Zero Rss

SpaceX Reportedly Turns Away Falcon Customers As Starship Gamble Comes Into Focus

Yet another corporate media report based on anonymous sources is likely to draw an immediate response from Elon Musk. He has repeatedly used X this year to challenge reporting on Tesla and SpaceX.

Bloomberg reports that SpaceX has begun turning away satellite operators seeking dedicated Falcon 9 launches after 2028 and is no longer accepting future reservations. The report was based on people familiar with the matter, and the company has not confirmed it.

The report continued:

Engineers at Musk's rocket, satellite and artificial intelligence juggernaut have halted building some non-reusable components for the Falcon family, such as the rocket's massive upper stage, said one of the people.

. . .

SpaceX's plans could change for a number of reasons, including development setbacks with the futuristic Starship vehicle, the people said. The company is likely to still use the Falcon 9 for launches for the Department of Defense and NASA, some of the people said.

If Starship isn't operational by the end of 2028 and Falcon production isn't extended, satellite operators could face a shortage of heavy-lift launch capacity. That means a lot is riding on the mega-rocket Starship getting through the testing phase and achieving commercial viability.

Starship's execution risks weighed on SpaceX shares this week after last week's test-launch delay. Over the past several weeks, more than $1 trillion in market capitalization has been wiped out.

Shares have fallen about 16% below the $135 IPO price in recent days.

The CIO of Tigress Financial Partners noted that the latest Starship launch abort "underscores ongoing execution risk around ramping Starship to high-cadence, reusable operations, and reinforces that repeated delays could push out revenue and margin trajectories."

Could be wrong, but it seems that 4 engines didn’t light causing the abort sequence

Unfortunate scenario, but better safe than sorry! Hoping for another attempt tomorrow pic.twitter.com/o0BQ8Ekt7i

— Victor Kerman (@VictorKerman) July 16, 2026

Starship's Thursday launch attempt was postponed due to adverse weather conditions, with another attempt scheduled for later this evening. Check back for updates.

Tyler Durden Fri, 07/24/2026 - 14:45

A Quantum Roadmap Would Push Bitcoin Much Higher

Authored by Ciaran Lyons via CoinTelegraph.com,

Bitcoin developers need to swallow their pride and outline a clear plan to harden the blockchain against quantum computing attacks, according to Capriole Investments founder Charles Edwards. He says the day they finally bite the bullet, the price will respond very quickly.

“If the Bitcoin core team says in two or three months: ‘this is our roadmap, we’re gonna solve it in the next two years, these are the rough steps we’ll take,’ that would be amazing news,” Edwards tells Cointelegraph on Trade Secrets. 

“I think that would discount a lot of the risk pretty much overnight,” Edwards says.

The question of whether Bitcoin developers should modify the network to make its cryptography quantum-resistant has sparked heated debate within the Bitcoin community, with some arguing that major changes could conflict with Bitcoin’s core ethos. Others claim quantum computers are many years away, and a rushed cure could be worse than the disease.

Charles Edwards says a clear roadmap could push price up “very quickly”

Edwards often highlights the risk of quantum computing to Bitcoin to his 132,800 X followers. The fear is that, one day, powerful enough quantum computers could break the cryptography that protects the Bitcoin network and potentially compromise Bitcoin wallets.

The uncertainty has impacted investor sentiment, and some analysts say it has contributed to the downfall in Bitcoin’s price. The world’s largest asset manager, BlackRock recently pointed to quantum computing as a potential long-term risk in materials for spot Bitcoin ETF investors. 

However, Edwards says if Bitcoin developers outline a clear roadmap to address the quantum threat, as some other chains have already done, it could send Bitcoin’s price higher “very quickly.” 

Source: Charles Edwards

“Double digits probably,” Edwards predicts.

He adds the quantum issue is “somewhat counterintuitively an upside catalyst potential,” because it is currently on the back burner and the Bitcoin Improvement Proposals (BIPs) to date are “not really” a genuine solution.

Edwards is no stranger to making high-conviction calls on Bitcoin. Based in Melbourne, Australia, he founded Capriole Investments in 2019, a hedge fund focused on Bitcoin and digital assets. The firm uses a combination of quantitative models, AI, and macroeconomic analysis to guide its investment strategy across crypto markets.

Charles Edwards says Bitcoin is 40% below its fair value

A growing number of observers worry the risk could become more serious if Bitcoin developers fail to make the necessary changes to the network before 2030. Ethereum is due to complete it’s post quantum overhaul by 2029, which will shine a spotlight on Bitcoin’s own preparations.

Bitcoin is trading at $65,270 at the time of publication. Source: CoinMarketCap

Edwards estimates that Bitcoin is currently around 40% below what he considers its fair value based on energy value, while arguing that quantum risk accounts for roughly a 30% discount. “That means it’s more than priced in,” Edwards said. Bitcoin is trading at $65,270 at the time of publication, roughly 49% below its October all-time highs of $126,100.

Edwards clarifies that Bitcoin’s current price reflects the quantum risk based on the information available today, rather than any unknown future developments that could accelerate the threat and tank the price further. 

His estimate is based on the timelines outlined by leading quantum computing companies and researchers for when “Q Day” could arrive, the point at which quantum computers become powerful enough to reverse engineer private keys from public keys. 

“That sits in that four to five year range, give or take, a few years,” Edwards says.

Edwards says he also factors in the time Bitcoin would need to develop and implement a solution, which BIP-360 author Ethan Heilman estimates could take years.

“If we’re gonna get into maths, it’s pretty simple; it is just an aggregation of those expert opinions. So it’s based on that, and based on the fact that there’s currently no solution for Bitcoin.”

“That risk again falls significantly if there’s a solution or if there’s a roadmap to a solution. But it also could grow if tomorrow we find out that Google is, you know, twice as far ahead on their roadmap to Q Day or some other major company,” he said.

“It’s priced in today, but it’s not to say that it can’t get worse or better. It’s just I think it’s skewed more probabilistically to the upside from here,” Edwards says.

Tyler Durden Fri, 07/24/2026 - 14:20

"USA Isn't A PiggyBank For Europe": Trump Launches Section 301 Probe Into EU Over Big Tech Fines

Summary:

• Trump Opens Section 301 Investigation On Europe Over Big Tech Fines 
• Trump Slaps Forced-Labor Duties On 60 Countries 
• Trump Begins Rebuild Tariff Wall After Supreme Court Ruling Earlier This Year 

Trump Says US Begins Section 301 Investigation on Europe 

President Trump wrote on Truth Social that the US will launch a Section 301 investigation into the European Union for "robbing American companies, in turn, the American Taxpayer." 

Trump said Brussels is using America as a "PIGGYBANK" by fining Big Tech companies billions and billions of dollars.

Trump listed the technology companies that have been fined a combined billions of dollars:

After having fined Apple, for no reason at all, 15 Billion Dollars, Meta, 3 Billion Dollars, Amazon 2.5 Billion Dollars, and many others, we have just been informed that Google, a truly advanced and amazing group, has been fined yet another 1 Billion Dollars, without explanation. This brings the Google total to over 18 Billion Dollars!

Trump continued:

This illegal and highly discriminatory practice started at these high levels during the first year of the Sleepy Joe Biden Administration, but it's not going to continue during the Trump Administration.

He added:

The United States of America is not a "PIGGYBANK" for Europe, nor will we allow it to be!

Please let this TRUTH serve to represent that we will immediately initiate a 301 Investigation into the practice of "ROBBING" American Companies and, in turn, the American Taxpayer.

The European Union will pay a very big price for this illegal and highly unethical conduct, which I have consistently warned them about.

The penalties will be entirely reversed and, we anticipate, a substantial TARIFF to be placed on them at the earliest possible moment.

"The United States of America is not a “PIGGYBANK” for Europe, nor will we allow it to be! Please let this TRUTH serve to represent that we will immediately initiate a 301 Investigation into the practice of “ROBBING” American Companies and, in turn, the American Taxpayer." -… pic.twitter.com/TRGPi0rCm3

— The White House (@WhiteHouse) July 24, 2026 Trump's Tariff Wall Returns With Forced-Labor Duties On 60 Countries 

The Trump administration imposed Section 301 tariffs on 60 countries accused of failing to "impose and effectively enforce" bans on goods produced with forced labor, according to a new notice from the Office of the U.S. Trade Representative.

Today, Ambassador Greer is taking action, at President Trump’s direction, under Section 301 of the Trade Act of 1974 by imposing tariffs on 60 trading partners for their failure to adopt and effectively enforce a prohibition on the importation of goods produced with forced labor.…

— United States Trade Representative (@USTradeRep) July 23, 2026

Goods from countries including Canada, Mexico, India, and the UK will face a 10% duty, while imports from the European Union and Taiwan will be taxed at least 10%. Products from Japan, South Korea, and Switzerland will face levies of at least 12.5%, with dozens of other countries subject to a flat 12.5% tariff.

Fuel, food, fertilizer, and products already covered by sector-specific tariffs, including automobiles, metals, and pharmaceuticals, will be exempt. Goods qualifying under the US-Mexico-Canada trade agreement will also be excluded.

The tariffs take effect Friday at 12:01 a.m. New York time, marking the biggest move yet to restore President Trump's protectionist tariff wall since his earlier levies were struck down by the Supreme Court. After that setback, the president instituted a 10% global import tax, which expires Friday. The timing of the new levies ensures there will be no gap between the two.

"President Trump recognizes that decades of moral suasion have not eradicated forced labor from global supply chains.  The United States has had a forced labor import ban for nearly a century, and rigorously enforces it; it's well past time for our trading partners to do the same," Trade Ambassador Jamieson Greer wrote in a statement.

Greer said, "Today's action will begin to correct what is both a human rights abuse and a distortive trade practice to improve the welfare of workers everywhere.  I am encouraged by the trading partners who have moved quickly to adopt forced labor import prohibitions, and look forward to ensuring their effective enforcement."

Bloomberg noted that the new Section 301 levies are expected to lift the average effective U.S. tariff rate by just 0.1 percentage point to roughly 10.7%. That remains below the 13.5% rate in place before the Supreme Court's February ruling.

Ernst & Young trade expert Blake Harden was quoted by Bloomberg as saying that the Trump administration is not yet done with tariffs or with disrupting the status quo.

"There's still a lot of uncertainty hanging out there. We still have the opportunity for a lot of tariffs this year," Harden said. "Prior to this week there was sort of just a bit of a lull and maybe it felt like there was more certainty than there is. There's this thing I keep telling folks: There's a lot to come still as we get into this year."

Here's a first take from Goldman Sachs chief economist Jan Hatzius, who said the new levies should have little effect on the overall US effective tariff rate:

BOTTOM LINE: The White House released the final version of the Sec. 301 tariffs it will use to replace the current 10% Sec. 122 global tariff, which expires July 24. The details of the release suggest there should be little change to the overall US effective tariff rate. Some individual trading partners will see their ETRs move higher or lower, but generally not by much more than 1pp in either direction.

1. The White House announced a new set of tariffs to replace the current 10% global tariff under Sec. 122 of the Trade Act of 1974, which expires July 24. Following a Sec. 301 investigation into forced labor, the US Trade Representative (USTR) has released a final list of tariffs covering trading partners accounting for 95% of US imports. There would be four levels of tariffs: a 10% cap (inclusive of the preexisting MFN tariff), a 10% add-on tariff, a 12.5% cap, and a 12.5% add-on tarif

2. While the prior version of these tariffs, released in June, would have raised the US effective tariff rate (ETR) slightly (+0.25pp), the final version just released should leave the ETR essentially unchanged (-0.1pp) because of four revisions USTR made: (1) the tariff rate for several large trading partners was changed to a cap (including the MFN rate) of 10% (EU and Taiwan) or 12.5% (Japan, Korea, and Switzerland) rather than a tariff on top of the MFN rate; (2) several trading partners including Argentina, Bangladesh, Cambodia, India, Malaysia, and the UK will face a 10% rate, rather than the 12.5% proposed in the earlier version (Taiwan moves from 12.5% add-on to a 10% maximum, like the EU); (3) product exclusions for specific trading partners in recent trade deals are now reflected, and (4) some new products were added to the exclusion list for all trading partners. In general, most of the trading partners getting the lower 10% rate in the final version have a recent trade deal with the US.

