Trump Says Iran Ceasefire Is “Over.” Are Fed Rate Hikes Back On the Table?
Overnight, market odds of a Fed rate hike at the December meeting jumped from 48% to 57%, reflecting renewed inflation fears from rising oil. The change in rate expectations was just as notable. Betting markets priced the odds of a Federal Reserve rate hike at its December meeting at 48% yesterday. By this morning, those odds had climbed to 57%, reflecting investors' reassessment of inflation risks. According to the latest data from the U.S. Bureau of Labor Statistics, consumer prices rose 4.2% year over year, with higher gasoline and other energy costs becoming the primary contributor to inflation.
The Trade Deficit Just Blew Out to $77.6 Billion. Are the Tariffs Even Working?
The May trade deficit surged to $78 billion, the second-worst figure since 1992, as exports fell 3% and imports rose 3% simultaneously. Tariffs generate $29 billion monthly but failed to curb import volumes in May, making June's deficit print the decisive test of whether the policy works. The May U.S. trade deficit came in at negative $77.6 billion, a jarring jump from April's negative $54 billion and the widest monthly gap since March 2025. Close to consensus, sure. But this is the second-worst monthly print in a data series that goes back to 1992, and it lands in a policy environment where tariffs were supposed to be pulling the gap the other way. From January through April 2026, the monthly trade deficit had been parked in the mid-$50 billion range. That was, if you squinted, evidence for the tariff thesis. Then May happened. The mechanical story is simple. Exports fell just over 3% while imports rose just over 3%. When both blades of the scissors move against you at the same time, the gap yawns open. For context, the all-time high since 1992 was negative $132 billion in March 2025, so we are not there. But we are closer to that record than to the boring baseline that held for the first four months of the year. The monthly goods and services balance feeds directly into GDP, and a wider deficit is a mechanical drag on the growth print. It also pressures the dollar, since a country importing more than it exports is, in effect, sending more currency out than it takes in. Bond desks watch it because a weaker dollar can leak into imported inflation, and equity desks watch it because industrials with export exposure lose earnings power when foreign buyers pull back.
No Forward-Looking Guidance Needed: Fed Chair Kevin Warsh Just Dropped an Unmistakable Clue About Interest Rates
BREAKING: US May PCE inflation, the Fed's preferred inflation metric, rises to 4.1%, the highest reading since April 2023. Core PCE inflation rose to 3.4%, its highest since October 2023. US inflation is now officially running at more than double the Fed's 2% target.
A Positive Outlook as Q2 Earnings Season Gets Underway
Total Q2 earnings for the S&P 500 index are currently expected to be up +24.0% from the same period last year on +11.3% higher revenues, with 11 of the 16 Zacks sectors expected to enjoy positive earnings growth. The Tech sector has been a critical growth pillar since 2023 Q3 and is expected to continue playing that role in 2026 Q2, with expected earnings growth of +48.5%. Excluding the Tech sector's substantial contribution, Q2 earnings growth for the rest of the S&P 500 index would be +12.2% (vs. +24.0% otherwise). Q2 earnings for the 'Magnificent 7' group of companies are expected to be up +28.5% from the same period last year on +24.4% higher revenues. Excluding the 'Mag 7' contribution, Q2 earnings for the rest of the index would be up +22.5% (vs. +24.0%). JPMorgan is expected to earn $5.49 per share on $48.7 billion in revenues in Q2, representing year-over-year changes of +10.7% and +8.5%, respectively. Total Q2 earnings for the Zacks Investment Banks/Managers industry, of which JPMorgan, Bank of America, Citigroup and Wells Fargo are a part, are expected to increase by +11.1% from the same period last year on +11.4% higher revenues, as the table below shows. For context, loan growth has trended below historical averages over the past three years, but the growth pace began improving in 2025, and the trend continued into 2026 Q1. The favorable outlook for loan portfolios bodes well for net interest income in Q2 and beyond, even though the yield curve lost some of its steepness in Q2. The Finance sector is the second largest earnings contributor to the S&P 500 index, behind only the Tech sector, accounting for 16.4% of the index's expected forward 12-month earnings. Full-year 2026 earnings estimates have increased for 11 of the 16 Zacks sectors since the start of March, with the most pronounced gains at the Energy, Basic Materials, Tech, Industrials, Utilities, and Business Services sectors.
