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Stocks approach records after soft inflation cools Fed hike bets
Risk appetite improved as softer inflation and weak consumer data reduced expectations for further Fed tightening, although long-end supply and persistent oil disruption risk limited the bond rally. AI infrastructure demand stayed robust, but increasingly complex financing guarantees made leadership more selective and left Nvidia volatile.• Macro/Rates: July CPI and PPI undershot expectations, and retail sales and consumer sentiment weakened. Equities moved toward records, the dollar hit its lowest level since May, and short yields fell, but a costly 30-year auction and looming 20-year supply kept duration under pressure.• Oil/Iran: Brent rose roughly 5% Monday and remained near $89 as blockade threats, tanker damage and sharply reduced Hormuz traffic sustained an inflationary risk premium. Diplomatic reports and a 17.4 million-barrel US inventory build produced sharp reversals without resolving supply concerns.• AI/Financing: Strong cloud growth, compute contracts and data-center spending lifted RIOT, SMCI, CRWV and industrial suppliers. Nvidia's proposed $500 billion financing framework drew mounting scrutiny as reported guarantees narrowed, and the stock ended the week pressured by chip-backed lending concerns.• Corporate Catalysts: Workday surged on Silver Lake takeover talks, Reddit rallied on S&P 500 inclusion, and PayPal gained on sale discussions. Intel remained weak after expanding its discounted equity offering to $20 billion, while Cisco fell on disappointing margin guidance.
Nvidia falls on lending concerns while copper nears record
Company-specific weakness and Hawaii’s worsening disruption dominated US news flow before late global trading shifted attention to commodity scarcity and rising Japanese yields. Nvidia’s decline revived concerns about financing the AI buildout, while tight copper supply and Hormuz uncertainty supported resource exposures. Heavy Treasury supply kept duration risk elevated.• Nvidia/AI: Nvidia fell 3% as investors questioned chip-backed lending structures, putting financing risks around expensive AI infrastructure back in focus.• Copper/Supply: LME copper approached a record as the cash-to-three-month backwardation widened to $478 a ton, the most since 2021. Korea Eximbank also offered Glencore $1 billion for supply access.• Rates/Supply: Wednesday’s $16 billion 20-year Treasury auction was expected to price near 5.27%, the highest yield since the maturity returned in 2020.• Oil/Hormuz: Brent edged up to $88.72 after a report that Iran’s Revolutionary Guard blocked a proposed deal to reopen the Strait of Hormuz.• Japan/Rates: Japan’s 10-year yield rose to 2.93%, its highest since 1996, as swaps priced an 80% chance of a BOJ move by September despite soft growth.• Hawaii/Utilities: Outages exceeded 200,000 and two hospitals switched to emergency power as flooding impeded fuel deliveries, deepening operational risk for Hawaiian Electric.
Japanese yields hit 1996 high as copper approaches record
Japan’s rate outlook diverged from soft growth, while tight copper supply and renewed Hormuz uncertainty shaped cross-asset risk.• Japan/Rates: The 10-year JGB yield rose 5.5 basis points to 2.93%, its highest since 1996, despite second-quarter growth missing forecasts at 1.1% annualized. Swaps priced about an 80% chance of a BOJ move by September; the Nikkei gained 0.5%.• Copper/Supply: LME copper approached a record as the cash-to-three-month backwardation widened to $478 a ton, the largest since 2021. Korea Eximbank separately agreed to lend Glencore $1 billion in exchange for copper supply.• Oil/Hormuz: The Wall Street Journal reported that Iran’s Revolutionary Guard blocked a proposed Hormuz reopening deal. Brent was 0.2% higher at $88.72.• Alibaba/Deals: Alibaba agreed to sell Lingxi Games to Trustar Capital in a transaction reportedly valuing the unit above $1.5 billion, advancing its AI focus.
Hawaii outages top 200,000 as Trump curtails South Korea military drills
Weather disruptions intensified in Hawaii, while Treasury supply and company-specific financing concerns added risk across utilities, bonds and technology.• Hawaii/Utilities: Power outages climbed above 200,000, and two hospitals shifted to emergency power. Flooding impeded fuel deliveries, while officials reported no confirmed storm deaths.• US/South Korea: Trump ordered the Pentagon to substantially reduce joint military exercises with South Korea, saying cancellation was too late but the drills would be scaled back.• Rates/Supply: Wednesday’s $16 billion 20-year Treasury auction may price near 5.27%, the highest yield since the maturity was reintroduced in 2020.• AI/Deals: Bloomberg reported that Stripe finalized a deal to buy OpenRouter for more than $7 billion. Stripe called the report rumor or speculation, and neither company confirmed it.• Nvidia: Shares fell 3% as investors questioned chip-backed lending structures.