3. The change in each trading partner’s tariff rate compared with the expiring Sec. 122 policy would be modest, with only a few instances of changes greater than 1pp. The EU (-0.9pp), Indonesia (-0.9pp), and Korea (-0.7pp) would see the largest declines in their US ETR as a result of the shift from Sec. 122 to the new Sec. 301 rates, while Turkey (+1.5pp), China (+1.4pp), the Philippines (+0.8pp), Vietnam (+0.8pp), Singapore (+0.6pp) and Thailand (+0.6pp) would see the largest increases.

4. The USTR did not announce any new actions related to the other Sec. 301 investigation into 16 trading partners on manufacturing overcapacity, which was started around the same time as the just-concluded investigation. While this could still come in the next few weeks, we still believe that whatever tariffs come out of that second investigation won’t take effect until after the midterm election, and we continue to expect a roughly unchanged US ETR through the end of 2026.

Meanwhile, the US Customs and Border Protection has issued refunds to importers after the Supreme Court invalidated Trump's previous tariff regime.

Tyler Durden Fri, 07/24/2026 - 14:06

Oil Tanker Makes Red Sea U-Turn After Houthi Threats, Reroutes Around Africa In Costly Transit

ING's Singapore-based head of commodities, Warren Patterson, was asked during a recent webinar what it would take for Brent crude to exceed $120 a barrel. His answer was "not much," warning that prices could soar well into triple-digit territory if the Strait of Hormuz remains blocked through August and threats to Red Sea shipping intensify.

Patterson's warning about disruptions at the Strait of Hormuz and the Bab el-Mandeb Strait echoes concerns voiced across commodity desks this week: the longer these critical chokepoints remain impaired, the greater the upside risk to Brent, WTI, and fuel prices at the pump.

Fresh Houthi announcement, which muddles the waters a bit.

Paraphrasing: No closure of the Bab el-Mandeb strait; blockade only targets "the Saudi side," but that leaves unclear whether it includes (or not) foreign vessels lifting Saudi crude (or only Saudi oil tankers). https://t.co/tXsrjfQ4HK

— Javier Blas (@JavierBlas) July 24, 2026

Strait of Hormuz Crossings

Bab el-Mandeb Crossings

The latest signs of trouble in the southern Red Sea come from a Reuters report stating that the Danish-flagged tanker Torm Innovation was rerouted from Yanbu, Saudi Arabia, through the Suez Canal and around the Cape of Good Hope as an alternative to the Bab el-Mandeb Strait after two Saudi tankers were hit with projectiles by the Iran-backed Houthis earlier this week.

"Given the security situation in the southern part of the Red Sea, the vessel is sailing via the Suez Canal and around the Cape to Asia. This reflects our cautious approach to crew safety, which remains our highest priority," a Torm spokesperson told the outlet.

Rerouting around the Cape of Good Hope instead of transiting Bab el-Mandeb adds weeks of sailing time and sharply increases freight, fuel and insurance costs.

Longer voyages also tie up vessels for extended periods, effectively reducing available tanker capacity and tightening energy markets. The result will be higher tanker rates.

The rerouted tanker is carrying a 500,000-barrel cargo of Saudi naphtha from Yanbu to Japan.

🇸🇦Saudi Arabia's escape route from Hormuz is now being REROUTED again.

After shifting exports to Yanbu and Bab el Mandeb, Houthi attacks are forcing Asian cargoes north through Suez and then around Africa.

A Yanbu to Taiwan voyage jumps from
19 to 48 days.

Fuel costs rise… pic.twitter.com/eaViElkW6d

— Jack Prandelli (@jackprandelli) July 24, 2026

One question we have is whether this marks the beginning of a tanker exodus from the southern Red Sea, or whether surging gasoline and diesel prices at US pumps force the Trump administration to pursue a diplomatic off-ramp with Tehran to break the tit-for-tat strike cycle and restore order on critical maritime chokepoints to mitigate an energy shock.

Tyler Durden Fri, 07/24/2026 - 13:40

Betting On TACO? Oil Slides Despite Unraveling 'Diplomacy' In Iran; Trump Warns China & Russia Summary

• Diplomacy signals emerge: Pakistan is reportedly exploring renewed US-Iran talks, while Trump is set to meet Netanyahu next week amid the escalating conflict.
• War continues with 13th straight night of bombing: The US carried out a 13th straight night of strikes on Iran as Tehran launched fresh attacks on US-linked targets in Bahrain, Jordan, Kuwait, and Iraq.
• Oil eases: Crude prices fell by week's end despite continued fighting, as scant reports of possible diplomatic efforts outweighed ongoing regional attacks.
• Trump warns Russia, China: Trump cautioned China and Russia against supplying arms or targeting help to Iran.
• Political pressure grows at home: A new Fox News poll found most Americans oppose the Iran war, while reports say Trump is increasingly frustrated as the conflict drags on.

//--> //--> //--> Kharg Island no longer under Iranian control by August 31?
Yes 10% · No 90%
View full market & trade on Polymarket

*  *  *

Oil Eases by Week's End on Signs of 'Diplomacy Lite'

Somewhat surprisingly, oil prices are pushing lower by week's close, especially after a succession of perhaps 'diplomacy-lite' headlines; however, the reality still remains is that the bombing campaign is escalating... and typically the region witnesses the biggest bombs away on a weekend, with markets closed:

• Pakistan exploring path toward resuming US-Iran talks: Reuters
• Pakistan's push to resume talks follows pressure from China: Reuters
• Houthis say they don't seek to close key Bab al-Mandeb Strait (only for Saudi shipping, they say)
• Trump to meet Netanyahu at the White House on Tuesday amid Iran escalation

 

Trump on China, Russia Assistance to Iran

President Trump took to Truth Social to warn China and Russia against giving or selling arms to Iran, saying: "If they did, it would be very bad for them". However he also sought to clarify: "In my opinion, (they are) not participating."

Doing so was "certainly not in their best interests" - the president added. The president addressed a Reuters report that alleged Iranian strikes on CIA targets in the Gulf earlier in the war is being investigated, on concerns that Russia or China may have helped with such targeting.

Xi "told me he would not," Trump wrote. Was there a pinky promise?...

Iraqi Prime Minister Denies NYT Report on Ceasefire Offer

The latest little peace overture by Washington widely reported Thursday night was apparently a big nothingburger, as on Friday the Iraqi prime minister’s office has denied a New York Times report claiming that Iran rejected a US ceasefire proposal delivered to Tehran by Iraqi Prime Minister Ali al-Zaidi.

The fresh statement from the prime minister's office said what was published in the Times was "entirely unfounded" and had "no relation to reality." The statement underscored the temporary nature of the proposal and that it was the "only offer on the table" and still left the question of control over the Strait of Hormuz unresolved - and so Tehran was uninterested.

It's also the reality that Tehran wants to see Trump sweat and impose economic and political costs particularly ahead of the midterms in November, where Congressional Republicans must face voters over failing to rein in Trump's Iran war. The Iranians continue to openly voice this, for example in the following from the parliament speaker:

They wanted to punish Iran.

Punished themselves with triple-digit oil instead.

10/10 strategy👏👏👏 pic.twitter.com/w80f1Xzuvk

— محمدباقر قالیباف | MB Ghalibaf (@mb_ghalibaf) July 23, 2026 13th Straight Night of US Bombing

Meanwhile, in what is becoming a brutal, nightly routine, US Central Command (CENTCOM) has wrapped up its 13th consecutive wave of airstrikes against Iran. The Pentagon said it targeted military command centers, drone storage facilities, communication networks, and coastal surveillance sites. 

Iranian state media reported overnight into Friday heavy explosions rocking major hubs across the country, including Khorramabad, Jask, Ahvaz, Bandar Abbas, and the strategic outpost of Qeshm Island. Iranian media further said a US missile strike left four dead and five injured in the key industrial and transportation hub of Ahvaz.

As the bombs fall, Tehran is still signaling that military pressure won't force a cheap surrender - with Iranian Foreign Minister Abbas Araghchi lashing out at the US escalation, warning that "mindless aggression" will only see Trump pay a "heavier price" for a deal to end the war.

More Iran Retaliation on Gulf

Iranian retaliation on US-linked sites in the Gulf have continued at the same steady pace, with on Friday Bahrain's military having intercepted "several treacherous Iranian air attacks" - according to the general command of the Bahrain Defense Force.

The Bahraini military further denounced Iran's "systematic hostile approach" and "criminal attacks targeting civilians". The statement emphasized, "The general command emphasises that the deliberate use of missiles and drones to target civilians and private property constitutes a flagrant violation of international humanitarian law."

Throughout the morning the Iranian military's targets also included locations in Jordan, Kuwait, and northern Iraq. Sky News is reporting that "Explosions were also heard near a base hosting the US in Iraq, near the Erbil International Airport."

Fox Poll says Iran War More Unpopular Then Ever

Fox feeding its Boomer audience some Freedom Viagra with a helping of war crimes on the side:

Fox News discussion about Iran's infrastructure:

"What do you think we might hit first?"

"I don't know if we'll hit it first, but the Damavand plant supplies 40% of Tehran's electricity." pic.twitter.com/VpYVT2X4lI

— The American Conservative (@amconmag) July 23, 2026

But Fox News also reports the results of its latest poll which finds 56% oppose the ongoing American military action against Iran, including 40% who "strongly" oppose. "Disapproval of President Donald Trump’s handling of Iran hit a record high in July," Fox writes.

"A majority of voters oppose U.S. military action, and nearly two thirds think the conflict will last at least a year," the report says.

A Frustrated Trump is in 'Revenge Mode'

 This as The Wall Street Journal does an entire investigative report which should be laughably obvious to any careful observer to what's been going on and the deepening quagmire the US is getting itself into:

As the war in Iran enters its fifth month, Trump is increasingly frustrated that a conflict he once thought would be over in a matter of weeks has dragged on with no end in sight, administration officials and others close to the president said.

Some of Trump’s advisers now worry that the war—which has resulted in higher prices, falling approval ratings and the deaths of more than a dozen U.S. servicemembers—is consuming his presidency and damaging Republicans’ already dim prospects in the coming midterm elections.

Alarmingly, the WSJ noted that Trump seems in "revenge mode" against Tehran, and apparently sees no other options than to try and keep bombing his way out of it. Of course, this script has been written many times - not only during the "Global War on Terror" and this millennium's "forever wars" - but going all the way back to the Vietnam war.

NBC: The four service members being flown from the Middle East to Dover Air Force Base were 28-year-old Angel S. Rampersad of New York, 30-year-old Michael Emmanuel Swinton of North Carolina, 25-year-old Tyler James Feehan of Hawaii and 19-year-old Isabella Gonzales of Texas.

President Trump attends a dignified transfer on Wednesday. War Takes "Toll" on White House: WSJ

The war is said to be taking a heavy "toll" on Trump and his top officials. According to more of what's also been glaringly obvious for anyone who has had a shred of independent thought:

The war is splitting the conservative coalition over which Trump once had an iron grip, worrying some Republicans close to the White House. Longtime Trump allies such as Fox News host Laura Ingraham have used their platforms to express concerns about how the war might affect Republicans in November’s midterm elections. On Monday, she said the “clock is ticking” to the midterms.

“Netanyahu has led us into a horrible conflict filled with lies,” Steve Bannon, a longtime Trump adviser, said. “People can see with their own eyes what’s going on.”

While this part about Netanyahu is true, it is ultimately President Trump who made the decision, after for years prior - and especially on the campaign trail - articulately spelling out that attacking Iran and starting new Mideast wars would be one of most idiotic foreign policy moves a president could make.

Trump on Thursday said he would take funds from Iran to pay for damage inflicted on US bases and assets throughout the war. Iran responded in the following...

Seizing another nation's assets to pay for unrelated future claims is an incendiary precedent.