JPMorgan sees the writing on the wall for silver stock investors
Silver rose more than 130% in 2025. It hit an all-time high of $121.78 an ounce on Jan. 29, 2026. Solar panels needed it. Electric vehicles needed it. AI data centers needed it. BloombergNEF estimates silver demand from solar installations will fall to roughly 194 million ounces in 2026, a 7% year-on-year drop, even as global solar capacity keeps growing by around 15%. As TheStreet reported, the Silver Institute expects global silver industrial fabrication to decline about 2% in 2026 to a four-year low. JPMorgan cuts silver price forecast to $60-$65 an ounce Gregory Shearer, head of Base and Precious Metals Strategy at JPMorgan, now sees silver averaging $60 to $65 an ounce through the rest of the year, according to Reuters. That is a significant cut from the bank's earlier call of $81 an ounce for the full year, with a Q4 high of $85. ING commodity analyst Ewa Manthey lowered the bank's forecast in June, citing slowing solar demand, higher yields, a stronger dollar, and weaker investor flows. ING now sees silver at $68 an ounce in the third quarter and $74 in the fourth, down from a previous Q4 estimate of $84. JPMorgan's own Marko Kolanovic has warned silver could fall back to $50 if speculative positioning unwinds before fundamentals can catch up.
Crypto and stocks tumble after Trump declares ceasefire 'over' following Iran strikes
Derivatives positioning - Despite bitcoin's slide to $62,000, it's still up 6% this month and there is some good news on the derivatives front: Traders don't look to be shorting the rally. Open interest (OI) in futures has dropped to 730K BTC from over 740K BTC a day ago. - Ether is not faring so well. Open interest has held steady at around 13.95 million tokens despite the spot-price drop triggering liquidations of bets worth $90 million. BTC 24-hour liquidations tally just over $100 million. - The sell-off in Canton Network's CC token has accelerated, with the token's price slipping to its lowest level since January just as futures open interest rises to a two-week high. This combination points to the possibility of traders shorting the decline, especially since funding rates remain deeply negative, close to -20%. - Broadly speaking, the bear grip has tightened across major cryptocurrencies, including BTC and ETH, as indicated by their negative 24-hour OI-adjusted cumulative volume delta. A negative reading indicates that price action is being driven by traders placing market orders rather than passive limit orders. - The latest decline in BTC and ETH seems to have spurred hedging demand for options, as their respective 30-day implied volatility indexes, BVIV and EVIV, are up for the second straight day. - Options skew on Deribit confirms that. The one-week skew has jumped to nearly 20% in favor of puts from 16% a day ago. Puts offer protection against a price slide in the underlying asset, in this case, BTC. The same is true for ether. - However, 24-hour volume figures show the highest activity in BTC call options at the $80,000 strike price. Stablecoin market cap fell to $312B in June, its largest monthly drop since TerraUSD, while tokenized equity volumes surged 145% to a record $3.86B.
Bitcoin tumbles back to key $60K support level: What’s behind the sell pressure?
Traders are currently pricing 69% odds of interest rate hikes by September, up from 42% one month prior. This environment weighs heavily on risk assets, with Bitcoin still not widely perceived as an effective hedge. The latest round of Bitcoin sales, totaling $216 million, announced by Strategy (MSTR US) on Monday, negatively surprised many after it was revealed that they occurred outside the core $1.25 billion Monetization Program.