NATO downs suspected Russian drone over Romania as Israel’s economy rebounds 15.4%
Geopolitical spillover widened into NATO airspace, while Israel’s growth surprise and Hawaii’s improving storm track created a mixed macro backdrop.• NATO/Ukraine: A Spanish F-18 shot down a suspected Russian drone over Romania, the second NATO-airspace interception in three days. Ukraine separately launched more than 600 drones toward Moscow, setting a Wildberries warehouse ablaze.• Israel/Growth: Second-quarter GDP surged 15.4% annualized, nearly double the 8.3% consensus, as exports jumped 35.2%.• Hawaii/Utilities: Lala weakened to a tropical storm and moved away from the Big Island, but a flash-flood emergency remained after two homes were swept away; nearly one-third of the island lacked power.• Autos/Lubricants: Volkswagen, Stellantis and Toyota are qualifying alternative motor oils after Group III base-oil prices nearly tripled to about $4,000 a tonne amid Middle East disruptions.
AI infrastructure spending broadens amid scrutiny of financing guarantees
AI infrastructure spending broadened into industrial suppliers, but investors increasingly questioned the contingent financing behind large data-center projects. Strong corporate earnings supported the equity backdrop, while Hormuz uncertainty and tariff pressure preserved risks for energy, housing and technology supply chains.• AI/Industrials: Caterpillar committed $725 million to generator production, Cummins planned $450 million of investment and Ford earmarked $2 billion for power storage as data-center demand spread beyond chipmakers.• AI/Credit: Investors scrutinized roughly $70 billion of off-balance-sheet guarantees. Nvidia reportedly cut its proposed OpenAI guarantee below $120 billion, while Meta and Broadcom also supported large infrastructure financings.• Earnings: S&P 500 second-quarter earnings increased 31%, exceeding the projected 23% gain, while the full-year profit-growth estimate rose to 27%.• Oil/Hormuz: Iran and Oman neared a shipping-route agreement, but unresolved transit fees, security terms and additional vessel attacks kept supply risks elevated.• Trade/Inputs: Canada said substantial work remained before the Aug. 19 tariff deadline. New US quartz duties threatened housing costs, while Washington pressed Apple to avoid Chinese memory chips.
Hurricane Lala disrupts Hawaii as AI data centers spur manufacturing investment
AI infrastructure spending broadened into industrials, but contingent financing risks grew, while Hurricane Lala disrupted Hawaii.• Hawaii/Utilities: Hurricane Lala’s eyewall neared the Big Island; more than 30,000 customers lost power, both major island airports closed, and 24-hour rainfall approached 17 inches.• AI/Industrials: Caterpillar committed $725 million to generator production, Cummins planned $450 million and forecast $9 billion of 2030 data-center sales, while Ford earmarked $2 billion for power storage.• AI/Credit: Investors are scrutinizing about $70 billion of off-balance-sheet guarantees. Meta backed $28 billion and $13 billion data-center projects, while Broadcom supported Anthropic-linked chip financing.• Energy/Holdings: Thiel Macro disclosed nearly 1.2 million Vista Energy shares worth about $76 million, making VIST its second-largest position.
Iran and Oman near Hormuz accord as S&P 500 earnings growth hits 31%
Geopolitical supply risk remained elevated, while earnings strength and industrial-policy changes supported selected equity themes.• Oil/Hormuz: Iran and Oman neared an agreement on shipping routes, but Tehran said it would not automatically reopen the strait. Transit fees and security remain unresolved as additional vessels were attacked.• US Earnings: S&P 500 second-quarter earnings rose 31%, beating the projected 23% increase. Full-year profit-growth estimates climbed to 27% from 15%.• Quartz Tariffs: The US began collecting 19%-50% tariffs on imported quartz slabs, raising cost concerns for housing and renovation businesses.• Alibaba AI: Alibaba said Qwen models surpassed 3 billion downloads in six months, exceeding download counts reported for Google and Meta models.• India Nuclear: India issued draft rules allowing private companies to own and operate nuclear plants, supporting its 100-gigawatt capacity target for 2047.
Nvidia scales back proposed OpenAI guarantee as Mastercard outage disrupts Australian payments
Company-specific risk dominated, while trade uncertainty remained elevated ahead of next week’s tariff deadline.• Nvidia/OpenAI: Nvidia and OpenAI are nearing financing for a 10-gigawatt Ohio campus, the Wall Street Journal reported. Nvidia’s proposed guarantee fell from $250 billion to under $120 billion, with no deal yet.• Payments: Commonwealth Bank said payments were being restored after a global Mastercard issue caused declines in Australia; Downdetector logged more than 1,900 reports.• US/Canada Trade: Canada said substantial work remains before the Aug. 19 deadline to avert threatened 50% US tariffs, although weekend talks were described as constructive.• Apple/Memory: Commerce Secretary Howard Lutnick said Washington urged Apple not to buy Chinese memory chips. Apple has tested CXMT and YMTC parts for China-market devices, according to people familiar.