Those who celebrate or profit from such funds should remember: once governments normalize confiscation, no one's assets are safe. Ensuing chaos will not be pretty or peaceful.

— Seyed Abbas Araghchi (@araghchi) July 24, 2026

Perhaps the utter folly of Operation Epic Fury has finally begun to dawn on the president. WSJ also observed that "Last month, the president was so excited at the prospect of signing the memorandum of understanding with Tehran to reopen the Strait of Hormuz that he was dismissive of Republican allies who said the Iranians would never stick to the agreement, according to a senior administration official. He wanted it to be over, Trump told them."

Tyler Durden Fri, 07/24/2026 - 12:45

Nine Potential Commodity Wildcards As "Once-A-Decade" Shocks Become New Normal

A growing number of institutional desks sounded alarms over physical commodity markets this week as maritime chokepoint disruptions intensified across the Gulf.

Goldman Sachs, RBC Capital Markets, JPMorgan, and others warned that a tightening physical market could keep Brent firmly in triple-digit territory and drive prices sharply higher if the disruptions persist.

Joining the conversation was Citigroup Senior Commodities Strategist Eric Lee, who warned Thursday that commodity markets have entered an era of near-constant disruption, with geopolitical, climate, and technological shocks increasingly overwhelming traditional supply-and-demand analysis.

Lee warned:

Commodities markets are in an era where geopolitical, climate and technological shocks routinely overwhelm traditional supply-demand analysis. Rather than only what is most likely, investors need to consider what is plausible, and what markets are least prepared for.

The frequency of major commodities market disruptions appears to be rising. Events once considered "once -a-decade" now seem to emerge every year, or even every six months.

Since the early 2000s, markets have navigated the Global Financial Crisis, the Arab Spring, the US shale revolution, OPEC's strategic policy shifts; since 2020, wildcards include COVID-19, the Russia-Ukraine conflict, trade wars, gold-positive macro concerns, weather-driven agricultural disruptions, and repeated Middle East conflicts.

Timeline showing notable wildcards and shocks impacting commodities, 2000-2026

List of notable wildcards and shocks impacting commodities:

Lee outlined nine high-impact commodity-market wildcards for the second half of 2026 and beyond, warning that the scenarios are not base-case forecasts but risks with consequences too large for investors to ignore:

1. US-Iran conflict goes from temporary shock to multi-year disruption of Gulf oil production capacity, driving crude oil to $150+, wholesale refined products to $200+, US retail gasoline to $6/gal sustained.

2. Russia-Ukraine escalation drives renewed oil and gas export restrictions: this could be even more bullish for global gas than for oil.

3. Critical minerals hoarding goes into overdrive: drives copper to $20k/t and more.

4. Gold falls another 15–20% near-term before doubling.

5. Hyper El Niño and other extreme weather: drives ag price spikes, e.g. cocoa back to >$10k/t.

6. AI boom and bust: buffet electricity, natural gas, uranium, and power-infrastructure metals like copper and aluminium one way, and gold the other way.

7. Trade war hits US farmers again: US-China trade war resumes, hitting US ag exports, which could push corn below $4.2/bu and soybeans below $10/bu.

8. 2030 LNG glut worsens on Russian Power of Siberia 2 gas pipeline to China: driving global LNG prices like JKM down to $5–6/MMBtu.

9. Monroe Doctrine extreme: US blockades all Americas oil exports, driving global oil prices to well above $100/bbl, while US benchmarks might be discounted by over $30/bbl.

A look at the Bloomberg Commodity Index (BCOM), a widely tracked commodity-futures benchmark, shows the broader complex, spanning energy, agriculture, metals, and livestock, continuing to climb from its Covid-era lows.

Professional subscribers can access deeper commodity analysis at our new Marketdesk.ai portal.

Tyler Durden Fri, 07/24/2026 - 12:40

AI Capex Depreciation Risk Is The Catch To Record Earnings

Authored by Lance Roberts via RealInvestmentAdvice.com,

The second-quarter earnings season is in full swing. So far, the results are landing in line or better than the upwardly revised Wall Street estimates. That’s the opposite of how this usually works. Analysts normally trim their forecasts as a year wears on. In 2026, they’ve done the opposite. The S&P 500 is on track to grow earnings north of 20% for a second straight quarter. The earnings are real. However, a meaningful slice of them is also an accident of accounting timing. That timing, the AI capex depreciation risk, hasn’t hit the income statement yet. But it is about to turn from a tailwind into a headwind.

Alphabet handed investors a live example last week. The headline read earnings up 294%. Peel back a $99 billion paper gain on its stakes in Anthropic and SpaceX, and per-share earnings came in around $2.85 against a $2.88 estimate, with the core business growing a solid but ordinary 30%.6 That gain is one kind of distortion, and it can reverse the moment those private valuations move. The distortion this piece is about is quieter and larger, the depreciation bill on the AI buildout that today’s reported earnings have barely begun to absorb.

The Golden Window

Currently, the entire earnings growth story is concentrated in the semiconductor and AI-infrastructure names. The accounting underneath it is where the catch hides.2 Here is what I mean. When Nvidia sells a chip, it books the revenue and the profit almost immediately. The hyperscaler buying that chip does the opposite. It records the purchase as a capital asset and spreads the cost across years through depreciation. So the seller’s earnings jump now, while the buyer’s costs arrive later, in slow motion.

Here’s what makes this run unusual. Analysts normally walk their forecasts down as the year unfolds. Over the past five years, consensus has trimmed full-year estimates by about 2% on average at this point on the calendar.4 In 2026, they’ve gone the other way. The full-year S&P 500 earnings growth estimate has climbed from roughly 14% in February to north of 23% now, a swing of nearly nine percentage points in the wrong direction for anyone expecting the usual fade. With Q2 results landing through late July, that bar keeps moving higher.

That upward march is the golden window in motion. Every beat this quarter lifts the bar for the next one, and the more confidently the Street marks earnings higher, the more those forward numbers lean on costs that haven’t shown up yet. Make no mistake: this is the same setup I flagged in “Earnings Estimate Revisions Are Very Optimistic.” The AI capex depreciation missing from today’s numbers is exactly what those rising estimates are quietly assuming away.

Todd Castagno at Morgan Stanley calls this “a golden window where everybody looks good.”2 He’s right. Revenues and margins look strong among chipmakers and the companies buying the chips at the same time, which is exactly the kind of broad, simultaneous strength that convinces investors a cycle is durable rather than borrowed from the future. Make no mistake, there’s nothing improper here. This is how companies book capital assets. What’s different this cycle is the sheer scale of the spending, and the eventual AI capex depreciation is being overlooked.

Where The Bill Actually Lands

Here’s the problem with the everything-is-fine read. The spending is enormous, and it shows up in cash long before it shows up in earnings. The five biggest hyperscalers, Alphabet, Amazon, Meta, Microsoft, and Oracle, spent about $412 billion on capex in 2025.2 For 2026, the estimates run to roughly $760 billion.2,3 Yet the AI capex depreciation and amortization that those companies expect to recognize against all that spending in 2026 is only about $211 billion.

Read those two numbers again. They’re spending $760 billion and expensing $211 billion. The other $549 billion sits on the balance sheet, waiting. It becomes an earnings cost later, once the equipment goes into service and the AI capital depreciation clock starts. A good chunk of it isn’t even running yet, because the data centers housing it are still under construction.

The cleanest way to see the gap is the cash. For 2026, combined free cash flow at those five companies is projected to fall 91% to about $16 billion, while net income is projected to rise 25% to roughly $506 billion.2 A business can report half a trillion dollars of profit and throw off almost no cash in the same year. That’s not fraud. That’s depreciation timing. You don’t have to wait for the full-year math to see it. In the second quarter alone, Alphabet spent $44.9 billion on capital projects, more than double a year earlier, and its free cash flow swung to negative $5.9 billion even as it booked $40.8 billion of operating income.6 The cash is already walking out the door. The reported profit hasn’t flinched.

The Number Nobody Can Model

However, here is where it gets interesting. If depreciation is the future cost of today’s earnings, you’d want analysts to have a tight handle on it. They don’t. Look at the consensus estimates for Meta in 2028. The standard deviation of the revenue forecasts is just 4% of the average. The standard deviation on the depreciation-and-amortization forecasts blows out to 24%, six times wider.2 Translation: analysts broadly agree on what Meta will sell. They have almost no agreement on what it will cost to run the machines that produce it.

Why so uncertain? A few reasons. Most of these firms only shifted from asset-light to capital-heavy models in the past few years, so there’s little history to model against. Companies also have wide latitude to lengthen or shorten the useful lives they assign to equipment, and that single assumption swings the annual depreciation number significantly. On top of that, a growing share of the buildout is financed off-balance-sheet. As David Zion of Zion Research Group puts it, consensus depreciation estimates “could be systematically understated.”2 

You can already hear the pressure building in the guidance. On last week’s call, Alphabet’s finance chief told analysts the infrastructure ramp will keep weighing on the income statement through higher depreciation expense.6 Management knows the bill is coming. What nobody can pin down is how large it gets.

That table is the entire bull case in five rows. The market isn’t paying for the $16 billion. It’s paying for the snapback to $387 billion. And the snapback is an assumption, not a result.

“You’re paying 22 times earnings today for profits whose single biggest future expense the analysts modeling them can’t agree on within a quarter of a trillion dollars. That’s the catch.”

“But The Revenue Will Come”

Let me steel-man the optimists, because they aren’t wrong about everything. The consensus view holds that capex growth tapers after 2026 while revenue keeps climbing, so free cash flow rebounds in a clean “V.” The same forecasts that show $16 billion in free cash flow this year also show it recovering to $185 billion in 2028 and $387 billion in 2029, with earnings compounding at around 20% a year through the end of the decade.2 If that plays out, today’s multiple looks reasonable in hindsight, and the depreciation wave gets buried under a bigger revenue wave.

Put real numbers on the bet. Consensus has the five hyperscalers’ capex climbing from $412 billion in 2025 to roughly $760 billion this year, then to about $820 billion in 2027 and $930 billion in 2028.2,5 Watch the growth rate, not the level. Spending jumps 84% into 2026, then the annual increase collapses to single digits. That deceleration is the entire argument. If capex growth stalls while net income keeps compounding near 20% a year, free cash flow snaps back on its own, because the cash stops rushing out the door faster than it comes in. The chart below is the bull case drawn to scale.

It’s a coherent story. It also leans on a capex taper the same companies have run straight through at nearly every guide. Each time the Street pencils in a slowdown, the next quarter’s guidance lands higher. The 2026 consensus alone climbed from about $600 billion last November to $760 billion by February.3 So the model that gets you back to $387 billion of free cash flow assumes spending discipline from an industry that hasn’t shown any. Last week made the point again. Alphabet lifted its 2026 capital budget to as much as $205 billion, up from $190 billion just a quarter earlier, and told investors to expect spending to rise significantly again in 2027.6 That is the opposite of a taper.

Maybe. But notice everything that case requires. It needs capex to slow on schedule, revenue to accelerate on schedule, and depreciation that everyone admits they can’t model to behave itself along the way. Bob Farrell’s Rule #9 has aged well for a reason. When all the experts and forecasts agree, something else usually happens. The V-shaped recovery isn’t a forecast. It’s an assumption wearing a forecast’s clothes.

The issue is NOT whether AI is real. It is. The issue is whether the price already paid assumes a clean landing that the people closest to the numbers can’t promise.

What This Means For Your Portfolio

So what do you do with it? Start with the multiple. The S&P 500 trades around 22 times forward earnings, above its historical average, and that’s before the depreciation wave ramps.1 If the forward earnings inside that ratio are flattered by deferred costs, then the real multiple on fully loaded earnings is higher than the sticker says. You’re paying more than it looks.

I made a related point last month in Earnings Estimate Revisions Are Very Optimistic. Strip AI infrastructure out of the index, and the other 470-odd companies have seen their 2026 earnings estimates revised lower over the prior 17 months. This is the same warning from a different angle. The index’s earnings engine is concentrated in a handful of names. Notably, a chunk of those names’ reported profits carries a deferred bill that the consensus is probably underpricing. Concentration risk and earnings-quality risk are now stacking on top of each other. I walked through the valuation side of this in Parabolic Semiconductor Rally Is Pricing In 2028 Already as well.

