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Financial news - Powell in Congress, Biden moves on, corporate company news

Financial news Powell in Congress Biden moves on corporate company news

Fundamental Analysis

• Fed Chairman Jay Powell will kick off two days of semi-annual congressional hearings with Senate testimony on Tuesday. Inflation was a concern at the start of the year but has slowed recently, while the labor market shows signs that months of tight policy are taking their toll. Traders will be watching how Powell balances the risk of renewed price pressures without creating unnecessary hardship for voting American workers. The day after Powell's testimony ends on Thursday, the latest consumer price data will be released, which will likely be the opposite of the order of events that investors, and perhaps Powell, would prefer.

• “It’s time to end this”: Joe Biden wrote a letter to Democrats about his participation in the elections. The US President told supporters that he will remain in the race in 2024. In this way, the 81-year-old politician is trying to quell speculation and an internal party rebellion against his campaign. Incumbent President Joe Biden continues to insist he will remain in the race even as his rivals and the media continue to look for reasons why he should resign. At least Biden appears to be winning among the bookmakers, with odds on him rising 13 cents to 54 cents on the dollar, while odds on Kamala Harris replacing him have fallen by the same amount to 30 cents. although at the weekend they were almost equal. Donald Trump could sideline an unknown candidate in his bid to retake the White House on July 15, the day the Republican National Convention begins, when he could name his running mate.

• In France, where the vote is effectively divided between three parties spanning the political spectrum, it is difficult to imagine what the final government might look like. Even the winners of the vote, the left-wing New Popular Front (NPF), were a hastily assembled alliance aimed at preventing the rise of the far-right National Rally (National Rally). This happened, and the party won 182 seats in parliament to 143 for the RN, while President Emmanuel Macron's centrist Ensemble Alliance party won 163 seats. What seems certain is a period of political paralysis and decline in French influence in Europe. But it also avoids the outcome that markets feared most: far-right fiscal profligacy.

• Orban, after meeting with Zelensky and Putin, arrived in Beijing to continue the “peace mission.” Next, Orban will go to Washington.

• The IMF plans to reduce fees for large borrowing countries, including Ukraine. The IMF is discussing a review of the amount of additional fees and fines levied on major borrowing countries, including Ukraine, Argentina and Egypt.

Corporate analysis 

• Boeing pleaded guilty in connection with two 737 MAX crashes. The company will pay an additional fine of $244 million, The Wall Street Journal writes about this, citing court documents. In addition to the fine, Boeing will have to hire a consultant to monitor its compliance with aviation regulators.
A felony guilty plea could spell trouble for Boeing's business. In particular, it jeopardizes its status as a contractor for the US federal government, the publication notes.

• European rocket launch targets SpaceX -WSJ. After years of delays, Europe will test launch on Tuesday a new rocket that officials hope will help reduce the US company's dominance.

• Shares of Chinese shipping companies fell on reports of progress in the ceasefire in Gaza - WSJ. On expectations of a reduction in freight rates after Hamas reportedly approved a ceasefire agreement in Gaza.

• Bybit launched Hamster Kombat in premarket. The token will appear in the listing as soon as the hamster enters the TON platform.

• Saudi Arabia announced seven new oil and gas fields in Sharqiya and Rub al-Khali. Energy Minister Abdul Aziz bin Salman announced the findings, which include two unconventional oil fields, a reservoir containing Arabian light oil, two natural gas fields and two natural gas storage tanks.

• China has allowed taxis to operate without operators in Shanghai - WSJ. China has added Shanghai to the list of cities that allow driverless robotaxis without safety controllers, part of an effort to become a global leader in autonomous driving and commercialize the technology.

• Eli Lilly has agreed to acquire biopharmaceutical company Morphic Holding for $3.2 billion in a deal that will strengthen the manufacturer's immunology pipeline.

• Exxon's 2Q expectations below market consensus, excluding Pioneer purchase - Reuters. Exxon Mobil Corp. on Monday signaled that tightening industry refining margins and lower natural gas prices would drag down second-quarter earnings.

• Airbus confirms delivery of 323 aircraft in the first half of the year - Reuters. Which is 2% more than 316 for the same period in 2023.

• Broadcom began selling bonds to refinance loans for the VMware deal. AVGO hit the U.S. investment-grade bond market on Monday to refinance some of the borrowings it took out to pay for its $69 billion VMware acquisition.
Morgan Stanley's Wilson Sinks for Correction
He says a 10% stock market correction is "very likely" ( Bloomberg) and traders should prepare for a correction in the stock market amid uncertainty around the US presidential campaign, corporate profits and Fed policy.

• Market capitalization of Taiwan Semiconductor Manufacturing Co. briefly exceeded $1 trillion. After Morgan Stanley raised its price targets for the company's shares.

• The German government sold nearly $1 billion worth of Bitcoin yesterday.

• Microsoft in China will buy all its employees iPhones so that they stop using Android. The company prohibits the use of Android phones at work because "they are dangerous."

• Markets are calm and awaiting US inflation data on Thursday, as well as the start of reporting season on Friday.

Key events that could impact markets on Tuesday:

- Greece, Hungary, Netherlands CPI (June).

- Speech by Fed Chairman Powell in the Senate with his semi-annual report on monetary policy.

- The three-day conference SEMICON West will continue. The event will showcase the latest advances in microelectronics, covering electronic design automation, device fabrication and end-to-end manufacturing, including assembly, packaging and testing.

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