USA
- Thursday’s session on Wall Street began with heavy declines, at times nearing 3% on the NASDAQ 100. Selling pressure eased over time, and losses were reduced to around 1% on the major indices. US500 is down about 0.6%, and US100 is down 1%. US30 and US2000 are performing better, with valuations up around 0.2%.
- The clear divergence between indices points to a concentrated nature of market concerns. The focal point is hyperscale and SaaS companies; it is negative for the broader market’s pricing that these companies account for more than half of the main indices.
- JPMorgan also points to deleveraging by retail investors; this move is particularly intense in technology stocks.
- The market considers the conflict in Iran to be practically over, which is reflected in prices. Work is ongoing to sign a final agreement, with both sides having time until August 21.
- Micron (MU.US): The memory manufacturer posted phenomenal results; the stock is up 20% at the open, reduces growth to 10% as the trading procedes.
- The company generated USD 41.46 billion in revenue and EPS of USD 25.11, representing an increase of over 100% versus the previous quarter and coming more than a dozen percent above the median market expectations. The strong results are also supporting other producers in the sector.
- A potential issue is that further hyperbolic increases in memory prices signal growing pressure on the investment budgets of hyperscale companies, which weighs on the broader market.
- Euphoric sentiment toward semiconductors is also boosting Qualcomm, which is forecasting USD 15 billion in data-center segment sales, lifting the stock by 8%.
- BlackBerry (BB.US): The company released optimistic year-end guidance, with revenue expected to be supported by infrastructure spending. The stock is up 7%.
- Wendy’s (WEN.US): The company continues rebounding from valuation lows on a wave of retail buying, amid optimism about the future performance of a new “meme stock.” The stock is up about 10%.
- IBM (IBM.US): The company demonstrated the first prototype chip using sub-1nm technology.
- Apple (AAPL.US): The company raised product prices, citing major shortages of memory chips, for which consumer electronics must compete with AI data centers. The market sees potential margin pressure and/or lower sales; the stock is down about 5%.
- PCE inflation rose to 4.1%, in line with market expectations. This should not dramatically affect the priced-in rate path in the US. It is worth noting that core PCE inflation is not only significantly lower, but also stabilized earlier, which may imply the price increase is temporary.
- Economic growth surprised to the upside: US GDP (Q1) rose 2.1% versus the expected 1.6%.
- Wages and personal spending also rose by 0.7%.
- Jobless claims stayed above 200k, but came in below expectations.
- Concerns may relate to consumer spending and durable goods orders, which were clearly below expectations.
- European indices are posting moderate gains, driven mainly by rapidly falling oil prices. Gains range from 0.5% to 1.2%, with Germany leading. DE40 is up more than 1.2%.
- Semiconductor sentiment is also spilling over into Europe. ASML Holding and Infineon Technologies are rising clearly, up about 3%.
- Spain’s economic growth came in at 2.7% y/y, in line with market expectations.
- In the FX market, the pound is leading gains. This follows the priced-in path of a transfer of power after Keir Starmer’s resignation. Andy Burnham is the favorite. The pound is strengthening by about 0.2% versus the dollar and the yen.
- New Zealand and Australian currencies are also gaining after a surprising rise in employment in Australia. The Australian dollar and New Zealand dollar are up about 0.2% against the USD.
- Among agricultural commodities, cocoa is posting strong gains. The nearly 5% rise is driven by concerns over the next harvests in West Africa.
- Energy commodities are seeing slight gains; oil is up 2%. Despite Iraq’s threats to leave OPEC to increase production, another large drop in US oil inventories offsets that impact. Brent returns to USD 75 per barrel.
- Solid US economic data is supporting industrial metals; copper is up 2%. Among precious metals, silver is up more than 1%.
- The cryptocurrency market is showing increasing signs of weakness and/or a possible breakdown.
- Bitcoin falls below USD 60,000.
- Ethereum loses more than 3% and drops to around USD 1,560.
- Solana falls to USD 66.
IBM shows a breakthrough: Leader of the next revolution?
Apple Price Hikes: Memory costs weigh on the company’s and markets
Micron earnings: Is perfection not enough anymore?
US OPEN: Micron is not enough, Wall Street deepens declines
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.
