🩸The Pullback Everyone Warned About Just Hit...

Hot jobs, hawkish Fed, and a SpaceX IPO sucking up liquidity.

Author

Humbled Trader
June 07, 2026

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Well, that escalated quickly. The pullback everyone kept warning about finally showed up, and the trigger was a blowout May jobs report: 172,000 jobs versus the ~85,000 expected, unemployment steady at 4.3%. Strong on paper, but traders read it as "the Fed has no reason to cut." Classic good-news-is-bad-news.

Friday took the brunt. The Nasdaq cratered 4.2% (its worst session since April 2025), the S&P 500 fell 2.6%, and the Dow held best at -1.4%. Semis led the carnage and wiped roughly $1 trillion off the tape, with Marvell -16%, Micron -13%, and Broadcom -7%. The setup was fragile to begin with: the S&P had ripped 20.6% off the March low with no pause, and spiking yields plus next Friday's record SpaceX IPO gave traders every excuse to take profits. The VIX agreed, popping nearly 40% to 21.51. Schwab's read: a 5-10% pullback in a bull market is normal. Worth watching, not panicking.

‎TLDR Stock Market Weekly Update - June 7, 2026

📉 Market Trends

  • Good News, Bad Reaction: A hot jobs print flipped sentiment risk-off as traders priced out rate cuts and started eyeing a possible hike by year-end.

  • Semis Led the Unwind: The AI-infrastructure trade that powered the rally became the source of the selloff, with chipmakers down double digits across the board.

  • Overdue Digestion: A 20.6% run off the March low with no pullback left the market stretched. This looks more like healthy consolidation than a trend change.

  • Liquidity Magnet Incoming: The record SpaceX IPO trades next Friday, and rotation out of recent winners to fund it may be adding fuel to the selling.

  • Seasonality Headwind: June rarely shows up as a bullish month, and price action this week leaned into that reputation.

📊 Technical Levels & Market Signals

  • Volatility Wakes Up: The VIX jumped almost 40% in one session to 21.51 from 15.40, the first real fear spike in weeks. Above 20 means bigger overnight swings are back on the menu.

  • Nasdaq Took the Damage: A 4.2% drop puts tech in the weakest technical spot of the major indices, with semis breaking down hardest.

  • Dow Relative Strength: Down just 1.4% on Friday, the Dow showed defensive rotation as money looked for cover away from high-beta tech.

  • Pullback, Not Breakdown (Yet): A 5-10% dip after a 20%+ run is textbook bull-market behavior. The question next week is whether buyers step in or the selling feeds on itself.

💰 Economic Data, Rates & the Fed

  • Jobs Ran Hot: May payrolls came in at 172,000 versus ~85,000 expected, with unemployment steady at 4.3%. The strength is exactly what kept the Fed cautious.

  • Yields Spiked: The 10-year jumped to about 4.55% and the 2-year hit 4.17%, its highest since February 2025. The 10s-2s spread sits around +42bp.

  • Fed on Hold: CME FedWatch shows roughly 70% odds of no change at the June 16-17 FOMC, with about 28% pricing a cut. Rates stay at 3.50-3.75% for now.

  • Hike Talk Returns: After the jobs beat, markets started flirting with the idea of a hike by year-end, a sharp shift from the cut-focused tone of recent months.

Sources: Charles Schwab

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📅 Coming up next week…

Economic Events:

  • Wed (6/10): CPI (May), MBA Mortgage Applications

  • Thu (6/11): PPI (May), Initial Jobless Claims, Continuing Claims

  • Fri (6/12): University of Michigan Consumer Sentiment (preliminary)

Notable Earnings Reports:

  • Mon (6/8): FCEL

  • Tue (6/9): CASY, BARK, LAKE, LMNE

  • Wed (6/10): ORCL, CHWY

  • Thu (6/11): ADBE, RH

Sources: Earnings Whispers, Charles Schwab

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UNH $396.6

  • The sharp selloff in technology stocks may be triggering a broader institutional rotation. Many risk-parity and target-volatility funds are likely reducing tech exposure and reallocating toward defensive sectors as volatility rises.

  • Healthcare remains particularly attractive due to its stable cash flows, domestic revenue exposure, and lower sensitivity to interest rates compared to other defensive sectors.

  • Leaning bullish on this name. As long as the stock holds the $394s area on the daily, I’m looking for a textbook trend join long setup as a potential swing-trade idea.

  • Position Disclosure: No position

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MRVL $263.47

  • MRVL's upcoming inclusion in the S&P 500 creates a short-term catalyst, as index funds that track the benchmark will be required to purchase shares ahead of the June 22 effective date.

  • Historically, newly added companies often experience increased volume and buying pressure in the days leading up to inclusion as passive funds rebalance and traders position ahead of those flows. This could support continued momentum over the next couple of weeks.

  • The stock has pulled back drastically on Friday amidst the AI/semiconductor names sell off. This could create a decent entry opportunity if the key level holds up.

  • I’m watching the $259s area on the daily for consolidation. If that KL holds, I’d be looking to go long the dip for a trend re-claim to the upside.

  • Position Disclosure: No position

🗞️ Market movers you might’ve missed:

- $MRVL Marvell Surges After Nvidia CEO Calls It the Next Trillion-Dollar Company
- How we traded: Backside Long Strategy

- $MU Micron Nears Earnings as AI Memory Demand Remains Strong
- How we traded: Trend join long

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