Dollar hits May low after retail sales slump
Soft US consumer data weakened the dollar and briefly supported the front end, but the Treasury rally faded as long yields climbed. Energy supply risk remained elevated from Hormuz to Russia, while late trading shifted toward PayPal deal talks and tighter scrutiny of Nvidia’s AI-financing plans.• Macro/Rates: July retail sales fell 0.6% against a 0.1% gain expected, while the control group declined for the first time this year. Michigan sentiment also missed, the dollar touched its lowest since May 29, and the two-year yield briefly fell below 4.10% before long bonds reversed.• Energy/Hormuz: Brent gained nearly 1% after a tanker was damaged near Hormuz. Only 13 vessels crossed Thursday versus more than 130 before the war, while attacks on Russian refineries and Ust-Luga compounded supply concerns.• Nvidia/AI: Nvidia’s proposed guarantee for an Ohio OpenAI campus reportedly fell below $120 billion from $250 billion, reinforcing earlier caveats around its $500 billion financing ambition. The company also disclosed large Intel and SpaceX stakes.• PayPal/M&A: PayPal was in talks to sell itself to Stripe and Advent after rejecting a $60.50-a-share proposal; negotiations continued with no deal assured.
Stripe and Advent pursue PayPal as Jane Street suffers $15 billion July loss
Deal speculation and portfolio disclosures dominated late news, while infrastructure and trading losses raised company-specific risk questions.• PayPal/M&A: PayPal is in talks to sell itself to Stripe and Advent, people familiar said. A July $60.50-a-share proposal was rejected, and negotiations continue at a potentially higher price, with no deal assured.• Trading/Credit: Jane Street lost about $15 billion in July amid AI-stock turmoil and wrong-way China options bets, according to reports citing people familiar. Year-to-date net trading revenue still exceeds $40 billion.• Nvidia/Holdings: Nvidia disclosed stakes worth $30 billion in Intel and nearly $21 billion in SpaceX at June 30.• Berkshire/13F: Berkshire added 48.1 million Alphabet shares and 17.5 million Delta shares, reopened a D.R. Horton stake and exited Constellation Brands.• AI Infrastructure: Energy Transfer delayed a New Mexico pipeline intended to support an Oracle data center to Feb. 1, 2027.
Dollar hits May low after US retail sales post sharpest drop in over a year
Soft consumer data weakened the dollar and near-term Fed tightening bets, but the Treasury rally failed to hold as long yields resumed climbing. Drone makers rallied, while Nvidia’s financing ambition drew fresh caveats.• US Consumer: July retail sales fell 0.6% versus a 0.1% gain expected; control-group sales dropped 0.4%, their first decline this year.• Sentiment/FX: Michigan sentiment fell to 51 from 55.2, below the 54.5 forecast. The dollar touched its weakest level since May 29.• Rates: The two-year yield briefly fell below 4.10%, but long-maturity Treasuries reversed lower in price; September hike odds remained near 30%.• Drones: Unusual Machines rose as much as 28%, while Red Cat, AeroVironment and Kratos advanced following the import tariffs.• Nvidia/Finance: Nvidia’s $500 billion AI-financing target has no deadline or signed deals; guarantees may reach 25% of individual projects.
Oil rises after tanker attack damages vessel near Hormuz
Geopolitical supply risks intensified across energy, metals and agriculture, while premarket earnings reactions remained sharply negative in selected technology names.• Oil/Hormuz: Brent rose nearly 1% to about $88 after an unnamed tanker suffered minor drone damage while leaving the Persian Gulf. The UK naval agency did not attribute responsibility; Bessent separately promised tougher Iran measures next week.• Copper: The LME September-October spread exceeded $260 a ton, its widest backwardation since 2021, as inventories fell for a 42nd day. Three-month copper topped $14,100.• Agriculture: Ukraine said closed Odesa ports could halve seasonal farm exports to 30 million tons; no vessels have entered since early August.• Tech Premarket: Applied Materials extended its decline to 5% from roughly 3% after hours. Innventure plunged 46% after withdrawing Accelsius guidance.
Russian energy attacks widen supply risks as JD.com tumbles
Asian stock dispersion widened, while Russian supply disruptions kept energy risk elevated.• China Tech: JD.com fell more than 10% in Hong Kong after its first quarterly revenue decline since 2014. SMIC gained as much as 6.4% on an earnings beat and stronger margin guidance.• Russia/Energy: Bloomberg counted attacks on 10 of Russia’s 34 large refineries this month, prompting regional fuel rationing. A drone attack also sparked a fire at Ust-Luga port; officials did not identify damaged facilities.• Tankers: Signal Ocean said 62% of oil and product tankers crossed Hormuz with transponders off from July 14 to early August, up from about half previously.• Nintendo: Shares rose as much as 7.5% after Pokémon Pokopia sales exceeded 5 million.• Aviva: First-half operating profit rose 24% to £1.33 billion, beating estimates, although the insurer cut its health-profit outlook to £90 million.