Micron Stock: A Different Cycle, For Better Or For Worse
Micron (MU) stock has surged nearly 8x over the past year, pushing its market capitalization above $1 trillion. Historically, memory has been one of the semiconductor industry's most cyclical businesses, with DRAM moving through boom-and-bust cycles every three to four years. HBM is no longer a commodity memory product. Unlike traditional DRAM, which plugs into separate memory slots, HBM is packaged directly alongside the AI accelerator using advanced chip packaging. It is co-designed and qualified for a specific GPU generation, with much longer qualification cycles than commodity DRAM. Since the HBM is inseparable from the GPU package, each new accelerator generation typically brings a new generation of HBM as well. That changes Micron's customer mix. Instead of selling memory to hundreds of PC makers, server OEMs, and cloud providers, HBM demand is concentrated among Nvidia, AMD, and a handful of hyperscalers developing their own AI chips. The long qualification cycles work in Micron's favor. Once a memory supplier is qualified for a GPU platform, customers are reluctant to switch because validating a new supplier can take years, not quarters. That creates higher switching costs and greater revenue visibility. The flip side is customer concentration. A slowdown in AI infrastructure spending by even one major GPU customer or hyperscaler could have an outsized impact on Micron's HBM revenue. In previous memory cycles, weakness in one end market was often offset by demand from others. With HBM, that cushion is much smaller. What's Genuinely New: Take-or-Pay Contracts The strongest argument that this cycle could be different is something the DRAM industry has rarely had before: long-term take-or-pay agreements. Micron has signed 16 multi-year take-or-pay agreements. Once all planned agreements are finalized, the company expects more than half of its revenue to be backed by these contracts, with about 40% covered by fixed or ceiling pricing. See Micron growth and margins vs. peers
Broadcom’s $200 Billion AI Opportunity Is Drawing New Interest From Investors
$56 billion in AI semiconductor revenue for fiscal 2026, up roughly 180% from fiscal 2025, and reiterating AI semiconductor revenue in excess of $100 billion in fiscal 2027. Q2 bookings for AI semiconductors were over $30 billion against the $10.8 billion shipped, roughly three times coverage in a single quarter. Six core customers now have multi-year, multi-gigawatt commitments: a long-term TPU and AI networking agreement with Google, 5 additional gigawatts of TPU-based compute for Anthropic beginning in 2027, 1.3 gigawatts contractually committed to OpenAI in 2027 within a 10-gigawatt agreement by 2029, and 3 gigawatts for Meta through the end of 2028. Importantly, Tan said visibility now extends into 2028. Broadcom stock has not celebrated the news above. Shares of AVGO stock traded at $495.00 at the Q2 filing on June 3, 2026, and closed at $360.45 on July 2, 2026. That is a one-month change of -25.03%. However, year to date, AVGO stock is still up 4.53%, and up 34.53% over one year and 745.73% over five years. Broadcom’s bull argument rests on a simple gap, in that the company’s pipeline is expanding faster than the stock is willing to price. In the second quarter, Broadcom delivered a record operating margin of 67% and free cash flow of $10.262 billion, or 46% of revenue. Net income rose 87.51% YoY to $9.310 billion, cash and equivalents sit at $19.628 billion, up 107.22% YoY, and AI is now a scale business inside Broadcom, with AI semiconductors representing 49% of total consolidated revenue and networking accounting for roughly 40% of Q2 AI revenue. Tan also flagged a $35 billion first tranche of an AI XPU platform with Apollo and Blackstone intended to deploy more than 20 gigawatts of compute through 2027.
Chip titan SK hynix to set price for mega US listing
SK hynix is expected on Thursday to set the price for its mega US listing that could be one of the world's largest stock sales. As governments and tech firms race to build data centres to train and run artificial intelligence, SK hynix -- a supplier to industry behemoth Nvidia -- has seen profits and its share price skyrocket. SK hynix said this week it hoped to raise a whopping 43 trillion won ($28 billion) by selling American Depositary Receipts (ADRs), which allow shares of foreign companies to be traded on US exchanges. That goal was revised down from an initial target of more than 45 trillion won, but recent volatility in the company's shares make firm estimations difficult. SK hynix is already traded on Seoul's Kospi index, where its market capitalisation soared past $1 trillion in May. Samsung, SK hynix and Micron dominate the global market for the advanced components known as high-bandwidth memory (HBM), used in AI servers alongside other data-crunching semiconductors.
Tesla (TSLA) Lands $9 Billion In Megapack Orders And Expands Home Energy Push
Tesla (NasdaqGS:TSLA) has reported over US$9b in new Megapack energy storage orders tied to utility scale projects.
Meta builds first Canadian data center in Alberta for $9 billion
Meta broke ground Wednesday on its first data center in Canada, a 1-gigawatt facility in Sturgeon County, Alberta, that represents an investment of roughly $9 billion (CAD $13 billion), the company said. Alberta has drawn up to CAD $200 billion in prospective data center investment.