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Fundamental indicators from the Fed and ECB, employment and inflation, Nvidia growth and corporate review

Fundamental indicators from the Fed and ECB employment and inflation Nvidia growth and corporate review

 • After the Bank of Canada became the first G7 country to cut interest rates, the conditions were created for the European Central Bank to cut rates. But all eyes are sure to be on President Christine Lagarde as traders ponder: what comes next? While ECB policymakers made clear their intention to cut borrowing costs in June, well ahead of the US Federal Reserve, the path forward has become uncertain.

 • Nonfarm payrolls data is due out on Friday and will be critical to easing or strengthening expectations for a resumption of easing ahead of next week's Fed meeting, where the dot plot and policymakers' comments will be the focus.

 • Chip stocks around the world are once again basking in Nvidia's glory after the artificial intelligence chip maker became the world's second most valuable company and is now valued at more than $3 trillion.

 • Nvidia CEO is in Taiwan this week. Touted as a local boy who has made it big, Jensen Huang is the subject of live coverage on Taiwanese television. It's no surprise that Taiwan stocks are surging, hitting a record high thanks to TSMC, whose main clients include Nvidia and Apple.

 • The wage gap between those who stayed in their jobs and those who changed jobs narrowed in May.
This is a possible sign that the US labor market is cooling from a hot start until 2024. New data from ADP released Wednesday showed the average annual wage increase for those changing jobs fell to 7.8% in May, down from recent spikes of 8.3% in March and 8% in April. . The gap between wage growth for workers who changed jobs and those who stayed the same, which rose 5% in May, is at its lowest level since February and is a far cry from 2022-23 levels.
The change in ADP employment in May is worse than expected
- an increase of 152 thousand against expectations of 175 thousand.

 • We are waiting for official data on the US labor market on Friday.
The US economy remains strong, led by services
- Composite PMI rose from 51.3 to 54.5 (expected 54.4)
- Services PMI rose from 51.3 to 54.8 (as expected).

 • Ray Dalio: The world is entering a period of increased risk. Investors should diversify their investments across countries, currencies and asset classes.

 • NVDA became the second most valuable US company. Ahead of AAPL. The first one remains MSFT.

 • The parent company of Jim Beam enters the US bond market

 • Suntory Holdings issued bonds in the amount of $500 million, most likely to purchase SAM.

 • Blackrock and Citadel plan to launch a new national stock exchange in Texas - WSJ. They want to compete with the NYSE.

 • McDonald's (MCD) will no longer be able to call its burger with chicken cutlets “Big Mac” in the European Union and use this trademark to name restaurants.
The European Court sided with the Irish fast food restaurant chain Supermac, which tried to ban the American company from using the "BigMac" trademark. She argued that the similarity of names could confuse consumers.

 • The list of public whistleblowers against Boeing is growing. This time, two former airline employees called the planes a "ticking time bomb."

 • Managers complain en masse that it is impossible to give feedback to zoomer employees - Fortune. The generation has become so pampered that, having received any, even constructive, criticism, they accuse their superiors of toxicity and violation of psychological safety. The creator of Zoom believes that calling is a waste of time.
The head of the company believes that in the future, instead of us, AI clones will sit on calls, who will listen to all the questions and come back with a short squeeze on the meeting. These are not just words, the company is already working on this feature.
The next logical step is for AI clones to completely replace humans.

 • Nvidia will increase investment and build a 2nd supercomputer in Taiwan. Speaking to reporters in Taipei, Nvidia CEO Jensen Huang confirmed that Nvidia, the world's most valuable chipmaker, plans to build another supercomputer in Taiwan following last year's launch of Taipei-1.

 • Cisco launched a $1 billion fund to invest in AI. The company is investing in Cohere, Mistral AI and Scale AI, among others, and has already committed nearly $200 million to the fund.

 • As expected, Apple has reached an agreement to integrate OpenAI's ChatGPT into the iPhone operating system.
The agreement is due to be announced at Apple's developer conference next week. Thus, the smartphone maker is aiming to catch up in the field of AI.

 • US crude oil inventories rose by 1.2 million barrels last week.
Gasoline and distillate inventories also increased as refineries increased their capacity utilization.

 • Hewlett Packard Enterprise shares rose 16%.
The company reported better-than-expected earnings thanks to sales of servers built to run artificial intelligence.

 • The US services sector returned to growth mode in May after briefly contracting the month earlier, and business activity improved the most in three years.
Survey data released Wednesday.
This could bolster the Fed's caution about moving toward lower interest rates.

 • ASML Holding NV (semiconductor equipment) became the second largest listed company in Europe.
For the first time in history, it overtook LVMH in market value. In European markets, only Novo Nordisk A/S costs more.

 • Hopes for Fed policy easing are growing.
About 65% of traders expect a rate cut at the September meeting, up from less than 50% a week ago, according to the CME FedWatch tool.

 • Services sector growth was stronger than Wall Street expected.
Economic activity in the services sector returned to growth in May after contracting in April for the first time in nearly two years. The Institute for Supply Management's services PMI came in at 53.8 in May, up from 49.4 in April and higher than the 51 that economists had expected, according to Bloomberg data.

 • LULU shares rise 10% after the report.

 • VSCO shares fall 2% after the report.

 • Weak economic data returned optimism to investors in anticipation of the Fed's rate cut to begin soon.

 • Growth and AI stocks are among the leaders.


- Reports from DocuSign, JM Smucker, NIO and Samsara.

- The ECB is expected to cut its key short-term interest rate from 4% to 3.75%. The ECB will become the second major global central bank to cut interest rates, following the Swiss National Bank's rate cut at the end of March.

- Important investor events, including Lululemon and Alphabet annual meetings, and Lyft Investor Day.

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