Macro update
Asian equities trade cautiously ahead of key AI earnings: Investors adopted a more defensive stance before a crucial technology earnings season, with South Korea’s KOSPI falling 0.8%, Japan’s Nikkei declining 0.4% and MSCI’s Asia-Pacific index excluding Japan easing 0.2%.
Oil prices remain near four-month lows: Brent crude slipped 0.2% to $71.95 a barrel, while WTI held around $68.49, after OPEC+ agreed to increase production targets by a further 188,000 barrels per day from August as exports through the Strait of Hormuz continued to normalise.
Dollar strengthens ahead of key US economic releases: The dollar index steadied at 100.88 after weakening following the softer June payrolls report, while the greenback gained 0.3% against the yen to ¥161.96 as traders continued to test Japan’s willingness to intervene in currency markets.
Gold eases as the dollar firms: Spot gold fell 0.4% to $4,160.33 an ounce as a stronger US dollar weighed on demand, although expectations of a less aggressive Federal Reserve helped limit losses after the metal posted a gain of more than 2% last week.
Samsung expected to report a sharp rise in chip profits: Analysts forecast the world’s largest memory chipmaker will announce an 18-fold increase in operating profit to 86 trillion won for the April-to-June quarter, driven by strong AI-related demand and constrained semiconductor supply.
Markets pare expectations of near-term Fed tightening: Weaker-than-expected June employment data and lower energy prices prompted investors to reduce the likelihood of an imminent Federal Reserve rate increase, with futures implying a 78% probability that rates will remain unchanged at the 29 July meeting ahead of the release of the Fed minutes.
