Nike Inc (NYSE: NKE) has been one big disappointment after another in recent years – and Josh Brown, a renowned investor and chief executive of Ritholtz has even lost conviction in its ability to recover.

The sportswear and performance brand is scheduled to report its financials for the fourth quarter in the final week of June.

Consensus is for it to earn just 11 cents on a per-share basis versus $1.01 a year ago.

Ahead of the earnings release, Nike stock is down nearly 25% versus its year-to-date high.

Why is Nike losing share to its competitors?

Nike’s chief executive Elliott Hill has been working on rebuilding ties with wholesale partners this year as part of his broader efforts aimed at reinvigorating growth at the footwear giant.

In March, he even told investors that “I’m proud of the progress we have made” on the turnaround plan. However, Josh Brown is not buying any of it.

According to the globally followed investor, none of what Nike has done so far suggests it’s headed for a successful turnaround.

Nike stock remains in shambles as the company’s celebrity representatives age out of popularity, he argued in a CNBC interview, adding “LeBron James is in his 40s – and Michael Jordan is about 30 years retired.”

Nike stock needs more than classic sneakers to run

Investors should note that Nike managed to come in ahead of Street estimates in its latest reported quarter. But that strength failed to breathe new life into its stock price.

“I don’t even know what we do with something like Nike stock here. It’s just a falling knife,” the chief executive of Ritholtz added in the said interview.

All in all, Brown is convinced that classic sneakers like Jordans or Air Force 1 will no longer prove sufficient for NKE to address competition that’s only getting fiercer by the minute.

That said, Nike shares do currently pay a dividend yield of 2.61% that makes them a little bit more attractive to own in 2025.

Should you buy NKE shares at the current discount?

Investors should note that Nike stands to take a material hit due to higher tariffs under the Trump administration as well.

In fact, it recently announced plans of raising prices, which may prove detrimental for a business that’s already grappling with a sales decline. NKE’s topline contracted another 9% in its fiscal Q3.

Still, Wall Street analysts haven’t thrown in the towel on Nike stock just yet.

Consensus rating on the company based out of Beaverton, Oregon remains at “overweight” with the mean target of about $73 indicating potential upside of about 20% from current levels.

Nike shares are currently trading at a discount price-to-earnings multiple relative to its historical average over the past five years.  

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Core inflation in Japan’s capital surged to a more than two-year high in May, primarily driven by persistent increases in food costs, according to data released on Friday.

This development intensifies the pressure on the Bank of Japan (BOJ) to consider further interest rate hikes, even as separate figures revealed a concerning slide in factory output, highlighting the central bank’s complex balancing act.

The Tokyo core consumer price index (CPI), a key metric that excludes volatile fresh food costs, rose by 3.6% in May compared to a year earlier.

This figure surpassed market forecasts, which had anticipated a 3.5% gain, and marked an acceleration from the 3.4% rise recorded in April.

The May reading represents the fastest annual pace of increase since January 2023, when core inflation hit 4.3%.

Significantly, core inflation in Tokyo, widely regarded as a leading indicator of nationwide price trends, has now exceeded the Bank of Japan’s 2% target for three consecutive years.

Further underscoring the broadening price pressures, a separate index that strips away the effects of both fresh food and fuel costs—a measure closely watched by the BOJ as an indicator of underlying price trends—rose by 3.3% in May from a year earlier, up from a 3.1% rise in March.

This persistent upward creep in prices is leading some analysts to recalibrate their expectations for BOJ policy.

“The Tokyo CPI showed a further broad-based acceleration in inflation, which suggests that the BOJ may hike even earlier than our current forecast of October,” commented Marcel Thieliant, head of Asia-Pacific at Capital Economics.

A Reuters poll conducted between May 7-13 indicated that most economists expect the BOJ to hold rates steady through September, with a small majority forecasting a rate hike by the end of the year.

Food costs and services drive inflation; factory output falters

Sticky food inflation remained the primary driver of the overall rise, with non-fresh food prices climbing 6.9% in May year-on-year, and the cost of rice experiencing a staggering 93.2% surge.

However, services inflation also gathered pace, accelerating to 2.2% in May from 2.0% in April. This suggests that companies are gradually beginning to pass on rising labor costs to consumers.

“The fact services prices rose is positive for the BOJ, which wants to keep alive expectations of further rate hikes,” observed Masato Koike, senior economist at Sompo Institute Plus.

However, he also pointed to external uncertainties: “But US policy uncertainty will make it hard to keep the BOJ from hiking too soon. By the time the dust settles, price developments could have changed in a way that makes rate hikes difficult.”

The inflationary concerns are juxtaposed with signs of weakness in the manufacturing sector.

