Fed rate cut as early as September and possible replacement of Chairman Powell, stock market news of companies and geopolitics
Latest stock market news
• The stock market returned to growth yesterday: stock indices rose by 1-2%. At the same time, US government bonds and gold also rose in price, and the dollar fell. This indicates the presence of dollar liquidity.
The mood is also optimistic.
Growth stocks, led by AI chips, were the leaders in growth.
Everything is calm on futures this morning.
• Markets are struggling to see the bright side of bad news out of the U.S., expecting the disappointing data to kick-start the economic “rocket engine” of Federal Reserve rate cuts that President Donald Trump is craving. The chance of a rate cut in September is now about 94%, up from 63% last week, according to CME Fedwatch. Market participants expect at least two quarter-percentage-point cuts by the end of the year.
The odds rose sharply after disappointing nonfarm payrolls data on Friday sent stock markets tumbling and Trump fired the messenger, firing the head of labor statistics and promising to replace her within days.
Institutional independence in the US is becoming a short-term bet. The early departure of Fed Chair Adriana Kugler will allow Trump to choose her successor, heightening fears about the intrusion of partisanship into the staid world of central bank policy.
• Asian markets followed Wall Street's gains, with MSCI's index of Asia-Pacific shares excluding Japan rising 0.4%. South Korea's Kospi rose 1%, while Vietnamese shares traded near a record high.
• Asian resilience: Data today from the region's two largest economies showed the resilience of their services sectors amid the negative impact of Trump's chaotic imposition of tariffs on trading partners' goods.
In Japan, S&P Global's services purchasing managers' index (PMI) rose to 53.6 in July from 51.7 in June, the biggest gain since February. China's services sector activity expanded at its fastest pace in more than a year last month.
• A number of purchasing managers' indexes (PMIs) for July are due to be released across Europe today.
• The second-quarter earnings season in the U.S. is drawing to a close, but investors are still eagerly awaiting reports this week from major players including Walt Disney and Caterpillar.
Stock futures pointed to gains in European and U.S. markets, with pan-regional Euro Stoxx 50 futures up 0.13% and S&P 500 e-minis futures up 0.14%.
• Hong Kong-listed China ETFs see record inflows amid stock correction - BBG
• Berkshire Hathaway (BRK-B) has amassed a record 30% of its total assets in cash, the highest level in the history of Warren Buffett's company.
/ But the shine on the Buffett name is fading. BRK shares fell 3% yesterday after its quarterly earnings report, which is traditionally released on the weekend, while the broader market rose 2%.
• The Boeing Defense union of 3,200 workers is ready to strike for the first time since 1996.
Boeing (BA, +0.2%) said it is prepared for a strike and has fully implemented a backup plan.
• China opens door to Brazilian coffee after US tariff strike - Reuters
After the US imposed a 50% tariff on Brazilian coffee imports, China quickly allowed 183 new Brazilian companies to enter its market.
• Xiaomi has unveiled an open AI voice model, the “MidasHenglm-7b.”
It complements its automotive and home technologies, further intensifying competition in the field of creating AI tools for more than just text, - Bloomberg.
• Altman: “We have a lot of launches planned for the next few months—new models, products, features, and more.
We ask for your understanding if there are any disruptions. Despite some challenges, we are confident that you will like what we have in store for you.”
• AI with human cognitive abilities may appear in 5-10 years—CEO of DeepMind (Google's AI division).
/ Will it also have emotional intelligence? If so, the first to suffer will be Only Fans models. And some countries will stop receiving taxes from these models.
• Apple (AAPL) is working on a simplified alternative to ChatGPT—focused on accessing the world's knowledge through Apple products like Siri, Safari, and Spotlight—ET.
/ Apple's problem is a long-standing grudge against Nvidia. As a result, Apple doesn't buy Nvidia's AI chips, and other chips are holding it back. So human grudges and decisions are costing AAPL shareholders billions.
• Tether plans to launch its own Plasma blockchain, which will have zero fees for USDT transactions.
/ Currently, 80% of Tether transactions take place on three blockchains - Tron (TRC-20), Ethereum (ERC-20), BNB Chain (BEP-20).
• Decentralized applications (DApps) on Solana generated $1.6 billion in revenue in the first half of 2025,
4x more than the same period in 2024.
• Cryptocurrencies will add $30 billion to the gaming market - analysts.
By 2028, the global gaming market may grow by more than $30 billion thanks to the introduction of cryptocurrencies, according to the Casino Global Market Report 2024.
In particular, the segment of crypto casinos and decentralized platforms is growing.
• Musk: “Many strong engineers from Meta have already joined and continue to join xAI – and without compensation.”
