The Dividend Cafe - Wednesday - June 3, 2026

Episode Date: June 3, 2026

Brian Szytel of The Bahnsen Group recaps a broad market sell-off (Dow -620, S&P -0.7%, Nasdaq -0.9%) after nine straight weeks of gains, noting there was no major new catalyst beyond slightly higher rates, higher oil, and ongoing Middle East tensions involving the U.S. and Iran. Year-to-date performance remains positive (Dow ~+6%, S&P ~+10%, Nasdaq ~+15%), and economic data was generally strong, including better-than-expected ADP private payrolls (122 vs. 110) and solid services readings. He highlights continued resilience in labor demand and some increased entry-level and AI-related hiring. Historically, nine-week winning streaks have often been followed by positive returns over 3, 6, and 12 months, though higher 10-year yields around 4.50% could cap risk assets. He adds the Fed may need to raise rates later this year if inflation stays high despite strong employment, while oil futures imply prices returning to the 70s over time. 00:00 Market Snapshot 00:37 Why Stocks Sold Off 01:25 Economic Data Check In 01:54 Jobs and AI Hiring Buzz 03:07 Nine Week Rally Context 04:15 Rates and Fed Outlook 05:10 Oil Inflation and Wrap Up 05:41 Disclosures Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com

Welcome to the Dividend Cafe weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. Welcome to Dividend Cafe. This is Brian Saitel with you here as usual on your Wednesday, June 3rd, and I'm speaking to you here from our Newport Beach, California office here at the Bonson Group. On a down day in markets overall, they had the Dow that was down 620 points on the day. S&P was down about seven tenths of a percent. NASDAQ was down roughly nine tenths of a percent. So sell off in stocks. And frankly, we were due. I mean, the market had been up now for nine straight weeks and actually nine straight days in a row.

And so we got a bit of a pullback here today. And really, there wasn't anything new in the news side of things that caused the selloff. Sometimes this is just what markets do. You did have interest rates move up a slight amount today and you had oil up. And you guess the culprit, it's Middle East tensions and some kinetic action between the U.S. and Iran. But that story has been ongoing and we just kind of waffle around it in markets a little bit. Generally speaking, the markets have been very positive. As you know, the Dow year to date is up almost 6%. SMP 500 is up about 10%. And NASDAQ is up about 15% roughly, give or take.

So it's been good so far this year. And on the day, we actually had generally positive economic data. We had a few things out. We had private payrolls. This is that ADP private payroll number that we look at better than expected. We got 122 over 110. We had an ISM services beat in the month of May. A little bit ahead of schedule. We had the SMP Global Services PMI come out two tents lower, but still in expansion territory.

And then services PMI was also in expansion territory. So pretty good across the board. And actually, that theme of labor hanging in there, And I spoke about that yesterday with new job openings that specifically and funny and interestingly related to AI types of positions, business and professional services. Some follow through on that today. The ADP private number reflected a positive number. And Bloomberg had a deal out talking about an increase in hiring that we've seen on the

younger end and the intro level end. So B of A had 2,000 summer interns that they're starting. And then B&Y had specifically entry level positions related to AI. It's just funny because it's such a one-size. trade sometimes when everybody just assumes intuitively because of this and presupposes this to be true, then that means that will be the outcome. When in fact it is often the opposite of that. And you remember that during the pandemic, everybody knew that nobody was going to ever go to a shopping mall or right on a plane again or be close to someone else or all these things. Houses were going to

go down in value. And all of the exact opposite happened. People craved experiences. They craved travel, ended up working from home and doing more things to make their homes more enjoyable to work out of and all that stuff. So to me, it's sort of funny and it's sort of same as it ever was, I suppose, in that regard. But all that to say around the market, this is technically a nine week in a row up move. That's a 19% move. So that's robust. That's a good move. We've actually been here before. There's been 10 other times in history since 1957 that we've had nine weeks in a row. So it's somewhat seldom, but it's not that rare either. It's in the middle, and this is not the most robust move by any means. But if you look at all of those instances

together, historically speaking, markets were positive both three, six, and 12 months out. There was a couple periods where that wasn't true, but for the most part, they were positive. And that isn't to say that this is the reason for you to go out and lever up the portfolio and buy more stocks. But just from historical context for what it may be worth, markets that are moving up, bull markets don't typically just die of old age for the sake of it. They get murdered by typically central bank action, you know, policy moving too tight, too fast, something like that. Of course, there can be an exogenous event of some kind. And I'm sure you can make some of those up of what they could be. But all that to say, I mean, the fundamentals are still positive.

And we're seeing that. That said, also, interest rates that have been moved higher here, 10 years now at 450, that can't go on forever without it affecting risk assets, too. Everything is priced around that risk-free rate, what multiples are. And the more we get over the 450 level on tens, I think the closer we get to markets having a bit of a cap on them. And the last thing I'll say is the Fed may raise rates at the end of the year because employment is good and the economy is good, but inflation is too high. And they should. I mean, that's the point. I mean, the whole mandate of this institution, and David had a wonderful dividend cafe specifically about the Fed independence that you should go read tomorrow or today if you can. But the whole purpose of it was to just have a dual

mandate and for it to be separate from a direct influence and set policy according to full employment and stable prices. And so if we've got full employment but unstable prices, then they have a job to do. Now, you may have an end to the war, the Strait of Hormuz opening and oil dropping 30 bucks in a day that can happen, in which case all the CPI models and all the inflation models, will be readjusted. And frankly, that's the base case. That's what markets are expecting. Forward futures in oil are not expecting prices to remain at $100 forever. They're expecting the year from now for them to be back in the 70s. So, but that's what I've got for you today. Reach out with your questions. We've got another day with you tomorrow and more to chew through

the market. So with that, I'll wish you well. Have a good evening. Thank you very much. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, member FINRA and SIPC with Hightower Advisors LLC, a registered investment advisor with the SEC. Securities are offered through Hightower Securities LLC. Advisory services are offered through Hightower Advisors, LLC. This is not an offer to buy or sell securities. No investment process is free at risk. There is no guarantee that the investment process or investment opportunities referenced

TIRAN will be profitable. Past performance is not indicative of current or future performance and is not a guarantee. The investment opportunities, referenced TIRAN, may not be suitable for all investors. All data and information referenced herein are from sources believed to be reliable. Any opinions, news, research, analyses, prices, or other information contained in this research is provided as general market commentary and does not constitute investment advice. The Bonsor Group in Hightower shall not in any way be liable for claims and make no express or implied representations or warranties as to the accuracy or completeness of the data and other information

or for statements or errors contained in or emissions from the obtained data and information referenced herein. The data and information are provided as of the date reference. Such data and information are subject to change without notice. This document was created for informational purposes only, the opinions expressed, are solely those of the Bonson Group, and do not represent those of Hightower Advisors LSC or any of its affiliates. High Tower advisors do not provide tax or legal advice. This material was not intended or written to be used or presented to any entity

as tax advice or tax information. Tax laws vary based on the client's individual circumstances and can change at any time without notice. Clients are urged to consult their tax or legal advisor for any related questions.