Separate data released on Friday showed that Japan’s factory output fell by 0.9% in April compared to the previous month.

While manufacturers surveyed by the government expect output to increase by 9.0% in May, they anticipate a subsequent drop of 3.4% in June.

This indicates that manufacturers are feeling the pinch from slowing global demand and the economic repercussions of steep US tariffs, which could hurt their profits and discourage them from raising wages next year.

Many analysts also expect overall consumer inflation to slow in the coming months due to falling crude oil prices and a drop in import costs resulting from the yen’s recent rebound.

The BOJ’s tightrope walk: inflation vs. growth headwinds

Despite potential moderating factors, persistent food inflation may not allow the Bank of Japan to pause its rate hike considerations for an extended period.

A survey by private think tank Teikoku Databank, released on Friday, revealed that Japanese firms plan to hike prices for 1,932 food and beverage items in June, a figure triple that of a year ago.

This signals that more price increases are on the horizon for consumers.

BOJ Governor Kazuo Ueda acknowledged these dynamics in a parliamentary address on Friday, stating that the central bank was “mindful that companies continued to actively hike wages and raise prices to pass on higher costs.”

Adding to this, Tsutomu Watanabe, an academic at the University of Tokyo’s graduate school of economics, warned, “Japan may face a tricky situation where public attention to rising food prices heighten inflation expectations, which have so far been stable.”

The Bank of Japan ended its massive stimulus program last year and, in January, raised short-term interest rates to 0.5%, predicated on the view that Japan was on the verge of durably achieving its 2% inflation target.

While the central bank has signaled its readiness to raise rates further, the economic fallout from higher US tariffs has forced it to cut its growth forecasts, thereby complicating decisions around the timing of the next rate increase.

The BOJ now faces the delicate task of taming inflation without derailing a fragile economic recovery.

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European stock markets commenced Friday’s trading session with a slight downturn, as a renewed wave of caution swept through investor sentiment following a US court’s decision to temporarily reinstate President Donald Trump’s widespread tariffs.

Despite this immediate pressure, the benchmark pan-European index remained on track for a robust monthly gain.

As of 0711 GMT, the continent-wide STOXX 600 index was down 0.1%.

This dip was primarily attributed to the temporary reinstatement of the most sweeping of President Trump’s tariffs, a development that occurred just a day after a different US court had ordered an immediate block on them.

This legal seesaw has reintroduced a significant element of uncertainty into the global trade landscape.

However, looking at the broader monthly picture, the benchmark STOXX 600 was still poised for its first monthly advance in three months, having gained 3.8% so far.

This resilience has been built on a period of easing trade tensions earlier in the month and recent US fiscal concerns, which had prompted some investors to diversify away from American assets.

Economic data and sectoral moves in focus

On the economic data front, figures released on Friday showed that German retail sales fell by 1.1% in April compared with the previous month, indicating some weakness in Europe’s largest economy.

Investors are also keenly awaiting Germany’s May inflation figures, due later in the day, as these could provide crucial clues regarding the European Central Bank’s upcoming policy decision next week.

Sectoral performance was mixed in early trading. Basic resources stocks were the biggest drag on the STOXX 600, falling 0.9%, largely due to lower copper prices.

Conversely, the real estate sector offered some support to the main index, rising by 0.8%.

In corporate news, British insurer and asset manager M&G saw its shares jump by an impressive 8.2%.

This surge followed the announcement that Japanese life insurer Dai-Ichi Life Holdings will acquire a 15% stake in M&G as part of a strategic deal, signaling confidence in the UK-based firm.

US markets absorb fresh tariff uncertainty

The renewed uncertainty surrounding US tariffs also cast a shadow over Wall Street. US stock futures edged lower as markets digested the implications of a federal appeals court decision on Thursday to temporarily pause a trade court ruling that had, just the day before, blocked many of President Trump’s tariffs as illegal.

This pause grants the appeals court time to consider the case, with the Trump administration required to file its briefings by June 9.

Futures attached to the Dow Jones Industrial Average slipped 0.1%, while futures for the benchmark S&P 500 fell 0.2%. Futures linked to the tech-heavy Nasdaq 100 dropped 0.3%.

The White House has indicated its preparedness to take the tariff dispute to the Supreme Court if necessary.

In the interim, it is reportedly exploring alternative methods to implement President Trump’s tariffs without relying on emergency powers, the use of which was central to the initial court’s decision to block them.

Later on Friday, Wall Street’s attention will shift to the April reading of the Federal Reserve’s preferred inflation gauge, the Personal Consumption Expenditures (PCE) Price Index.

Market participants will be highly focused on any indications that tariffs might be putting upward pressure on inflation, although many analysts do not expect the levies to significantly impact the data until the following month.

