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Market Headlines 👀 

• US NY Fed manufacturing index comes in at -6; est: -12.5.

• Nvidia (NVDA) announces Omniverse cloud sensor RTX microservices to supercharge progress in autonomous AI.

• Goldman Sachs (GS) raises its SPX target to 5600 and says 6300 is possible.

• Evercore ISI raises its SPX target to 6000.

• Adobe (ADBE) US Doj is suing the company for creating pricey subscriptions and making it hard to cancel for consumers.

• Sea Limited (SE) rolls out shopping feature in messenger for users in Thailand in partnership with Meta.

• Tempus AI (TEM) Google backed tech healthcare AI startup shares popped 15% Friday following its IPO.

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S&P 500 Heatmap 🔥 

Recap Around the Street 🧠

U.S. markets, though stunningly expensive compared to their international counterparts, continue to deliver superior earnings growth and earnings quality, which has been the key driver of their relative outperformance (we argue that stronger and more stable earnings growth has allowed for these higher valuations in the U.S. as well).

The chart below shows how, since the 2007 peak, the S&P 500 has grown its earnings per share by a total of 176%. Compare this to international developed (EAFE), which has grown its EPS by a whopping 2% since 2007, while emerging (EM) still has earnings 3% lower!(Contributed by Cameron Dawson, CIO at NewEdge Wealth).

Plenty of arguments can be made about index quality and constitution (the S&P 500 has a higher weight to high cash generating, elevated Return on Invested Capital Tech companies), however the S&P 500’s 21.1x forward PE is truly in rarefied air, only trading higher during the Tech bubble and the COVID policy bubble. This reflects risk appetite, robust growth forecasts, and ample liquidity. (Contributed by Cameron Dawson, CIO at NewEdge Wealth).

Market Preview 🎞️ 

• Tuesday, June 18th: Business inventories; Retail sales

• Wednesday, June 19th: Holiday, markets closed

• Thursday, June 20th: Weekly jobless claims; Housing starts; Building permits

• Friday, June 21st: Options expiration (OPEX); Existing home sales

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That’s all for today, folks! We’ll be back around the same time Thursday with a curated list of important news, economic data and market highlights. 

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