Jobs Miss Saves the Dow. Chips Fall for a Second Day. Tesla Beats — and Drops.

A Fractured Close: Dow at a Record, Nasdaq at a Two-Day Hole

57,000 Jobs Turns the Rate Conversation Upside Down

• The Bureau of Labor Statistics reported that the US economy added just 57,000 jobs in June — roughly half the 115,000 Dow Jones consensus estimate and well below May's downwardly revised 129,000. It snapped a three-month streak of above-expectation prints and was the weakest month since early 2025. April and May were both revised down, with a combined 74,000 fewer jobs than originally reported.
• The unemployment rate dipped to 4.2% from 4.3%, a mild positive — but the improvement was partly driven by the labor force participation rate falling 0.3 percentage points to 61.5%, the lowest since March 2021, as some workers stopped looking for work rather than finding jobs. Average hourly earnings rose 0.3% month-over-month to $37.64, holding at a 3.5% annual pace — still above the Fed's comfort zone. Leisure and hospitality shed 61,000 jobs — the biggest drag in the report, partly attributed by the BLS to "weaker than usual seasonal hiring." World Cup-related hiring in May likely pulled forward some gains that then reversed in June.
• Markets responded swiftly: according to CME FedWatch, the probability of a September rate hike dropped from approximately 65% to around 50% in the minutes following the report. Fed Chair Kevin Warsh had called the jobs picture "steady" just Wednesday at the ECB's Sintra Forum. The soft print now shifts the July 29 FOMC meeting from a potential hike decision to a holding pattern, with October now the most likely window traders are watching.
• Treasury markets rallied as hike expectations softened: 2-year yields edged lower and the 10-year dipped from near 4.46%. The dollar weakened modestly. The rate-sensitive sectors of the market — financials, consumer staples, healthcare — outperformed meaningfully on the session, while the rate-hike-sensitive tech sector remained on the back foot from the chip narrative started Wednesday.

Chips Extend Losses; Tesla Beats and Drops; Google Loses in Europe

• The semiconductor selloff entered its second day: Teradyne (TER) fell ▼ 13.6%, KLA Corporation (KLAC) dropped ▼ 11.5%, SanDisk (SNDK) slid another ▼ 11%+, and Micron (MU) lost ▼ 5.5%. The Roundhill Memory ETF (DRAM) is now on pace to end the week down nearly 15% — a stunning reversal for an ETF that had nearly tripled from its April lows. Even Nvidia (NVDA) fell ▼ 1.4%.
• Tesla (TSLA) fell ▼ 7.5% — its worst day in nearly a year — despite reporting Q2 deliveries of 480,126 vehicles, which beat the 406,024 consensus by a wide margin and represented a 25% year-over-year increase. Investors appear to have already priced in the beat during the stock's 8% rally Monday. Tesla has now declined on each of the past three quarterly delivery reports — a pattern where good news is sold. Full Q2 financials arrive July 22. Tesla's NHTSA investigation into an FSD-related fatal crash remains an overhang. The stock is still down about 16% year-to-date despite the delivery beat.
• Alphabet/Google (GOOGL) fell ▼ ~1% after Europe's top court upheld a €4.1 billion ($4.67 billion) fine — the original 2018 European Commission penalty for anticompetitive Android practices. The ruling ends years of appeals and represents Google's largest regulatory loss in Europe. The fine itself is manageable for Alphabet; the reputational and precedent-setting impact on future EU antitrust cases is the more significant concern.
• OpenAI is reportedly in discussions to grant the US government a 5% equity stake in the company — a development that adds a new geopolitical dimension to the AI race. The reports circulated during the session alongside continued speculation about an OpenAI IPO timeline. No deal has been confirmed. Bending Spoons — which surged nearly 40% on its Nasdaq IPO debut Wednesday — gave back ▼ 7% on Thursday as first-day enthusiasm faded.