/ Zuckerberg “poaches” AI specialists from OpenAI. And Musk “poaches” engineers from Meta?
We live in interesting times.
• Tesla's general meeting approved a compensation package for Musk in the amount of 96 million shares ($29 billion).
The meeting itself is on November 6.
The new agreement on compensation for Musk removes uncertainty around Tesla, - Wedbush.
TSLA +2%.
• Goldman: OPEC+ to suspend oil production increase due to rising inventories in OECD countries.
• Google (Alphabet) has become the most profitable company in the world—$116 billion in net profit for the year.
/ At the same time, the company employs only 183 thousand people.
• BP has discovered its largest oil and gas discovery in 25 years off the coast of Brazil.
• Non-Mag7 earnings are falling. Bank of America estimates that annual earnings growth for investment-grade companies in the U.S. (excluding energy and financials) is +3.7%.
However, if you exclude the top 7, earnings are down 1.0%, further evidence that the bulk of the growth is coming from just a handful of tech giants.
• Thousands of hotels are suing Booking.com (BKNG, +1.7%) for 20 years of damages.
More than 10,000 European hotels have filed a class action lawsuit against the online travel portal seeking compensation for forced pricing from 2004 to 2024.
During those years, hotels were not allowed to offer rooms on their own websites cheaper than Booking.com.
The lawsuit follows a 2024 ruling by the European Court of Justice that found the so-called best price rules to be a violation of antitrust laws.
• Verb Technology announced a $558 million private placement
to launch the first publicly traded company with a treasury strategy on TON.
Investors include Kingsway Capital, Vy Capital, Blockchaincom, and Ribbit Capital.
VERB +115%.
• Peter Thiel-backed cryptocurrency exchange Bullish has filed for a U.S. IPO, Reuters reports.
Ticker BLSH.
• Lyft (LYFT, +3%) partners with Baidu to launch robotaxis in Europe.
Flying taxi operator Joby Aviation (JOBY, +19%) will acquire Blade Air Mobility’s (BLDE, +17%) passenger business for $150 million
/ Rare Win-Win.
• CTAs start to close EURUSD longs.
BofA analysis shows that the most aggressive CTAs have started to close overly long positions, but the majority of market participants are still long.
• RTX Corp. (RTX, +0.4%) won a $50 billion/2020 DLA umbrella deal
for logistics across all DoD branches, cementing its status as a key defense supplier.
• CoreCard (CCRD, -0.2%): Apple (AAPL) may move its credit card to JPMorgan (JPM)
→ risk losing a major customer; CCRD is also acquiring Euronet (EEFT).
• Boeing (BA) has signed an $883 million contract with the Army through 2030 to support cargo systems.
• VinFast (VFS, +2.4%) invests $500 million in a plant in India (150 thousand EV/year) → entry into South Asia and MEA.
• UBS (UBS) completes Credit Suisse acquisition, pays DOJ $300 million; reserves return to Q3 earnings
• Energizer (ENR, +27%) revenue +3.4% to $725 million, margin 44.8%.
• Wayfair (W, +13%) EPS $0.87 (> cons. by $0.54), revenue $3.27 billion, sales in the US +5.3%.
• PLTR shares are up 4% this morning after the report.
• Demand for options to hedge the risk of the S&P 500 falling 10% over the next 60 days reached its highest level since May 2023.
Key events that could impact markets on Tuesday:
- French industrial production for June
- Purchasing managers' indices for July in France, Germany, the eurozone and the UK
- European earnings: Diageo, BP, Deutsche Post, Telecom Italia
- U.S. earnings: Caterpillar, Pfizer, Yum! Brands, Marriott International, Fox Corp.
Current Fundamental Reviews
• The EU expects Trump to announce tariff cuts on cars and exemptions on some industrial goods such as aircraft parts this week - BBG.
• The Swiss government has said it is not currently considering any retaliatory measures against the United States and intends to offer the United States more attractive terms for a trade agreement./ Trump demands that Switzerland first reduce drug prices.
• China is cutting off supplies of critical rare earth minerals to Western weapons contractors, crippling U.S. defense production.
More than 80,000 parts for the U.S. Defense Department depend on minerals controlled by China. / It is a sign of worsening U.S.-China trade relations. And is seen as a response to threats of secondary sanctions for China's purchase of energy from Russia.
• Brazil and India ignore Trump's threats and will not stop buying oil from Russia, writes the Chinese Global Times.
For China, and for India, buying Russian oil at a big discount due to sanctions against Russia has become real "gold". Thanks to cheap hydrocarbons, the economies of these countries receive a non-market advantage over other countries.