While we continue to hold AI infrastructure positions. But we also continue to manage that risk. We will trim the names that have done the most work, hedge the largest exposures while protection is still cheap, and you keep dry powder for the first real disappointment. Howard Marks has spent a career making the same point. The riskiest moment is usually the one that feels the safest.

The AI capex depreciation wave is coming. That part isn’t in dispute. The only open questions are how big it is, when exactly it lands, and whether the revenue arrives in time to absorb it. Right now, the market is answering all three with optimism and pricing the answer as though it were already known. When the first hyperscaler guides depreciation higher than the Street modeled, the golden window closes fast. Better to position for that before the tape forces the issue.

Tyler Durden Fri, 07/24/2026 - 12:20

Russian Attack On Arms Expo Near Kiev Kills 10, Just After Zelensky Hosts Raytheon Execs

Russia just escalated against Western backers of Ukraine in a big way. On Friday a major Russian missile strike was carried out in Kyiv Oblast where representatives of Ukraine's defense industry had gathered for a demonstration event.

These types of defense tech gatherings occur semi-frequently, are somewhat secretive, and typically involve American and European defense companies demonstrating new weapons systems, particularly in the realm of drone warfare. These events also sometimes involve the Ukrainians showing off their own advancing capabilities to international customers.

Handout image of defense expo strike aftermath.

So bottom line is that in targeting the event, Russia is strongly signaling it is willing to strike locations known to potentially have Western officials present. It may be lashing out after the US reportedly agreed (tentatively at least) to give Ukraine licensing rights to produce its own Patriot missile defense shield.

The Friday ballistic missile strike near the Ukrainian capital killed 10 people and injured almost 100 others.

The timing is interesting given the attack came a mere day President Volodymyr Zelensky met nearby with with senior representatives of Raytheon, the US company that produces Patriot air defense systems. Raytheon has yet to provide public comment or confirm whether any of its representatives were at the event. The Thursday delegation was headed by Raytheon Vice President Joseph DeAntona.

Zelensky in a meeting with a delegation Raytheon in Kiev on Thursday. Handout via Ukrainian Presidential Press Service

Zelensky has said an investigation is underway amid public outrage, given the gathering seemed to lack legitimate operational security and secrecy, and seemed to be 'out in the open'. It was a rare daytime attack, but the precise location has not been disclosed by local authorities. But the event was reportedly openly advertised on social media.

Some details have been revealed via local media:

According to Ukrainska Pravda portal, a site on which a technology event took place has been targeted by a Russian attack. It has been confirmed by the Ukrainian Council of Defence Industry that Russian forces carried out a missile strike on a site in Kyiv Oblast where representatives of Ukraine’s defence industry had gathered. It was a practical demonstration event, Defense Demo Day & Defense Expo Critically Protected, organized by ARMADA, Association of Manufacturers of Unmanned Systems and Associated Technologies. As stated by the organizers, the purpose of the event was to present comprehensive solutions for protecting critical infrastructure from modern aerial threats.

"An investigation will establish who made the decision to hold the event... and whether the risks were properly assessed under martial law," prosecutor general Ruslan Kravchenko announced in the aftermath.

🇷🇺💥🇺🇦 Russian missiles struck the "Armada" arms exhibition in Kapitanovka, Kiev region, held on the grounds of the "Civil Safety Academy" shooting range. The event showcased small arms, drones, and combat gear for Ukraine's military and defense industry — vendors, buyers, and… pic.twitter.com/TCJjZ1yX08

— DD Geopolitics (@DD_Geopolitics) July 24, 2026

Previously explosions were widely reported in the capital area, and residents were called on to stay in shelters as air defense systems were operating.

"A rescue operation is currently under way in the Kyiv ⁠region following a Russian missile strike," Zelensky further announced on Telegram. Acting ‌governor of Kyiv region Ruslan Oliynyk affirmed that a ballistic missile ‌strike hit a private training ground while defense expo events were ⁠taking place.

Just the day prior at the presidential office...

Met with a Raytheon team led by Vice President Joseph DeAntona. Raytheon is a very strong defense company, and Ukraine has long been using its equipment to protect our people from vicious Russian attacks.

I am grateful for the company’s readiness to take our partnership to an… pic.twitter.com/zPqXdQp5ig

— Volodymyr Zelenskyy / Володимир Зеленський (@ZelenskyyUa) July 23, 2026

Al Jazeera's Audrey MacAlpine is in the Ukrainian capital, and she has pointed out: "It’s quite irregular for Russian attacks, especially ballistic ones, to take place during the daytime hours so this marks something new."

Tyler Durden Fri, 07/24/2026 - 12:00

Gas Prices Nearing Levels That Could Push Trump Towards Iran Talks, Says JPM Commodities Expert

One of the main macro drivers this week remains the Gulf energy shock, as chokepoints from the Strait of Hormuz to Bab el-Mandeb are disrupted. Turmoil in the Black Sea between Russia and Ukraine is also sending chills through commodities desks.

Related energy coverage:

• RBC Commodities Chief Warns "War Entering Dangerous Phase" As Chokepoint Chaos Risks Oil Above 2008 Peak

Brent crude is back above $100 a barrel, while WTI has reached $92, pushing Treasury yields higher, tightening financial conditions and weighing on duration-sensitive and consumer-facing stocks.

At the start of the week, AAA data showed that while prices vary across states...

... the national average for regular gasoline had exceeded the politically sensitive threshold of $4 per gallon.

And going higher...

JPMorgan's head of Global Commodities Research and Strategy, Natasha Kaneva, told clients that Brent should average about $94 a barrel if the conflict is contained to one month, with each additional month of disruption adding roughly $7 to $8 as global inventories shrink.

Kaneva warned that a three-month disruption could lift Brent to around $114, while a 1 million barrel-per-day recovery in Chinese imports would add another $3 to fair value.

Related:

• Three Levers China Is Pulling To Weather Gulf Energy Shock; How Long Can Beijing Hold Out?

Under her base case, Brent averages $86 in Q3 and $80 in Q4, allowing gas prices to fall from just under $4 in August to about $3.30 by year-end.

However, she noted that another month of disruptions across the maritime chokepoints would push pump prices toward $4.20, while a two-month extension could lift them above $4.50.

Kaneva also pointed out that the $4.20 and $4.50 thresholds are where the Trump administration would likely face intensified political pressure to negotiate with Iran.

In the previous round of escalations, negotiations were initiated once US gasoline prices reached $4.20 and became materially more urgent as prices neared $4.50 (Figure 10). Oil may be a global commodity, but political tolerance for high energy prices remains overwhelmingly domestic

Separately, gasoline above $4 represents a line in the sand at which working-poor consumers begin trading down at convenience stores and gas stations, while broader sentiment shifts to the downside, which only means the political pressure heats up for Trump when gas prices rise north of $4.

Tyler Durden Fri, 07/24/2026 - 11:20

Trump Must Hand Over Finance Records Sought By BBC In Defamation Lawsuit, Judge Rules

Authored by Rachel Roberts via The Epoch Times,

A judge in Florida has ruled President Donald Trump must hand over financial records sought by the BBC for its defense against his $10 billion defamation lawsuit.

The U.S. president is suing the corporation over an episode of “Panorama” that edited together different sections of his speech on the day of the Capitol breach in Washington on Jan. 6, 2021.

The BBC reported that Judge Enjoliqué Lett granted a motion by the corporation’s legal team to compel the release of financial records held by the Donald J. Trump Revocable Trust, created to manage his businesses while he is president.

‘Partial Success’

The judge’s ruling at Tuesday’s opening hearing in Miami can still be appealed, but the BBC said it amounts to a “partial success” in its attempt to force Trump to provide evidence for his claim that he suffered financial loss due to the Panorama edit.

The defamation case is currently at the discovery phase, where both sides must provide documents, internal or otherwise, that could form part of their evidence.

The corporation has produced 87,000 pages of documents, according to the BBC’s lawyers, who said Trump’s legal team had released a “sham production” of 735 pages, which they said were “news articles” and other material “pulled from the internet.”

Charles Tobin, counsel for the BBC, said this meant the discovery process had been “entirely one-sided.”

‘Fishing Expedition’

Trump’s legal team accused the BBC of a “fishing expedition” with subpoenas designed to “harass” former officials.

Alejandro Brito, counsel for Trump, described the BBC’s “sweeping” requests for documents as “oppressive.”

He opposed the BBC’s requests for records of Trump’s conversations with aides relating to the events of Jan. 6, as well as subpoenas issued to federal agencies and former officials.

The BBC said that the president’s lawyers focused on a letter of apology sent from the corporation’s chairman, Samir Shah, to Trump in November last year, describing it as a “concession” and “admission.”

Shah wrote in the letter that the Panorama episode in question had “unintentionally created the impression … that President Trump had made a direct call for violent action.”

The judge’s decision opens the door for the BBC to peruse the finances of more than 400 companies owned by the Trump family trust.

President Donald Trump looks on during a rally in Washington, on Jan. 6, 2021. Jim Bourg/Reuters

A spokesman for Trump’s legal team told The Epoch Times via email: “The formerly respected and now disgraced BBC defamed President Trump by intentionally, maliciously, and deceptively doctoring his speech in a brazen attempt to interfere in the 2024 Presidential Election.

“The BBC has a long pattern of deceiving its audience in coverage of President Trump, all in service of its own leftist political agenda. President Trump’s powerhouse lawsuit is holding the BBC accountable for its defamation and reckless election interference just as he has held other fake news mainstream media responsible for their wrongdoing.”

Motion to Dismiss

The BBC has sought to have the entire case dismissed, arguing the documentary was not broadcast in the United States. The court has yet to rule on this, but Judge Altman denied the broadcaster’s application to stay the discovery phase of the lawsuit.

In court documents released on March 17, lawyers for the BBC argued that the lawsuit could have a “chilling effect” on “robust reporting on public figures and events.”

The BBC’s flagship “Panorama” program came under scrutiny last November over an episode broadcast on Oct. 28, 2024, a week before the U.S. presidential election.

Through cutting and splicing together different sections of his speech, the documentary created the impression that Trump had encouraged violence at the Capitol building on Jan. 6, 2021, according to critics and Trump’s legal team. Protesters had gathered in Washington to show they disputed the result of the 2020 presidential election, won by Joe Biden.

The BBC’s 34-page legal document cited a “lack of personal jurisdiction” and a “failure to state a claim” among the grounds to dismiss the lawsuit.

Lawyers for the broadcaster argued that Trump’s subsequent election victory in 2024 demonstrates that no serious reputational harm was caused by the “Panorama” broadcast.

(Left) Former CEO of BBC News Deborah Turness at an event in London on Oct. 13, 2022. (Right) Former BBC Director-General Tim Davie at the BBC World Service in London on April 28, 2022. Leon Neal/Getty Images, Hannah McKay/Pool/AFP via Getty Images

Trump is unable to sue the corporation in England, as the statute of limitations for defamation is only one year. His lawyers filed the claim in the southern district of Florida, where the statute of limitations is two years, in December last year.

The BBC argues that the state of Florida has no jurisdiction because Trump cannot demonstrate that the corporation “purposefully aimed the documentary at Florida” and that it was clearly made for the UK audience.

BBC iPlayer is geo-blocked in the United States, although Trump’s lawyers have argued that it could be accessed by Americans using a virtual private network.

The BBC is funded by a license fee that is supposed to be paid by every UK household that watches live television, although the number of people purchasing a license has fallen in recent years, leading to cutbacks.

BBC Director-General Tim Davie and head of news Deborah Turness both resigned in November following the scandal over a leaked internal report highlighting apparent bias at the corporation, including the “Panorama” edit.

Matt Brittin, a former Google senior executive, took over as the corporation’s director-general in May.