Apple, Netflix, and the Dow's Old-Economy Names Quietly Won the Week

• Apple (AAPL) surged ▲ 4.8%, making it one of the Dow's biggest contributors to Thursday's record. The move came without a specific catalyst — analysts attributed it to rotation from chip names into mega-cap quality, the jobs-driven rate relief rally, and broader rebalancing ahead of the long weekend. Apple closed near $241 and is now among the world's three largest companies by market cap alongside Nvidia and Alphabet.
• Netflix (NFLX) gained ▲ 5% — its best day since February — making it one of the Nasdaq-100's rare outperformers in an otherwise ugly session for the index. The rally was supported by analyst commentary: Wells Fargo noted Netflix's forward P/E sits two standard deviations below its 2023–current average, representing compelling value ahead of Q2 earnings on July 16. Investors are also watching whether Netflix moves on NBCUniversal assets following Comcast's announced spinoff.
• McDonald's (MCD) rose ▲ 4.1% and Walmart (WMT) gained approximately ▲ 3% — two Dow stalwarts that benefited directly from the "soft jobs = no hike = good for defensive consumer" narrative. Amgen (AMGN) added ▲ 2.8% after a federal judge blocked Colorado's attempt to cap Enbrel prices at 70%, removing a meaningful pricing risk. Healthcare broadly outperformed.
• Jersey Mike's filed for an IPO on the NYSE under the ticker JMKE, reporting 50% same-store sales growth from 2020–2025 and $4.3 billion in 2025 systemwide sales. It's the latest sign that the IPO window remains open for businesses with clean fundamentals — in contrast to the more speculative tech listings of recent years. The filing was well-received by the market.

Warsh Holds His Cards; Markets Price Out July Hike; Iran Talks Continue

• The June jobs miss puts Fed Chair Kevin Warsh in a more comfortable position heading into the July 29 FOMC meeting. Warsh has consistently avoided forward guidance — but a 57K print (vs. a 3.5% wage growth that hasn't cooled) gives him reason to hold without declaring victory or defeat on inflation. Markets now see October as the more likely window for any additional hike, though a July move has not been fully ruled out. Core PCE remains at 3.4%, well above the 2% target.
• The labor force participation rate fell to 61.5% — its lowest since March 2021 — complicating the "unemployment fell to 4.2%" headline. When workers leave the labor force rather than find jobs, the unemployment rate can drop for the wrong reasons. The BLS noted that leisure and hospitality shed 61,000 jobs, likely due to the post-World Cup seasonal unwind that had inflated May's blowout print. Prior revisions cut 74,000 jobs from the combined April–May figure.
• Oil prices fell 1.4% to $67.59/barrel (WTI) as US-Iran nuclear talks in Qatar showed tentative progress. President Trump said denuclearization discussions were "moving along well," and Qatar confirmed the talks had been "positive" even without a breakthrough. A diplomatic resolution to the Iran conflict would be the most significant downside catalyst for oil prices — and potentially the biggest macro relief for the broader market — in H2 2026.
• The South Korean Kospi fell 7.9% overnight on spillover from the US chip selloff, as Samsung Electronics and SK Hynix were caught in the same narrative: if hyperscaler AI buildouts are slowing or capacity is becoming surplus, memory demand may have already peaked for this cycle. The Korean semiconductor sector's response shows how global the chip selloff has become beyond what is happening in US markets.

What to Watch After the Holiday Weekend

• Markets reopen Monday, July 6. The NYSE and Nasdaq are closed Friday, July 3, in observance of Independence Day. Bond markets also closed early Thursday at 2:00 PM ET and remain closed Friday. Monday will be the first full session of the post-holiday week — expect thinner-than-normal volume Monday as summer desks return gradually. The week's big event arrives Tuesday with the June CPI report, which matters far more for Fed policy than Thursday's jobs miss did.
• SpaceX (SPCX) joins the Nasdaq-100 on July 7. The most-anticipated index addition in years — J.P. Morgan estimates approximately $4.3 billion in passive inflows as index funds rebalance. SPCX dropped 7.9% Wednesday after the FAA added SpaceX to an internal prohibited investment list; Elon Musk denied reports of a consumer AI device prototype. The stock partially recovered Thursday ahead of its index debut. The passive bid should be a mechanical tailwind heading into next week.
• June CPI (Tuesday, July 7, 7:30 AM CT). The week's pivotal data point after Thursday's jobs miss took the immediate hike pressure off the Fed. If CPI comes in hot — particularly core services — rate expectations could reassert themselves and revive pressure on tech and rate-sensitive equities. A soft CPI could open the door to a more sustained rotation into defensive and consumer names. Warsh has been clear: inflation is his north star.
• Tesla Q2 earnings: July 22. Thursday's delivery beat (480K vs. 406K expected) is impressive, but investors will be scrutinizing margins, energy storage profitability, Cybercab production timelines, and Optimus robot updates. Tesla raised its 2026 capex guide to over $25 billion and now expects negative free cash flow for the rest of the year. The question for TSLA bulls: can autonomy upside justify the cash burn? Watch for any commentary on the NHTSA FSD investigation.
• OpenAI government stake talks. Reports of OpenAI offering the US government a 5% equity stake signal an entirely new dynamic in the AI industry — one where the government becomes a direct stakeholder in the leading model provider. If confirmed, the structural and competitive implications for the sector are significant and will drive discussion across AI, defense, and cloud infrastructure names throughout the coming weeks.