Fixed Income Market Overview
U.S. Treasury bond yields remained stable on Wednesday following Federal Reserve Chair Jerome Powell’s caution that prolonged elevated interest rates could impede economic growth. The 10- year Treasury yield slightly decreased to 4.278%, while the 2-year note yield held steady at 4.626%. Powell highlighted the ongoing strength of the economy and labor market but stressed the need to balance inflation control with economic activity. His remarks came during a two-day testimony on Capitol Hill, where he reaffirmed the Fed’s commitment to the 2% inflation target. Investors are now focused on upcoming key economic indicators, including the June consumer price index and the producer price index, which are critical for assessing the potential for future rate cuts.
Bank of England chief economist points to ‘persistence’ of underlying inflation.
Baidu Surges With Bullish Options as Robotaxi Orders Climb.
U.S. oil rises to $82 per barrel as inventories fall, OPEC sees solid demand.
Italy’s government not involved in UniCredit’s ECB lawsuit, source says.
AMD to Buy European AI Lab Silo in Race Against Nvidia.
Major Indicies
| Symbol | Price | Change | %Change |
|---|---|---|---|
| DJIA | 39,721.36 | 429.39 | 1.09%↑ |
| NASDAQ | 20,675.38 | 222.36 | 1.09%↑ |
| S&P 500 | 5,633.91 | 56.93 | 1.02%↑ |
| NIKKEI | 41,831.99 | 251.82 | 0.61%↑ |
| HSI | 17,471.67 | -51.56 | -0.29%↓ |
| VIX | 12.85 | 0.34 | 2.72%↑ |
Bonds
| Name | Yeild | CHG |
|---|---|---|
| US 10-YR | 4.29% | -0.01 |
| US 30-YR | 4.49% | 0.00 |
| US 5-YR | 4.25% | 0.00 |
| JPN 10-YR | 1.09% | 0.01 |
| UK 10-YR | 4.13% | -0.03 |
Futures & Commodities
| Name | Last | Change | %Change |
|---|---|---|---|
| WTI CRUDE | 82.10 | 0.69 | 0.85%↑ |
| NAT GAS | 2.345 | -0.015 | -0.64%↓ |
| GOLD | 2,379.70 | 11.80 | 0.50%↑ |
| SILVER | 31.01 | -0.04 | -0.14%↓ |
| COPPER | 4.609 | 0.031 | 0.68%↑ |
Equity Market Overview
TSMC
Taiwan Semiconductor Manufacturing Co. (TSMC) reported robust second-quarter revenue growth, driven by high demand for AI applications. The revenue reached T$673.51 billion ($20.67 billion), surpassing market forecasts of T$654.27 billion. This represents a 32% year-on-year increase from $15.68 billion. TSMC’s growth has been fueled by clients like Apple and Nvidia, despite a decline in pandemic-driven demand. The company’s shares, trading at historic highs, have risen 76% this year. TSMC is scheduled to report detailed second-quarter earnings and future outlook on July 18, with expectations of a 30% rise in net profit.
Volkswagen A G
Volkswagen shares declined after issuing a profit warning and considering closing an Audi plant in Brussels due to weak demand for the Audi Q8 e-tron. The company reduced its operating return on sales forecast to 6.5%-7% from the previous 7%-7.5%. The potential closure would affect 3,000 employees and could cost up to €2.6 billion in 2024. Analysts see this as a positive restructuring step but highlight Audi’s lag behind competitors due to delays in new models. Volkswagen’s overall deliveries dropped 3.8% year-onyear, with significant declines in China but growth in Western Europe and North America. The company will report its second-quarter results on Aug. 1.
Microsoft
Microsoft will relinquish its observer seat on OpenAI’s board amid regulatory scrutiny over generative AI in Europe and the U.S. Microsoft’s deputy general counsel, Keith Dolliver, stated that while the seat provided insights, it is no longer needed due to progress made by OpenAI’s board. The European Commission is investigating the Microsoft-OpenAI partnership for potential antitrust issues, although it concluded the observer role did not affect OpenAI’s independence. The UK’s Competition and Markets Authority still has concerns. Microsoft originally took the seat in November after investing heavily in OpenAI, now totaling $13 billion. Regulatory focus on big tech’s influence over AI providers likely influenced Microsoft’s decision.
