- Chip stocks continued to drive positive sentiment, pushing most U.S. stocks higher on Monday, with the Nasdaq Composite Index leading the gains. Despite growing concerns about a tech bubble ahead of earnings season, expectations of a significant profit increase for Samsung and SK Hynix's plan to launch a U.S. IPO further supported risk appetite in the AI sector.
- In the energy market, with stable shipping through the Strait of Hormuz and OPEC+ agreeing to increase production by 188,000 barrels per day starting in August, Brent crude prices held near $72.14 per barrel after recovering early losses, reflecting that the expectation of increased supply has mitigated geopolitical premiums.
- In the foreign exchange and macro policy arena, the dollar approached a 40-year high against the yen, as the market awaited the first meeting minutes under the new Federal Reserve Chairman Kevin Warsh. Traders widely expect the new management to reduce forward guidance, with macro funds showing restraint ahead of key economic data.
Steady Buying in Chip Sector Tests Tech Stock Valuations with Liquidity
Boosted by continued bullish sentiment in chip stocks, the Nasdaq Composite Index surged 1.29%, and the S&P 500 Index rose 0.67%. Despite Microsoft's (MSFT) announcement of laying off about 4,800 employees to optimize costs, SK Hynix (000660) plans to raise $28 billion through a U.S. listing, coupled with expectations of a significant profit increase for Samsung Electronics, offsetting concerns about an AI bubble, with funds continuing to concentrate upstream in the semiconductor supply chain.
Supply Increase Expectations Mitigate Geopolitical Premiums, Oil Market Returns to Fundamentals
Brent crude futures recently reported at $72.14 per barrel. Although peace talks between the U.S. and Iran have stalled, shipping through the Strait of Hormuz remains unimpeded, with a total of 160 vessels passing safely last week. Meanwhile, OPEC+ member countries have agreed to further increase daily production targets by 188,000 barrels starting in August. The expectation of capacity release on the supply side effectively mitigated the geopolitical risk premium, leading to a stable overall trend in oil prices after recovering early losses.
Yen Under Pressure Testing Intervention Limits, Market Focuses on Warsh's First Meeting Minutes
The dollar index rose 0.24% to 101.11, while the dollar-yen exchange rate increased 0.6% to 162.35 yen, once again approaching a 40-year historical low. Forex speculative funds are continuously testing the Japanese Ministry of Finance's resolve to intervene in the currency market. As the Federal Reserve is set to release the first FOMC meeting minutes since Kevin Warsh took office this Wednesday, the market widely expects a decrease in policy guidance clarity, with cross-asset investors generally turning cautious ahead of the policy reassessment period.
European Stocks Retreat from Highs, Gold Under Pressure, Earnings Season Intensifies Bull-Bear Battle
The European STOXX 600 Index retreated 0.6% after hitting an intraday record high due to selling pressure at high levels, while the MSCI Global Stock Index edged up 0.18%. Meanwhile, spot gold prices fell 0.8% to $4,141.53 per ounce, giving back some of last week's gains. The volatile performance across multiple asset classes indicates that as earnings reports from major stocks like Delta Air Lines (DAL) and PepsiCo (PEP) are set to be released this week, global risk appetite is showing defensive characteristics ahead of a new round of earnings tests in U.S. stocks.