Tyler Durden Fri, 07/24/2026 - 11:00

Historic Buffalo Church Torches Twice In Four Days Following Sale To Islamic Group

Authored by Steve Watson via Modernity News,

A 140-year-old Catholic church in Buffalo has been deliberately set on fire for the second time in four days, the third blaze to hit the site this year. Investigators confirmed arson.

The property was sold years earlier by the Diocese of Buffalo to a company affiliated with the Downtown Islamic Center, which planned to turn the historic complex into a mosque.

Christian heritage keeps vanishing while officials scramble over "securing" the site they already allowed to fall into the wrong hands.

The former St. Ann's Church and Shrine at 651 Broadway, built in 1886, suffered a fire around 5:45pm on Tuesday, July 21. Buffalo Fire Department crews contained it. Officials ruled the cause arson. It came just four days after a three-alarm blaze on Friday, July 17, that began in the rear of the structure.

In January, a four-alarm fire had already gutted the adjacent former school building, causing an estimated $600,000 in damage.

Here we go again...a 140-year-old church in Buffalo, New York has been torched twice in 4 days by arson. It's almost like they're erasing Christian culture, one historic flame at a time... pic.twitter.com/Y1QIadijvZ

— Liz Churchill (@liz_churchill10) July 23, 2026

The central fact is straightforward. In November 2022 the Diocese of Buffalo sold the entire complex - church, school, and convent - for $250,000 to Buffalo Crescent Holdings, Inc. The buyer is affiliated with the Downtown Islamic Center.

The stated plan was to convert the property into a downtown Islamic center. The building had stood vacant and deteriorating for years after parish activities ended in 2013. Investigations continue. At this time, no public link to the owners has been reported.

The former St. Ann's Church complex (651 Broadway, Buffalo) was sold in Nov 2022 by the Diocese of Buffalo to Buffalo Crescent Holdings, Inc. for $250,000. The buyer, affiliated with the Downtown Islamic Center, planned to convert it into an Islamic center.

The 1886 building has...

— Grok (@grok) July 22, 2026

Local officials are now expressing frustration at the predictable result. Buffalo Common Council Member and Majority Leader Leah Halton-Pope said she had spoken with the administration that same afternoon about securing the site.

"I literally just had a conversation this afternoon with a member of the administration asking what are we going to do about it and stressing that something has to be done over there to secure it, and then said it's probably going to be set on fire again, but I just didn't think it would happen today," she stated.

She called the repeated fires "disheartening" for nearby homeowners already dealing with smoke and instability. "I know it's been said that it was arson, which is to be expected."

Bernice Radle, executive director at Preservation Buffalo Niagara, was blunt: "The St. Ann's property owners are unresponsive and refuse to secure the building. Preservation Buffalo Niagara calls on the City of Buffalo to pull out all the stops to wrestle this landmark church from its negligent absentee owner. Enough is enough!"

Mayor Sean Ryan's office said the administration is "actively exploring legal options to compel the owner to fulfill the responsibility to properly maintain and secure the building."

The Department of Permits and Inspections will continue visits. Earlier this year, after the school fire, the mayor had already stated that taxpayers would not cover demolition costs estimated at $2 million. The owners have indicated they lack funds for upkeep while still aiming to develop the property as a community center for Buffalo's Bengali community.

This fits a sustained pattern of historic Christian churches burning across the West, often with causes left vague, suspects uncaught, and preservation efforts blocked.

In New York City itself, the 1863 South Bushwick Reformed Church in Brooklyn was gutted by confirmed arson in June. The FDNY ruled it intentional, and a person of interest was seen fleeing.

Pastor James E. Steward II said the loss struck generations: "It was more than just a building. It's lives and generations of lives that have been touched."

The congregation put forward a restoration plan based on an independent engineer's assessment. The New York City Department of Buildings rejected it. Demolition was ordered.

Just months earlier, a 138-year-old church in Astoria, Queens, suffered a five-alarm blaze whose cause was listed as "unknown." Rebuild proposals were rejected. The structure was demolished within weeks.

The same template appears across the border and overseas. In Canada, arsons against churches more than doubled after 2021. A Macdonald-Laurier Institute report found fewer than 4 percent of cases resulted in charges. Over 100 churches have been burned or vandalized since then, including the 1893 church in Saint-Romain, Quebec, confirmed as arson in April. Officials treat most as isolated or unresolved.

In France, nearly 50 fires or arson attempts struck churches and Christian sites in a single recent year - a sharp rise. A Christian religious building disappears every two weeks through fire, collapse, or deliberate damage.

In June a 17th-century chapel in Brittany lost most of its roof. The same day a historic cloister attached to a cathedral in Condom suffered heavy damage to its roofing and archives.

Earlier the Église Saint-Cyriaque in Montenach was gutted. Authorities routinely cite vegetation, wind, or accident. The cumulative effect is the steady erasure of Christian landmarks.

In the United Kingdom the contrast is sharper. A historic London church, the Kings Hall Methodist Church in Southall, burned to the ground in February amid near-total government silence.

Churches face more than ten crimes every day. Figures show hundreds of attacks, including arson, over recent years.

Yet when a security incident occurred at a Manchester mosque during Ramadan, Prime Minister Keir Starmer expressed outrage, thanked emergency services, and announced tens of millions in taxpayer funding for mosque and Muslim community security. No equivalent urgency followed the church fires.

The pattern is consistent from Brooklyn to Buffalo to Quebec to Brittany to London. Historic churches burn. Causes are ruled arson or left "under investigation." Suspects are rarely identified. Preservation plans are rejected. Demolition follows.

Selective official outrage appears only when other sites are involved. Christian heritage is treated as expendable while demographic and cultural shifts accelerate under open-border policies that prioritize new arrivals over the continuity of the civilization that built these landmarks.

The 1886 structure in Buffalo still stands, damaged but not yet leveled. Investigations continue. The owners remain unresponsive on security. Local residents live with the repeated smoke and uncertainty. Across the West the same quiet attrition continues - one historic flame at a time.

Your support is crucial in helping us defeat mass censorship. Please consider donating via Locals or check out our unique merch. Follow us on X @ModernityNews.

Tyler Durden Fri, 07/24/2026 - 10:20

US New Home Sales Rise For First Time In 3 Months As Prices Near 5-Year Lows

With Case-Shiller reporting existing home price declines in half of America's largest cities, and despite a weaker homebuilder confidence print, New Home Sales were expected to rebound from April and May's ugly declines... and they did, but only very modestly.

New home sales rose 1.6% MoM (+4.8% MoM exp) marking the first rise in three months, but May's 7.3% MoM decline was revised up to a mere 4.3% MoM decline.

However, this bounce was not enough to get annual sales positive (still down 5.6% YoY)...

Overall, new home sales have really gone nowhere for four years (but on the bright side, they are not as bad as existing- and pending-home-sales)...

It seems lower mortgage rates (admittedly having risen for the last month) did nothing to help move new home sales, and now they are on the rise again...

Median new home prices dropped for the second month in a row, back near their lowest levels since 2021...

The decline in homebuilder confidence still has a long way to go to catch down to homebuyer confidence...

Unfortunately, the decline in price is more than offset by the recent reacceleration in mortgage rates, leaving Trump's affordability push dead in the water.

Tyler Durden Fri, 07/24/2026 - 10:13

US PMIs Mixed But Still Signal Accelerating Economic Growth In Q3

With 'hard data' trending weaker, today's preliminary July PMIs offer the first glimpse at whether the reignition of the Iran War is weighing on 'soft' survey sentiment in the US economy.

The data was mixed (as always) with Manufacturing disappointing while Services accelerated more than expected:

• Flash US Manufacturing PMI: 53.8 (June: 53.9). 4-month low.

• Flash US Services PMI Business Activity Index: 53.6 (June: 51.2). 8-month high.

“US businesses reported a good start to the third quarter," said Chris Williamson, Chief Business Economist at S&P Global Market Intelligence, adding that "the ‘flash’ PMI survey data broadly consistent with GDP growing at an annualized 2.0% against a 1.2% pace signalled for the second quarter."

The month saw an encouraging return to hiring by companies, with employment rising for the first time in three months.

“However, some of this improvement may prove shortlived as July saw hospitality spend boosted by the FIFA World Cup and USA 250 anniversary activities," warned Williamson.

It was also worrying – though not unexpected – to see manufacturing growth weaken as some of the stock building seen in prior months showed signs of fading.

Instead, July saw a concerning intensification of supply chain delays and accompanying renewed upturn in price pressures, constraining growth and subduing demand.

But Williamson concludes on a more worrisome note, saying that “events over recent days in the Middle East will have only further exacerbated these supply chain and price worries" raising downside risks to the near-term outlook for the economy, "hinting that July’s upturn may not be the start of an improving trend.”

Tyler Durden Fri, 07/24/2026 - 09:53

Yet Another Wildberries Facility - Russia's Amazon - Goes Up In Flames After Ukraine Drone Strike

Another large warehouse and logistics hub for major online Russian retailer Wildberries has been targeted and struck by Ukrainian drones.

This is the third time in a week the company widely considered to be the 'Russian Amazon' has seen its warehouses go up in flames. At least eight of its shipping facilities have been attacked overall this month. Wildberries co-founder Tatyana Kim confirmed the fresh attack on company facilities Friday morning:

Kim, Russia's wealthiest woman, said Wildberries facilities in St. Petersburg and the surrounding Leningrad region, as well as in annexed Crimea, were hit overnight. Fires broke out at several locations, though Kim said "parts" of the warehouses were saved.

While Kim said none of the company's employees were injured, Leningrad region Governor Alexander Drozdenko wrote in a post on Telegram earlier in the morning that three people were hurt during the attack in his region.

Moscow Times via Telegram

Operations at these facilities have been halted, while all personnel a the impacted warehouse in Crimea have been evacuated.

The St. Petersburg attack resulted in especially dramatic scenes of a huge smoke plume stretching high into the atmosphere, and even visible from space, NASA satellite imagery showed.

It was just last week that the company's warehouses in central Russia were struck, which killed eight people. In the face of the Kremlin calling the attacks acts of terrorism and war crimes, Ukrainian President Volodymyr Zelensky has claimed that the hubs were "involved in providing the Russian army with drone components, navigation equipment and other gear."

The Wildberries facilities have been increasingly targeted amid broader nightly drone waves out of Ukraine, with a separate Friday attack in the Kirov region killing at least six people.

Anadolu/Getty Images

NBC News has noted, "Wildberries, whose banking arm had sanctions imposed on it by the European Union this week over its financial contribution to the Russian budget, plays a central role in Russia’s consumer economy."

"Its targeting by Ukraine appears to be part of Kyiv’s attempts to ensure ordinary Russians feel the impact of the war which has raged on Ukrainian territory for more than four years," the report adds.

The company says it is working around the clock to restore service to areas impacted by the warehouse attacks. 

Stunning footage of Wildberries hub fully on fire from earlier this week in Krasnodar:

Clear view of the entire Wildberries hub in Krasnodar fully engulfed in fire. https://t.co/PcQN5uFauU pic.twitter.com/I8jn0BAtAM

— Special Kherson Cat 🐈🇺🇦 (@bayraktar_1love) July 22, 2026

Reuters has reviewed that "Together with smaller rivals, Wildberries and Ozon sell goods and services worth the equivalent of 8.5% of Russia's gross domestic product. They provide jobs for 4 million people, or more than 5% of the country's workforce."

Tyler Durden Fri, 07/24/2026 - 09:40

"It's Getting Worse": HSBC Warns Commodities Face Squeeze As Chokepoint Chaos Spreads

The key takeaway heading into the weekend is that maritime chokepoint chaos has spread from the Strait of Hormuz to the Bab el-Mandeb Strait, while fighting across the Black Sea has intensified between Russia and Ukraine. The widening disruptions have prompted several institutional desks this week to warn that a potential squeeze on physical commodity markets could send prices from energy to agricultural goods higher.

"The Middle East conflict has escalated, putting a substantial squeeze back into commodity markets," Paul Bloxham, HSBC's chief economist for Australia, New Zealand and global commodities, wrote in a note on Friday morning.

