not have it just spike straight up.
So, and of course, there's been a delay as well. So all of those things are
factors. I'm not saying that the inflation isn't coming. I

(05:20):
think that it's still likely to show up or probably later in
the year. And I think it'll be kind of that one and done type of
scenario. You'll see that spike and then it should settle down. It's not
a continuous thing. It's not like the inflation we were seeing
in 2022 where everything was just spiraling out of control, escalating
every week. You know, I had clients in the construction industry,

(05:41):
they were buying conduit for like electric lines one
day and then pricing the job out. And then a week later
it was up 20%. So they all had to build in price
adjustments to their contracts. It was just a mess. The tariffs won't
be like that. They'll hit and then they should settle. So
we'll see how all that plays out. But I guess my point is this, the economic data

(06:02):
this week has been decent. Market was responding in kind. And
of course, the Israel-Iran flare up caused the
markets to go off the rails here today on Friday. That said, I
will say this, I'm really surprised they didn't end worse today.
I mean, I thought it would be an uglier day on the market. The S&P was only
down 1.1% on the day. I kind of expected it to be worse

(06:23):
than that, but it held in pretty well. One of the reasons is because
the targets have been very specific. They've stayed away
from Iran's oil production. Now, if Iran
responds, if things escalate, which look, I think they probably will respond
if they can. If they're able to, I think there will probably be
some sort of response. We'll have to see how all this plays out. But if

(06:44):
Israel stays away from their oil production, then prices probably
won't go up a whole heck of a lot more. I'm just doing some research on
that, looking at some things regarding historic conflicts and
how oil prices have been impacted. When
you go back and let's go back to 1948, that's
the data that I was looking at earlier today. The average

(07:07):
increase is about 17% in energy when something flares up
in the Middle East. It takes about two and a half months for prices
to peak, and then they settle back down. But if you go back to 1948, that includes the
Yom Kippur War in 1973, and that was 135% spike in energy prices. You
might remember the lines, the gas lines and all those types of

(07:28):
things at the time. So if you take that out, if
you take out the Yom Kippur War, then
the spikes really aren't quite as bad. They tend to be quite
a bit more muted, anywhere from 2% spikes up
to maybe 32% with the Gulf War in 1990. And
look, the market tends to react to geopolitical events

(07:48):
pretty quickly and then settle back down pretty
quickly. So tends to look past it, doesn't seem to hang on
to it for very long. We saw the Russia-Ukraine war, and
we've seen it with other conflicts throughout. history. So I
think there's probably still some more pain based off the technical. So you remember last week,
I mentioned that the market looks like it was stretched. We

(08:08):
got nines and thirteens on the DeMarc countdowns. These
are just technicals that kind of give me an idea where
the move has been exhausted, whether that move is to the upside or the downside. When
we get these DeMarc counts, it kind of indicates some exhaustion. There's other
technical indicators that were pointing to the market, maybe
wanting to roll over and pull back here for a bit. And you say, well, David, you

(08:30):
know, that just seems hogwash to me. How could you know that Israel is
going to attack Iran and send the market down today? Well, I don't know. But
look, the market looks for the reason. Sometimes it
looks like really coincidental. You go back to 2020. We had
a big, big 9 and 13 counts and
that the mark indicators, we had all kinds of indicators saying the market was stretched

(08:51):
early 2020 and then COVID hit. And of course, you had this really
gigantic move lower and say, well, it was COVID. It
was a coincidence. Yeah, but look, there's multiple times
throughout history where we get these exhausted trends in
the market and the market sells off and it can be, it'll find
a reason, right? Someone can trip and stump their toe and make headlines

(09:13):
and the market will take it as a reason to sell off. You don't know what it's
going to latch onto. Sometimes it's given something obvious
like today with Israel and Iran. Sometimes
the market has to look a little bit harder for a reason, but it'll find it.
When it wants to sell off, when investors want to take profits, they'll
find the reason, they'll pull the trigger. So I think that this can last a

(09:33):
little while longer. Today's move lower, I think that could kind
of set us up for the market to kind of drift a little bit lower over the coming
weeks. I don't expect anything really major. And
I think that 5,800, that 200-day moving average
is that first strong line in the sand of support there.
And the market might work its way down there and stop. So like

(09:55):
I did a little bit of buying today in the morning on the pullbacks, all the
oil stocks and anything related to energy kind of jumped up. And this
stuff's been lagging for a bit. I was getting ready to buy more of
this stuff within days. And the market forced
me to kind of move a little bit faster. So this morning, everything spiked
up big on the open and then it pulled back quite a bit mid-morning. And

(10:15):
I took that as an opportunity to add a little bit more money to Schlumberger. That's
oil drilling services here in the US, actually all
over the world. But with our current administration being so
pro-energy, I think this is a good place to have some extra exposure. So
I did that. And for folks that have had new money come in, I put some of your
money to work today, not a lot. I think the market goes lower. So

(10:36):
there's a lot of things that we did not buy today, but we'll be looking to
do so in the next couple of weeks if things drift lower. And I think that
they probably will. The technical indicators suggest that they will.
Now we've got a geopolitical reason to
sink our teeth into, so I think that the probabilities are pretty high.
We'll pull back a little bit. As I've mentioned the last couple of weeks, when

(10:57):
you look at everything that's happened since the lows
in April, I think it's highly unlikely, highly
improbable that we're going to go back down to those lows. I think the worst is likely
behind us, and this move that we're getting right now will
likely be probably one of the better buying opportunities you're going to get for the rest of the
year. And we'll be looking to kind of step in and do a little bit more buying if

(11:18):
the opportunity arises to get all the new money that's come in. We've been sitting on it here
for a couple of weeks, waiting for a step back. So all you new clients, all
you folks that have deposited new money into your accounts here in just the last
couple of weeks, we haven't done anything yet. We're doing it now and
we'll get that money worked in as the market drifts a little bit lower. So
that's what I've got for you. Nothing to get too alarmed about. We'll continue to
watch it real close and make moves as necessary. But

(11:41):
hey, right now it's kind of doing what it always does when these things happen.
Of course, they've sold off a little bit towards the end of the day here in preparation for
what the unknowns that might take place over the weekend. I think we're in
pretty good shape where we sit. So I'm gonna go and wrap up. Between now and next few
minutes, you're thinking about your future, your long-term goals, all the things you
want to do with you and your money. Maybe just retire a

(12:01):
little early. Take that safari to Africa. I've
got a client that did that. Done it a couple of times, actually. Loved
it. Hey, you know what your goals are. Don't just think about it. Think big.
Thank you for listening to this week's edition of the Big Money Report with
your host, David Boothe, President and Financial Advisor at

(12:23):
BIG Investment Services. For more information on BIG and
how you can access their planning and investment management services, visit
them at abigplan.com. That's abigplan.com. Or
call them toll free at 866-946-PLAN. That's 866-946-7526. The

(12:45):
foregoing content reflects the opinions of David Boothe and Boothe Investment Group,
Inc., and is subject to change at any time without notice. There's no
guarantee that the statements, opinions, or forecasts provided herein will
prove to be correct. Content provided herein is for informational purposes only
and should not be used or construed as investment advice or a recommendation regarding
the purchase or sale of any security. All investing involves risk, including the
potential for loss of principal. There is no guarantee that any investment plan or