HPE crashes the AI party 🚀

Welcome back to the Day Trading newsletter 📈

Stocks kicked off June at fresh records, with a new chip from Nvidia and a blockbuster earnings beat from Hewlett Packard Enterprise reminding everyone the AI trade still has legs (even as oil ripped higher on renewed Iran tensions).

Let’s get into it 👇️ 

📊 The S&P 500 closed at a fresh record to start June, shrugging off an oil spike as tech led the way. The index rose 0.26% Monday to 7,599.96, while the Nasdaq added 0.42% to 27,086.81 and the Dow ticked up 46 points to 51,078.88 - all three at all-time highs. Nvidia's new chip and resilient factory data powered the gains.

🖥️ Nvidia barged into the personal-computer market with a new Arm-based chip, sending its stock up more than 6%. CEO Jensen Huang unveiled the RTX Spark superchip at Computex in Taipei, set to power Windows laptops from Dell, HP, Microsoft, and others this fall. The move added roughly $319 billion in market value but battered incumbents. Intel, AMD, and Qualcomm all fell, while chip designer Arm surged.

🛢️ Oil jumped about 5% Monday as renewed Iran tensions revived fears over the Strait of Hormuz. West Texas Intermediate settled near $92 a barrel and Brent near $95 after Iranian media reported Tehran had suspended talks with Washington and threatened to close the key shipping chokepoint. The spike reverses part of oil's steep May slide, when traders had bet on a U.S.-Iran ceasefire.

🏭️ U.S. manufacturing activity hit its highest level in four years, signaling the factory sector is rebounding. The ISM Manufacturing PMI rose to 54.0 in May from 52.7, beating forecasts of 53 and marking the strongest reading since May 2022. New orders accelerated and all six of the largest manufacturing industries grew (though 42% of surveyed firms flagged the Iran war as a concern).

👙 Victoria's Secret shares rocketed more than 30% after a blowout quarter and raised guidance. The retailer posted adjusted EPS of $0.60, nearly double the $0.32 expected, on revenue up 15% to $1.56 billion. It lifted full-year sales guidance to $7.03-$7.13 billion and roughly doubled its operating-income outlook, citing double-digit growth across its brands including PINK.

🔼 Marvell Technology soared about 25% after Nvidia's Jensen Huang called it the next trillion-dollar company. Speaking at Computex, Huang praised Marvell's networking and connectivity chips as essential to modern AI data centers, where workloads run across thousands of linked processors. The endorsement (not earnings) drove the move, and follows Nvidia's $2 billion investment in the chipmaker earlier this year.

🔻 Gold slipped about 1.5% to start the week as the risk-on mood pulled money into stocks. The metal eased to roughly $4,480 an ounce Monday, retreating from recent highs even as oil surged and Middle East tensions flared, a sign investors were chasing equities rather than safe havens. Gold remains up sharply over the past year.

🔽 Bitcoin sank to around $69,000, its lowest level since April, as crypto's rough patch deepened. The token slid roughly 4% Tuesday morning, extending a slump that has left it badly lagging record-setting stocks. Risk-off flows tied to renewed Middle East tensions and a higher-rate backdrop continued to weigh on the broader digital-asset complex.

Hewlett Packard Enterprise reported fiscal second-quarter results Monday afternoon and blew the doors off.

Revenue came in at $10.68 billion, up 40% year-over-year and roughly $900 million ahead of Wall Street's estimate. Adjusted earnings of $0.79 a share crushed the $0.53 analysts expected and more than doubled last year's figure.

Server revenue jumped 32.7% to $5.5 billion, while networking (supercharged by the Juniper Networks acquisition) soared to $2.69 billion.

Shares rocketed roughly 25%, pacing for their best day on record, after the report landed.

HPE also raised its full-year revenue-growth guidance to 29-33% (from 17-22%). This puts the company, in their words, "two years ahead" of the long-term plan it laid out for fiscal 2028.

This is more concrete proof that AI infrastructure spending is broadening well beyond Nvidia and the big cloud players.

HPE sells the servers, networking gear, and storage that companies and governments need to run AI on their own premises, and demand is clearly widening.

61% of its cumulative AI orders come from sovereign governments and large enterprises, not hyperscalers like Amazon or Google.

Just as important, margins expanded sharply and free cash flow swung strongly positive, meaning this is AI-driven growth that actually generates cash rather than just inflating revenue.

HPE entered the current quarter with a record $5.9 billion AI-systems backlog, and orders more than doubled year-over-year. The pipeline is refilling faster than it empties.

What to watch:

• Whether HPE can convert that record backlog into profitable revenue without delays

• Whether the Juniper integration keeps delivering.

Another big tell comes Wednesday, when AI-chip bellwether Broadcom reports.

That will be the next major read on whether the enterprise AI-spending wave is still building or starting to crest.

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⚠️ Disclaimer: Not financial advice. Do your research before making any trades.