Bloxham continued, "Traffic through Hormuz has almost stalled again, and the disruption has spread to the Bab el-Mandeb Strait, the key access point for the Red Sea, for Saudi oil going to Asia and Europe-Asia trade through the Suez Canal."

Bloxham warned that with Brent trading above $100 a barrel and strategic petroleum reserves being rapidly depleted worldwide, energy markets face a mounting risk of a "super-squeeze."

His message was blunt: "It's not over yet," adding, "Hormuz, Mandeb, oil at 100 ... it's getting worse. "

Here's more:

The Brent oil price has risen sharply, to over USD100/b recently; European and Asian gas prices are more than 40% m-o-m; refined product prices, like jet fuel and diesel are surging; urea prices are up 13%; and wheat prices are at a three year high – all on supply constraint concerns. With inventory rundown having been a key adjustment factor preventing much bigger prices spikes earlier in the conflict, and stocks now much lower, concerns about 'tank bottom' levels and non-linearities are expected to come back into focus. It's a 'super-squeeze'. And it's not over yet.

Bloxham also highlighted the market mechanics that prevented Brent from spiking even higher a few months back, including US strategic reserve releases and China's reduction of oil imports and SPR.

But he warned that these buffers are finite and can suppress the price shock for only so long:

As we have actively written about over the past few months, a key reason that commodity prices – particularly oil – did not spike higher earlier has been active reduction of inventories, particularly with the US release of strategic reserves and in China, where oil imports have been drawn down (see 'Better, but the Hormuz disruption is not over yet', 25 June 2026; and 'Hormuz is reshaping commodity markets', 25 May 2026).

However, the challenge is that inventory reduction can only provide an offset for so long.

At some point, concerns about stocks falling to critical levels may show up in non-linearities in markets (see Hormuz still closed: Beware Strait non-linearities, 28 April 2026). However, even with a deep-dive looks at measured stocks and supply pathways, it is hard to be definitive about when reserves will reach these critical levels. Commodity markets are highly adaptable, and when the demand is there, flexible markets often find a way to deliver. Aggregate price benchmarks also only go so far. In the face of acute supply shocks, commodity markets tend to fragment, with many different prices for the same products in different locations and for different delivery times (see More fragmentation as Hormuz blockage continues, 13 April 2026).

That said, the longer the disruption is in place – and the recent escalation suggests it is, indeed, going on for longer – the more likely it becomes that commodity prices will spike higher, in non-linear ways, as stocks are depleted.

A growing list of institutional commodity desks, including Goldman Sachs, RBC Capital Markets and JPMorgan, has warned that the expanding maritime chokepoint crisis is entering a more dangerous phase.

Helima Croft, RBC's head of global commodity strategy, cautioned that the "war enters a dangerous phase with the Red Sea and critical infrastructure at risk."

These desks have raised their near-term Brent forecasts as the disruption spreads. Goldman commodities strategist Daan Struyven warned that Brent could exceed $120 a barrel in the fourth quarter if the Hormuz crisis persists.

Related:

• Oil's Next Move Hinges On Three Variables
• The Oil Time Bomb: How To Play It

With the US national average for regular gasoline now above $4 a gallon, the energy shock has crossed a politically sensitive level (again), which could increase pressure on the Trump administration to pursue a diplomatic off-ramp.

Tyler Durden Fri, 07/24/2026 - 09:20

Braggawatts, Cheap Chinese Compute, & Simple ROI

Authored by Peter Tchir via Academy Securities,

With weakness in chips and AI the prior week, that was a major topic of conversation, as was the escalation in Iran (please see Academy’s Geopolitical Analysis for the latest on Iran and geopolitics more broadly).

Two key themes from last weekend’s From Trinkets to Compute seem to be playing out:

Cheap Chinese Compute

Most importantly, the story of Cheap Chinese Compute is garnering staying power. While DeepSeek may have been a one-off, the story is increasingly about China delivering Cheap Compute. We have seen China flood/control markets in the past. I didn’t see it coming in compute (at least not yet), but it might be here?

• China doesn’t have to deal with NIMBY, but they do make a lot of chips (generally lower quality, but a lot), and have been ramping up all forms of electricity production and storage for years. The U.S. is finally getting on board with this ProSec™ theme, while the rest of the world is only starting to wake up to the need and potential opportunity that adopting a ProSec™ mindset delivers.

• On the less “savory” side are “allegations” (and I’m being polite here) that a lot of the Chinese compute trains by “distilling” from existing models (inundating existing models with requests, to somewhat “copy” their answers) rather than training their models from scratch. It is a big cost advantage and time saving mechanism.

Earnings

Less important was my flipping from “earnings will matter” to “earnings might not matter.”

We don’t really spend a lot of time on single stock earnings. It isn’t our “thing” in general. But we do follow the earnings. What we can say so far on this front is that when the earnings and announcements hit the tape, they seem very strong. The instant reaction in the media (and social media) tends to support the strength of the results. Then the stocks seem to drift lower (in some cases worse than drift). 

The earnings bar seems to be set incredibly high, so far.

This is concerning when trying to determine the direction of the next leg.

Braggawatts

I’m not sure how I missed the term Braggawatts, but it caught my attention when my friends at ZeroHedge sent out a tweet that used the term.

The Next Phase Of Shrinkflation: Rolling Blackouts https://t.co/dYmR3d7Kn9

— zerohedge (@zerohedge) July 20, 2026

• Basically, braggawatts is a term used to express skepticism over how much in the data center and AI space can be physically constructed (i.e., in the real world) versus all the existing announcements and expectations of future announcements.

  • From access to chips, to water, to electricity, to getting all of the various state and local regulatory approvals, the argument is that a lot more compute has been announced than can be completed within the timeframe of the announcements.

  • This is consistent with some anecdotal evidence of cost and time overruns on projects (that is something we were hearing about more frequently than in the past).

If braggawatts are real (we need to explore this more):

• This should be good for credit spreads in the sector. The logical conclusion would be to announce fewer new projects and prioritize existing projects.

• Would be bad for the “picks and shovels” in the AI / Data Center industry.

Simple ROI.

To a large degree, return on investment analysis surrounding AI and the AI spend has been minimal in my view.

• On the one side you have a “build it and they will come” mentality (often the “only” risk has been described as not building enough, fast enough – which hardly encourages traditional scrutiny of costs versus revenue).

• On the other side, no CEO in their right mind would say anything other than that they were launching AI initiatives within their firm to capture efficiencies. The cost of compute has gone up. Actually, let me rephrase that, companies are being charged a cost of compute more in line with the cost of producing the compute than they were before. While the cost of providing compute seems to be increasing (shortages, etc.) part of what users are seeing is that the price that was subsidized to encourage use and to create moats (to the extent moats can be created and held) is being subsidized less. Increasing, and we’ve been writing about this for months, we are moving from “we have to try AI, or be left behind” to “we’ve been using AI, now let’s analyze the cost benefit of that.” Is that why some of the token utilization charts are showing declines from the peak?

If I’m right and some of these forces connect, it could bring pressure to bear on the space. That is “fine and normal.” What concerns me is how much money has flown into passive vehicles in the space, and how many leveraged products there are in the space. Not just the very large SOXL (which is index based) but also a lot of individual stocks in this have leveraged ETFs. 

I fear that this is a risk that can and will accentuate moves to the downside (just like it does on the upside).

Bottom Line

The escalation in Iran is not good for my view on potential rate cuts. While my outlook on inflation wasn’t entirely dependent on the free flow of oil (including more oil that had previously been sanctioned), it helped a lot.

On the AI front, I’m positive on credit spreads, but remain vigilant on valuations. The recent reaction in markets to what seemed like strong earnings releases only accentuates that concern.

Tyler Durden Fri, 07/24/2026 - 09:00

NANO Nuclear And Fortil Advance Critical KRONOS Fuel System

NANO Nuclear Energy has pushed another critical piece of its KRONOS MMR program toward preliminary design, this time with French engineering group Fortil.

If there's a corner of the French industrial sector that America should be comfortable leaning into, their nuclear segment is arguably the safest bet. Their 57-reactor fleet, accounting for 70% of the country's electricity generation, is only surpassed by the US and Chinese commercial fleets.

The companies said conceptual design work is nearly complete on the reactor’s Fuel Handling & Storage System, which will manage the safe handling, storage and movement of nuclear fuel throughout operations. The work includes defining subsystem interfaces, evaluating engineering solutions and producing documentation needed for the next design stage.

It’s not the most glamorous part of a reactor, but it’s the sort of picks-and-shovels engineering that separates a reactor rendering from an operating nuclear plant.

Fortil’s dedicated nuclear team is handling multidisciplinary work across mechanical and systems engineering, nuclear safety, instrumentation and control, and radiation protection. The consultancy has more than 2,500 employees across 30 offices in 14 countries, giving NANO access to an international engineering bench as KRONOS moves toward potential fleet deployment.

The milestone follows the NRC’s formal acceptance of the KRONOS Construction Permit Application for a full-scale reactor at the University of Illinois Urbana-Champaign. The agency began formal review activities in June, with environmental and safety evaluations expected to progress through 2027. Initial construction could begin in the second half of next year.

NANO’s story has increasingly become about more than a single reactor. The company recently acquired Secured Transportation Services for $13 million, turning itself into a revenue-generating nuclear logistics operator. That business helped execute a record 1.7-metric-ton HALEU shipment from Japan and supported the removal of highly enriched uranium from Venezuela.

The U.S. has secured its largest-ever HALEU fuel shipment, working in partnership with Japan. This significant transfer advances President Trump’s strategy to restore America's energy dominance and power next-generation nuclear reactors. https://t.co/h5Oc6f5kRq pic.twitter.com/EG7kA9Eopg

— NNSA (@NNSANews) May 7, 2026

The company is in the midst of an aggressive and wide-ranging expansion plan with business segments across the nuclear value chain. In just the past year, they’ve advanced a proprietary HALEU transportation package, won a U.S. Air Force innovation contract, and signed an agreement with Supermicro targeting nuclear-powered AI data centers. Additional partnerships are targeting South Korea, the Gulf region and a potential 1-gigawatt Texas data center campus.

Tyler Durden Fri, 07/24/2026 - 08:25

Futures Rebound As Brent Dips Below $100

US equity futures are seeing a modest rebound after posting their biggest drop this month, as Brent crude dropped back under $100 a barrel, and bond yields and rate hike odds - which track the price of oil one to one - halted their ascent. As of 6:00am ET,  S&P 500 futures rose 0.3%, with the index still on track for its first back-to-back weekly loss since the early stages of the Iran war. Tech stocks remained under pressure as South Korea’s memory and Japanese chip giants were pummeled. Treasury yields hovered just below their highest levels this year, while Brent fell more than 3% toward $97 a barrel.

In premarket trading, Tesla leads gains among Mag 7 stocks after the electric vehicle maker plunged about 15% on Thursday (Tesla +1.3%, Microsoft +1.1%, Alphabet +0.7%, Meta +0.7%, Amazon +0.5%, Apple +0.2%, Nvidia -0.4%)

• Amkor Technology (AMKR) rallies 11% after the company announced a $1.5 billion multi-year binding agreement with Nvidia to develop advanced semiconductor packaging and test technologies for next-generation AI and accelerated computing platforms.
• Intel (INTC) gains 4% (well below the kneejerk surge 12% higher) after the chipmaker’s third-quarter forecast was much stronger than analysts’ expectations. The results highlighted both the durability of AI-related demand, as well as the success of Intel’s turnaround.
• MaxLinear (MXL) slides 11% after the semiconductor device company reported second-quarter results that were only modestly ahead of expectations. While its third-quarter revenue forecast was stronger than expected, its view for adjusted gross margin was largely in line at the midpoint of the range.
• Oracle (ORCL) is up 2.6% after the software company said it had been awarded a 10-year IDIQ contract by the US Department of Defense under its Enterprise Software Initiative. The contract is valued at $3.31 billion for the first five years and up to $6.99 billion if options are exercised.