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Elon Musk is diving back into his companies, declaring a renewed, round-the-clock focus on Tesla, SpaceX and his AI venture xAI, just as each prepares for high-stakes moves that could shape their futures.

On Wednesday evening, Musk announced he was stepping away from his role at the Department of Government Efficiency (DOGE), a four-month initiative aimed at cutting federal spending by up to $2 trillion—a target that has so far seen only modest progress.

“Back to spending 24/7 at work and sleeping in conference/server/factory rooms,” the billionaire wrote on X last Saturday.

The pivot comes at a time of mounting operational and reputational challenges for Musk’s empire.

While some conservative policymakers continue to view Musk’s involvement as a symbolic victory for budget hawks, others in the business world, including Musk, have acknowledged that his political engagements have hurt his businesses.

From Tesla’s sliding sales to SpaceX’s Mars ambitions and the AI arms race heating up against OpenAI and others, the workload is immense — and the stakes are higher than ever.

At Tesla, Robotaxi launch, falling Europe sales a priority

At Tesla, Musk’s renewed involvement comes as the company nears the launch of its long-promised robotaxi service in Austin, Texas.

The service is expected to debut next month, and Musk recently highlighted road tests of self-driving Model Y vehicles operating without anyone in the driver’s seat, stating there had been “no incidents.”

Tesla is betting heavily on autonomy to counteract falling sales and eroding market share.

In the US and Europe, Tesla deliveries have slumped in recent months, with European sales declining for a fourth straight month in April.

For the first time, Chinese rival BYD overtook Tesla in sales.

While Tesla remains the largest EV maker in the US, investor confidence has wavered, not least because of Musk’s increasingly political profile.

His role in the DOGE, and $300 million in Republican campaign donations have fuelled buyer backlash and added volatility to Tesla’s stock.

During Musk’s absence this spring, the Tesla board reportedly initiated informal talks with executive search firms to plan for potential CEO succession, though the company has denied any formal search process.

Tesla chair Robyn Denholm said the board remains confident in Musk’s leadership and emphasized a renewed focus on the company’s “exciting growth plan.”

Investors have reacted positively to Musk’s return.

Tesla’s market capitalization, which had plummeted after Trump’s election and Musk’s increasing political involvement, has rebounded above $1 trillion on the news.

SpaceX pursues Mars as setbacks mount

Musk’s other major undertaking, SpaceX, is trying to prepare for what could be its most ambitious mission yet: a Mars-bound test of its Starship spacecraft in 2026.

That year presents a rare orbital opportunity, when Earth and Mars will be at their closest.

But serious technical challenges persist.

Earlier this year, two Starship prototypes exploded in flight.

The most recent test flight failed to deliver on a critical objective: testing the spacecraft’s heat-protective tiles during atmospheric reentry.

SpaceX lost contact with the vehicle before the tile system could be assessed.

Despite setbacks, SpaceX retains strong government ties.

Its partially reusable Falcon rockets continue to carry out missions for NASA and the Pentagon.

On Friday, SpaceX is scheduled to launch a GPS satellite for the US military.

The company’s Starlink satellite internet network, with over 7,500 satellites in orbit, has become another vital business line — one that has earned it increasing favour from US intelligence agencies.

Intense rivalry between xAI and OpenAI another frontier

Musk’s attention is also shifting toward artificial intelligence, a field he has long warned could pose existential risks.

His AI startup, xAI, recently merged with X (formerly Twitter) in a bid to pool resources and accelerate the development of artificial general intelligence — what he calls “digital superintelligence.”

The combined entity has introduced Grok, a chatbot that Musk claims will surpass competitors.

The company is working on high-profile partnerships to extend Grok’s reach, including a potential collaboration with Microsoft.

However, efforts to secure a place in a major Middle East AI deal were unsuccessful, The Wall Street Journal reported.

Musk’s return to xAI signals a sharpening rivalry with former partners at OpenAI, which he co-founded but later criticized for being too aligned with corporate interests.

Neuralink and Boring Company progress slowly

Beyond Musk’s primary focus areas, his other ventures are making slow but notable progress.

Neuralink, now led by Shivon Zilis, is entering a new phase of clinical testing in the Middle East aimed at patients with motor and speech impairments.

The brain-implant startup has already implanted chips in at least three paralyzed patients who can now interact with computers using their thoughts alone.

Meanwhile, The Boring Company, under longtime Musk deputy Steve Davis, is working on a proposed 68-mile tunnel system in Las Vegas.

While the company has been unable to break ground on major projects elsewhere, the Las Vegas system is gradually expanding.

Davis, like Musk, also stepped down from DOGE this week.

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