As signs in Washington point to a final agreement on raising the country’s debt ceiling, the thinking on Wall Street is that any euphoria from such a deal may already have occurred, or will prove short-lived during the four abbreviated trading days next week. Likewise, once the immediate euphoria surrounding Nvidia’s second-quarter outlook and enthusiasm for all things AI wears off, attention will turn to next Friday’s reading of May’s nonfarm payrolls (the estimate compiled by Dow Jones sees 188,000 new jobs), and the Fed’s upcoming policy meeting. Fed on June 13-14 and the inconvenient fact that many stocks fail to take off. The final fear in trading rooms is that the economy has proven resilient recently, with inflation only slowly declining, the Fed may raise interest rates another quarter point, if not at the June meeting, then at the next meeting on July 25-26. The Atlanta Fed’s GDP Now model estimate for real GDP growth for the second quarter recently came in at 1.9%, while a CME FedWatch tool late Friday showed a roughly 67% chance that the Fed will raise another quarter point in June and raised the federal funds rate to 5.25% to 5.50%. There is even a 25% chance that the rate will be from 5.50% to 5.75% by the end of the July meeting, according to the Chicago Mercantile Exchange. Some of the move may be related to sentiment over the debt ceiling discussions. June tops it all off, and it’s usually a lousy month for stocks anyway, Washington machinations or Fed tea leaf speculation aside. “The reason June is usually such a soft market is the fact that we are going through the first quarter earnings season, which means companies are relatively quiet, leaving investors dependent on mostly political news, which is usually a risk to the market,” said Jay Hatfield, president. CEO of Infrastructure Capital Management.” Market Backlog This Year [are] Debt ceiling negotiations, the Fed’s hawkish suspension, and the banking crisis. It looks like we are going to get a debt ceiling deal over the weekend, which should help the market to stabilize. The problem for many on the street is the action in the S&P 500 Tech, which is up more than 5% this week; the Nasdaq Composite, up about 2.5%; and the S&P 500, up 0.3%, hiding plenty of weakness below the surface. The S&P 500 Consumers, Materials, Health Care and Utilities Index are all down between 2.4% and 3.2% this week, and the Dow Industrials are down 1%.Although the S&P 500 is up 9.5% so far in 2023, However, only a few stocks are doing well.” The number of stocks trading above 200 today is that the moving average has been declining since mid-April, Liz Young, head of investment strategy at SoFi, wrote in a blog post on Thursday. “Despite the market’s uptrend over the past month and change, the strength below the surface has actually deteriorated.” It all comes at a seasonally fraught time of year for stocks, regardless of historical performance [in June] was tepid to [the] DJIA and the S&P 500, stock almanac Christopher Mistal wrote this week, though he noted that performance in years like these, before presidential election years, tended to be stronger. However, June ranks historically as only the 11th strongest month of the year for the Dow, the ninth strongest for the S&P 500 and Russell 1000 and the seventh strongest month for the Russell 2000,” says the calendar. Unfortunately, the market background remains “cautious.” And it remains ripe for more sideways movement and a potential pullback or correction during the weak summer months, especially after mid-July to the two worst months of the year — August and September, almanac editor-in-chief Jeffrey Hirsch wrote Thursday. Next week’s calendar Tuesday 9 a.m.: S&P/Case-Shiller Home Price Index (March) 10: a.m.: Consumer Confidence (May) Earnings: HP Inc. , Hewlett-Packard Enterprise Wednesday 8:45 a.m.: Fed Chair Michele Bowman speaks 9:45 a.m.: Chicago PMI (May) 10 a.m.: Golts (April) 1:30 p.m.: Fed Governor Phillip speaks JEFFERSON 1:30 p.m.: Philadelphia Fed President Patrick Harker talks about earnings: Advance Auto Parts, Salesforce, NetApp, Raymond James, Donaldson, Capri Holdings, Nordstrom, PVH Corp., CrowdStrike, Okta Thursday 8:15 a.m.: ADP Special Payrolls Report (May) 8:30 am: Initial Claims (week ending May 27) 9:45 am: S&P Global Manufacturing PMI (May) 10 am: ISM Manufacturing (May) 1 Noon: Fed’s Harker Talks Earnings: Dollar General, Broadcom, Cooper Companies, Paychex, Macy’s, Five Below, C3.ai, Lululemon, Zumiez Friday 8:30 a.m.: US Jobs Report (May) – Contributed to this report CNBC’s Samantha Sobin, Fred Imbert, and Michael Blum.