In other corporate news, SpaceX is said to have started to turn away satellite operators seeking dedicated rides to orbit aboard its staple Falcon 9 rocket beyond 2028, underscoring the massive bet Elon Musk is making on its unproven Starship. The pause on Paramount Skydance’s takeover of Warner Bros. Discovery has been extended two weeks to Aug. 17 by the federal judge in California
PayPal shares fell in extended trading following a Wall Street Journal report that Stripe is in talks to acquire startup OpenRouter
JPMorgan is said to have moved more than 30 quant researchers from mainland China to Singapore and Hong Kong.

Traders are moving cautiously after a week in which stocks and bonds were rattled by the intensifying war in Iran, soaring oil prices and fresh concerns over whether massive investments in AI will pay off. Investors are now bracing for a weekend that could bring further escalation in the Middle East, ahead of a stack of earnings from AI hyperscalers next week.

Michael Hewson, analyst at iForex, said he was surprised by how well markets are holding up despite the sharp increase in oil prices. As for earnings, “next week is a really big week and it could be make-or-break in terms of where markets go next,” he said. “There’s an awful lot more nervousness now about capex, particularly when you’re talking about AI and where’s the return on investment coming.”

To be sure, investors are contending with a growing wall of worry over AI spending, rising competition from Chinese frontier models, and increasingly crowded positioning. Amid soaring Chinese competition with open models which some accuse of being offered at dumping prices, the cost of tokens has tumbled and erased the entire recent "agentic" surge;  not surprisingly, stock prices of hyperscalers have followed suit.

Die-hard tech bulls got some good news on Thursday when Intel delivered a revenue forecast that shattered Wall Street estimates as booming data center spending fuels a long-awaited turnaround. The company forecast sales of $15.8 billion to $16.8 billion in the third quarter, with even the low end of that range easily clearing the $15.1 billion average analyst estimate.

On Thursday, Brent surged above $100, Oil headed for a weekly surge with Brent trading above $100. President Trump said damage to ships and cargo would be paid for by Iranian funds frozen by the US after new strikes by Houthi rebels. Trump also threatened to step up strikes on Iran.

“Were it not for the resurgence of the conflict in the Middle East, the picture would have looked encouraging,” wrote ING economist Bert Colijn. “As uncertainty returns, renewed (though mild) stagflationary pressures are likely to weigh on the euro-zone economy over summer.”

In tariff-related news, the US will collect duties of between 10% and 12.5% on imports from most major trading partners, its biggest move yet to reconstruct Trump’s tariff wall - this time under Section 301 of the Trade Act of 1974 - that was pierced by the Supreme Court, which nullified Section 122 duties that expire today.

Elsewhere, volatility dispersion has performed well since the end of March given a crush in implied correlation. The S&P 500’s top 50 basket has been one expression of the trade which tactical and systematic players entered prior to earnings reports for the first quarter. However, extremely low implied-correlation levels have some investors concerned about a reversal. Hence, there has been some unwinding of positions and, indeed, contrarians entering tactical "reverse dispersion" trades — buying index volatility, and selling single-stock volatility.

Sebastian Raedler, head of European strategy at Bank of America, cautions the global equity picture is “not bullish,” and investors aren’t being compensated for risk. “Margin expectations at an all-time high, you’ve expected five-year forward earnings growth at an all-time high, you’ve got market cap-to-GDP globally at an all-time high and you’ve got risk premia at a 20-year low — what the market is pricing is a scenario where everything goes right and there are no risks,” Raedler said in a Bloomberg TV interview.

A quick note on earnings: EPS growth in the US and Europe is looking better than expected at this early stage of the reporting season, according to JPMorgan strategists. With about a quarter of companies having reported, JPM's Mislav Matejka says earnings growth is at +23% y/y in the US, and +22% y/y in Europe. That implies a positive surprise factor of 13% and 2%, respectively. Looking at actual beats and misses, of the 129 S&P 500 companies to have reported thus far, 85% have beaten analysts’ forecasts, while 11% have missed. 71% of companies have positively surprised on sales, while 14% have missed. Around 170 index constituents are due to release earnings next week which will be the busiest of earnings season.  

In Europe, the Stoxx 600 climbed 0.5%, led by gains in software stocks after SAP SE reported better-than-expected sales for cloud products; SAP was the region’s most significant outperformer on its latest results, while Finland’s Valmet surged after announcing it is mulling a demerger. Here are the biggest movers Friday:

• SAP shares rise as much as 6.8%, bouncing back from a more than 30% drop since the start of the year, after the software company reported 2Q cloud backlog growth that beat estimates
• Valmet surges as much as 29%, the most on record, after the Finnish process technology firm announced it is evaluating a potential separation of its two core businesses into two standalone publicly listed companies
• Acerinox shares rise as much as 10%, hitting their highest level since 2008, after the stainless steel firm reported second-quarter earnings that comfortably beat expectations and outlined guidance for the third quarter
• Metso shares rise as much as 6.7% after the industrial machinery maker reported better order intake from its Minerals arm than expected, with Jefferies flagging the figure was much stronger than what has been reported by its peers
• Atoss Software shares rise as much as 7.5%, with Jefferies analysts saying the workforce management software company delivered earnings ahead of expectations in the first half and raised its Ebit margin goal for 2027
• Arcadis shares rose as much as 12% to €44.08 on Friday after the Dutch engineering firm said it is reviewing a second unsolicited proposal from WSP Global for all outstanding shares at a price of €51.50 per share in cash and WSP stock
• Volkswagen shares fall as much as 3.2% after the German carmaker cut its revenue forecast for the full year and after posting what Morgan Stanley described as a tough quarter
• Carrefour shares fall as much as 7.8%, the most since June 2025, after the French supermarket operator reported recurring operating income for the first half-year that missed the average analyst estimate
• Mapfre shares declined as much as 6.1%, most since March, after the Spanish insurer reported net income for the first half-year that missed the average analyst estimate. The insurer has also announced an acquisition in the US
• Neste falls as much as 11% after the Finnish energy company reported disappointing second-quarter earnings. Analysts say adjusted Ebitda was 2% below consensus, but the performance for its Renewable Products division was a bright spot
• Ipsen shares fall as much as 4.3% after the French biopharma company said its experimental treatment for a rare infant liver disease failed to meet the primary endpoint in a late-stage trial
• Sanofi shares drop as much as 3% after the French pharmaceutical company ended clinical development of amlitelimab, an experimental drug for atopic dermatitis

Sentiment got a boost after UK consumer confidence climbed six points to minus 17, the largest increase since November 2023, according to GfK’s indicator. Sentiment is now back to levels last seen in January. Meanwhile, bond traders, economists and even BOE staff are warning of QT’s impact, as pressure mounts on gilts from the return of hostilities in the Middle East and the arrival of a new prime minister with big spending promises.  Still, escalating tensions in the Middle East threaten to scupper the optimism once again. 

Asian tech shares fall sharply following Thursday’s Mag7 selloff amid growing doubts on popular AI trade’s durability. Kospi plunged about 5%, led by another crash in SK Hynix, and Nikkei falls almost 3%. The MSCI Asia Pacific Index fell as much as 2.5%, paring its gain for the week to 0.9%.

Elsewhere, Hang Seng, Shanghai Composite and Taiex indexes all tumbled. Samsung and SK Hynix dropped almost 8% each, among the biggest drags on the gauge along with TSMC and Kioxia. A look at the past 10 days of SK Hynix trading in Korea shows just how broken "price discovery" has become:

• 7/12: -2.31%
• 7/13: -16.95%
• 7/14: +6.18%
• 7/15:  +4.17%
• 7/16: -9.50%
• 7/20: +0.60%
• 7/21: +1.68%
• 7/22: -2.24%
• 7/23: +6.39%
• 7/24: -8.12%

The losses tracked declines in the Magnificent Seven overnight on worries over the durability of the AI trade.  “A second wave of geopolitical tension and tariffs landing back on the table just when markets had convinced themselves the worst was over is reviving inflation and growth concerns simultaneously, while the AI, chip and technology trade has lost much of the momentum that previously helped hold the region together,” said Hebe Chen, a senior market analyst for Vantage Global Prime.

In FX, the dollar is tightly rangebound against most majors. The yen hovered around 163.80/USD.

In rates, treasury 10-year yield adds a basis point to 4.71% as sovereign bonds remain under pressure. Australian 3-year yield jumps more than 10 bps. JGB futures decline following Japan inflation uptick.  European bonds across the region staged a rebound after days of losses. The average yield on the Bloomberg Global Treasury Index — which tracks investment-grade government bonds — surged to 3.68%, surpassing a peak from three years ago to reach the highest since the global financial crisis in 2008. Treasury 10-year yields rose a basis point to 4.70%, while bonds fell in Japan, Australia and New Zealand.

Asian stocks fell, with the Kospi index sliding more than 4%, and benchmarks in Japan and Taiwan also dropping more than 2%. The Magnificent Seven technology behemoths suffered their biggest one-day drop since the tariff tantrum in April 2025 on Thursday. Intel shares rose in US post-market trading after its revenue forecast shattered estimates, indicating that booming data center spending is helping fuel a long-awaited turnaround.

In commodities, WTI crude futures hover around $91.50 while Brent contracts remain above $100 a barrel. Gold eases to near $4,030 an ounce. 

Market Snapshot

Top Overnight News

• Trump imposes forced labor tariffs, drawing protests from trading partners. EU's Kallas questions US rationale for tariffs on bloc, seeks clarification. Brazil says US tariffs related to forced labor are 'arbitrary' and 'unjustified': RTRS
• Stocks Get Some Relief as Brent Slips Below $100: BBG
• Trump Is Losing Patience Over an Iran War With No Clear End in Sight: WSJ
• Trump vows to punish Iran and Houthis for attacks in Red Sea: AP
• Iran flew IRGC commanders, missile gear to Yemen's Houthis: RTRS
• The Houthis Have Opened a New Front in the U.S.‑Iran War: WSJ
• UK says armed forces ready to defend country after Iran warns over US bombers: RTRS
• Iran strikes on CIA facilities prompt questions about possible Russian role: RTRS
• US to Use Iran’s Frozen Funds to Pay for Ship Damage, Trump Says: BBG
• SpaceX Is Turning Away Falcon Customers in Major Bet on Starship: BBG
• Inside China’s All-Out Push to Catch Up With American AI Chips: WSJ
• Canada to mark Gordie Howe bridge opening without US after trade war deepens: RTRS
• Overseas Buyers In Hot Pursuit of US Crude as Wars Escalate: BBG
• Samsung, SK Hynix to Ink Large Chip Supply Deals With US Firms: BBG
• ECB Officials Avoid Clear Hints on Possible Hike for Now: BBG
• VW Sees Another Sales Drop as China Decline Complicates Turnaround: BBG

A more detailed look at global markets courtesy of Newsquawk

APAC stocks followed suit to the losses on Wall Street where the Nasdaq was heavily pressured following Alphabet and Tesla earnings, while sentiment was also weighed on by rising oil prices and yields as geopolitical escalation continues. ASX 200 retreated with underperformance in tech and miners leading the downside, while the improvement in Australian flash PMIs did little to spur a rebound. Nikkei 225 fell beneath the 65,000 level with tech stocks heavily pressured and over-represented in the list of worst performers, while inflation data did little to shift the dial and printed in line with expectations. KOSPI suffered the brunt of the tech selling with sidecars activated on the KOSPI and KOSDAQ. Hang Seng and Shanghai Comp conformed to the broad downbeat mood with notable pressure in miners and tech stocks.