However, the ability of India and Brazil to resist US pressure is severely limited. And China is blackmailing by refusing to supply rare earth metals.
• The head of Brazil's Supreme Court, who is under US sanctions, has placed Bolsonaro under house arrest./ Trump will clearly not like this. But there's nothing he can do.
• India's largest refiner Indian Oil Corp (IOC) has bought 7 million barrels of crude for September delivery from the United States, Canada and the Middle East,
several market sources told Reuters.
Two sources said the volumes were higher than usual, partly to replace Russian crude.
• Trump sets new record:
US collected $29.6 billion in tariffs in July, the most ever.
Trump said revenue from new import duties could be redistributed as dividends to low- and middle-income citizens.
• "China is preparing to invade Taiwan," Taiwan's vice foreign minister told Sky News.
/ It has been preparing for a long time. But the peak of China's ability to conquer Taiwan militarily is approaching or has already arrived. For now, the West is slowly but surely trying to learn the lessons of the Russia-Ukraine war.
• A protracted shortage of ore raw materials has forced Chinese copper smelters to cut production from record levels
as the government steps up efforts to reduce excess capacity in the industry - Bloomberg
• The Guardian has questioned Trump's mental health.
The publication's journalist Adam Gebbutt notes that the US president constantly loses the thread of a conversation, forgets facts and makes senseless speech.
Psychiatrist Richard Friedman said that with such distracting and repetitive speech, he would send the patient for a neuropsychiatric examination. The White House rejects any doubts about Trump's mental health. Trump really does manage to say directly opposite things in one statement.
But so far it looks more like incontinence, when, on the one hand, he says what he wants to say, and on the other, what others want to hear from him.
• Turkey is preparing to sign a comprehensive military cooperation agreement with Syria.
It envisages the establishment of three Turkish military bases in the country - Aydinlik.
/ Turkey has ousted Russia from Syria. Erdogan's small victory over Putin.
• The UN Security Council will hold an emergency meeting on the Israeli hostages.
Israeli television channel Channel 12 reports that the Israeli government has decided to occupy the Gaza Strip permanently. Hamas is the main culprit of the famine in the Gaza Strip, said the head of the German Chancellery, Torsten Frei.
“Currently, much more humanitarian aid is being delivered to the Gaza Strip every day than is needed to prevent famine.”
• 59% of Germans are not prepared to defend Germany with weapons in the event of an attack.
The Forsa sociological institute conducted a survey among 1,002 residents of the FRG, the results of the survey were published by the RND media group.
However, in 2025, recruitment into the German army increased by 28% compared to the same period in 2024.
There are currently approximately 183,100 active military personnel in the Bundeswehr, which is about 2,000 more than last year.
• As Trump loses support, UN cuts spending by more than $700 million, plans reform — Bloomberg.
Secretary-General Antonio Guterres’ plan calls for 20% cuts in spending and headcount, leaving the $3.7 billion budget at its lowest since 2018. About 3,000 jobs would be cut.
• Trump Advisor Hassett:
BLS data has become extremely unreliable.
We need to modernize employment data by making it transparent.
Significant changes in data require clear explanations.
Ray Dalio also supported the need for changes to the BLS.
• US Treasury Secretary Scott Bessent confirmed that Powell's replacement is on the horizon.
"We are putting together a very high-quality list of candidates. And remember, there are two openings."
• In Moldova, Dodon has united with other pro-Russian leaders: they have been allowed to participate in the elections.
In Moldova, the Central Electoral Commission has officially registered the Patriotic Electoral Bloc (Blocul Electoral Patriotic – BEP) to participate in the parliamentary elections. The union includes the Socialist Party of pro-Russian ex-President Igor Dodon, the Heart of Moldova party, and the Future of Moldova party.
In Moldova, the license for gas supplies to Gazprom subsidiaries has been revoked
Moldova has revoked the license for gas supplies to Moldovagaz and transferred this function to the state-owned Energocom.
• South Korea dismantles "propaganda assets" on border with North Korea - Yonhap News.
The department explained that this step is part of "practical measures" aimed at reducing tensions in inter-Korean relations. At the same time, Seoul emphasizes that such actions will not affect the combat readiness of the armed forces.
• In Helsinki, roads were narrowed and trees were planted in such a way as to create inconvenience for drivers. The result: not a single accident in a year - Politico.
In addition, the capital of Finland reduced the maximum permitted speed to 30 km/h, installed 70 new speed cameras and increased police surveillance.
/ Useful experience? What do you think?
• China Services PMI above expectations = 52.6 (expected 50.4, pop. 50.6).