Top Asian News

• Japanese Inflation Rate YoY (Jun) Y/Y 1.7% vs. Exp. 1.7% (Prev. 1.5%).
• Japanese Core Inflation Rate YoY (Jun) Y/Y 1.6% vs. Exp. 1.6% (Prev. 1.4%).
• Japanese Inflation Rate Ex-Food and Energy YoY (Jun) Y/Y 1.7% vs. Exp. 2% (Prev. 1.8%).
• Japanese Inflation Rate MoM (Jun) M/M 0.3% vs. Exp. 0.2% (Prev. 0.4%).
• Japanese S&P Global Composite PMI Flash (Jul) 53.10 vs. Exp. 52.8 (Prev. 52.8).
• Japanese S&P Global Manufacturing PMI Flash (Jul) 54.7 vs. Exp. 54.5 (Prev. 54.8).
• Japanese S&P Global Services PMI Flash (Jul) 51.9 vs. Exp. 53 (Prev. 52.2).
• Australian S&P Global Composite PMI Flash (Jul) 52.6 vs. Exp. 50.1 (Prev. 50.4).
• Australian S&P Global Manufacturing PMI Flash (Jul) 51.7 vs. Exp. 51.1 (Prev. 51.5).
• Australian S&P Global Services PMI Flash (Jul) 53.0 vs. Exp. 50.2 (Prev. 50.5).

European bourses start the final trading day entirely in the green, with outperformance in the IBEX 35 and DAX 40, given positive earnings from SAP and the rebound in European banks. Supporting the equity space is the lower energy prices, possibly as investors take profits heading into the weekend. On the data front, flash PMIs surprised to the upside across the EZ and the UK. The commentary broadly highlighted the cooling of cost pressures, however, while noting that inflationary pressures remain elevated. Another caveat is that the survey period was between the 9th-22nd July, which doesn't include the recent return of Brent above USD 100/bbl. Sectors point to a mixed, but slightly positive, picture. Tech tops the sector pile, with Financial Services and Banks rounding out the top 3 sectors. Telecoms is the sector laggard, followed by Energy and Autos. Two of Germany's biggest companies reported earnings before the market open. Starting with SAP, its Q2 revenue and cloud revenue beat estimates, with its cloud business increasing 24% Y/Y. This is driving the majority of gains, printing gains in excess of 6%. In terms of guidance, its FY adj. operating profit shifted EUR 100mln lower to 11.8-12.2bln (prev. guided 11.9-12.3bln). On the other hand, Volkswagen reported its Q2 metrics. Revenue beat estimates; however, the Co. cut its FY revenue guidance to between -3% and 0% (prev. guided 0-3%). Co. execs highlighted the increased competitiveness in China, with vehicle sales falling 31.6% in the region. The CFO also stated that current planned initiatives are not sufficient to compete in China. As such, shares have fallen by over 1.5%.

Top European News

• German Chancellor Merz said Nina Warken will be appointed chief of staff and Linnemann will be appointed health minister. Merz added that further cabinet changes in the future, but will take more time.

FX

• G10s are entirely firmer (excl. NOK) against the Buck, which has been offered throughout the morning, likely due to some profit-taking after gains in energy on Thursday. Generally a risk-on environment with high-beta Antipodeans outperforming.
• DXY weakened throughout the morning as crude succumbed to profit-taking after Brent Sept'26 gained c. 7%, and DXY saw gains of 0.3% on Thursday. Another factor potentially is the fresh US tariffs being lower than feared, also exempting oil, gas, fertiliser and foodstuffs. DXY fell from its 101.46 session high to a trough of 101.25. The 21DMA is below at 101.05 before support at 101. The US calendar is light, with the first read for July's PMI scheduled, where EZ figures released this morning were stronger than expected.
• EZ PMIs saw modest EUR strength following the French figure, which was extended by a couple of pips after Germany; Bunds were unreactive. EUR was lacklustre overnight in the wake of the ECB, though attempted a bounce towards 1.14 following the strong PMI read, foiled just above that level.
• Much stronger than expected UK Retail Sales had little follow-through to Sterling amid World Cup/weather related demand, with the purchase of Fans and Football shirts influencing the figure. Pantheon Macro still looks for consumer spending to ease to 0.1% quarter-to-quarter across H2, with a reversal in the aforementioned components likely to weigh. Elsewhere, UK composite PMI surprisingly rose to expansionary by a decent margin, though the strong caveats of the data not encompassing the recent geopolitical escalation saw the handful of pips strength in EUR/GBP pared. GBP/USD lifted from the 1.33 mark to a session high of around 1.3350.
• Barclays' month-end rebalancing model indicates a weak USD buying signal against most majors by month-end. The model suggests moderate bearish signals for CAD and GBP.
• US Treasury said no major US trading partner manipulated its currency to gain an unfair trade advantage in 2025, while 10 leading trading partners remain on a list for enhanced monitoring of their foreign exchange practice. The Treasury added that yen weakness has persisted despite narrowing of US-Japan interest rate differentials and excess volatility in the yen is unwanted.

Fixed Income

• A contained start for most benchmarks as Brent held at just over USD 100/bbl throughout APAC trade and into the European morning. Thereafter, as energy pulled back from highs taking Brent down to a USD 98/bbl handle, yields followed suit and by extension fixed lifted.
• At most, USTs to a 108-09 peak, notably shy of Thursday’s 108-15 best and while firmer by c. five ticks today, it remains near enough a full point lower WTD. Ahead, we have Flash PMIs which will help to inform the debate around the Fed tightening this year or not, though as we have seemingly seen with the EZ figures it is perhaps too early for the energy resurgence to be fully visible in the flash data.
• Bunds lifted to a 124.46 peak around the cash equity open, spurred by the mentioned energy move and as the German Cabinet reshuffle was relatively limited and as expected. Since, a kneejerk lower occurred on the French flash figures before more pronounced pressure after the German and EZ metrics. Albeit, energy continues to trim and and the c. 10 tick pullback has unwound, with Bunds back at highs and firmer by over 20 ticks.
• Moving to Gilts, the morning’s stronger than expected Retail Sales were overshadowed by the mentioned pullback in energy and as such Gilts opened on the front foot by 17 ticks and have since extended another 30 to a 86.36 peak, where it remains.
• On the morning’s data, the EZ PMIs were firmer across the board aside from France’s Manufacturing. Commentary was encouraging and pointed to a rebound after a “largely stagnant” Q2 (reminder, Flash Prelim. EZ GDP next week) and cost pressures “cooling sharply”. However, the survey period only runs until the 22nd of July, and as such misses out on around USD 6/bbl of additional Brent upside if we assume that day’s USD 95.63/bbl close was captured, but equally the open that session was USD 91.50/bbl which may more closely align with the responses being provided, and would equate to around USD 10/bbl of upside being missed out on since.
• A similar point can be made for the UK Flash PMIs and also the DMP. As such, the Final reads will draw more scrutiny than usual to see how respondents' views changed once the energy extension to over USD 100/bbl was accounted for.
• Australia sells AUD 900mln 3.25% April 2029 bonds b/c 3.56, avg yield 4.6752%.

Commodities

• Geopolitics have shown no signs of abating, although a fresh escalation outside of the daily strikes is yet to occur. To briefly recap the main geopolitical points, the US and Iran continued to exchange strikes, with CENTCOM conducting a 13th night of attacks on Iranian military targets and Iran targeting neighbours. US President Trump said Iran wants to reach an agreement but is not yet ready. Further, Iran reportedly rejected a US ceasefire proposal presented by Iraq’s PM, while Tehran also refused to amend a separate 10-day ceasefire plan linked to discussions over the Strait of Hormuz. Crude has been pulling back from yesterday’s extremes despite a lack of a clear driver during the European morning. Against the backdrop of a lack of fresh escalation today, traders could be booking profits in oil heading into another uncertain weekend. Further adding to the downside could be trade war woes after the Trump administration imposed new tariffs of 10-12.5% on imports from 60 countries over claims that they had failed to prevent forced labour, with China condemning unilateral tariffs this morning.
• WTI and Brent futures are softer by over 3% after surging some 6-7% intraday yesterday, with the former toward the lower end of a USD 88.75-90.66/bbl range and the latter back under USD 100/bbl in a USD 96.51-101.19/bbl range. Dutch TTF is choppy but ultimately flat at the time of writing around the EUR 62/MWh mark after finding support at EUR 61/MWh.
• Precious metals see some reprieve from the pullback in the energy space. Spot gold rebounded from a USD 4,022/oz intraday low and currently resides towards session highs of USD 4,053/oz. Spot silver sees more momentum after hitting a low near USD 57/oz yesterday before rebounding to a current USD 58.42/oz peak today.
• Base metals are flat/mixed and fail to benefit from the pullback in energy amid pressure from tariff woes. 3M LME copper resides in a narrow USD 13,574.88- 13,683.63/t range.
• South Korea extended fuel tax cuts through to September 30th, with the government maintaining 15% gasoline and 25% diesel tax reductions.

Trade/Tariffs

• US Trade Representative Greer announced 10 to 12.5% new tariffs related to forced labour, while exempting oil, gas, fertiliser and food stuffs from the labour tariffs. Countries that implemented forced labour prohibition get 10% tariff rate, those that have not get 12.5%.
• China's Foreign Ministry said it opposes all unilateral tariffs, saying its position on China-US economic and trade issues are clear.
• EU's Kallas said the new US tariffs on EU goods are not really grounded, and questioned the forced labour rationale, while she stated the US tariff move is a negative surprise after the EU kept its side of the trade deal. Furthermore, she said the EU was not expecting to be included in new US tariffs and that officials will seek clarifications from Washington on the new tariffs.
• Mexico's President Sheinbaum said Mexico and the US are making progress regarding the USMCA review, while Mexico's Economy Minister Ebrard said that they see no change in the effective tariff that Mexico pays, following the US announcing new tariffs.
• Brazil's government rejected the US 12.5% tariffs on Brazilian goods related to forced labour, calling the tariffs completely arbitrary and unjustified, while it will start procedures to use its reciprocity law and will take the matter before the WTO's dispute settlement mechanism.
• Japan's Trade Minister Akazawa said the US's latest move on tariffs is regrettable, and confirmed that the US will not go beyond the 2025 tariff deal.
• Canadian PM Carney said everything is on the table if Canada and US fail to reach a deal on the latest US tariff threats, adds Canada has not signed a partial USMCA deal as talks remain focused on critical sectors

Central Banks

• BoJ is expected to keep rates unchanged at its meeting next week, while it is likely to maintain its inflation overshoot warning and is seen signalling easing inflation risks at the July meeting, according to sources. Additionally, the Nikkei reported something similar, stating that the majority of members currently favour a steady approach, citing a desire to monitor the impact of June's hike amid geopolitical tensions and inflation risks and that many suggest that there is no rush to raise rates.
• ECB's Nagel said the ECB is in a good position to closely monitor further developments.
• ECB's Simkus said uncertainty has been evident over the past six weeks and oil over USD 100/bbl will have repercussions. The inflationary environment has increased with risks to the upside. Simkus added that there is no value in rushing but sees a higher probability of a hike than a hold.
• ECB's Kocher said the recent developments in oil markets are concerning and said a 50bps hike was not discussed and hopefully something ECB will not have to consider.
• ECB's Sleijpen told Econostream that the ECB could hike in September even without second-round effects as long as the broader inflation outlook warrants it. He said second-round effects are important, but will assess the entire inflation outlook. There is no evidence of second-round effects yet. Markets understand the reaction function and decision triggers. From a cyclical perspective, the economy has held up reasonably well. Neutral rate estimates are not a decisive factor in setting policy. Conditions are again more consistent with the June baseline.
• ECB Consumer Expectations Survey (Jul): Median consumer perceptions of inflation over the past 12 months decreased significantly, as did the next 12 months.
• BoE Monthly Decision Maker Panel data: Expectations for 1yr-ahead CPI inflation fell to 3.4% in the three months to July (prev. 3.7% in the three months to June); 3yr-ahead CPI inflation expectations was 2.8% in the three months to July (prev. 2.9%).

Geopolitics: Middle East

• US President Trump posted "Please let this statement serve to represent, until further notice, that from this point forth, any and all damages done to Ships, Cargo, or anything related thereto, will be paid for by Iranian Money". However, N12's Ravid commented that it is unclear if Trump has the legal ability to do such a thing, adding the president can freeze Iranian funds in the US, but using them to pay private shipping companies would likely require a court decision or new legislation.
• US President Trump is said to be losing patience over an Iran war with no clear end in sight, while he has grown skeptical of diplomacy and is in ‘revenge mode’ against Tehran, according to a senior administration official cited by WSJ.
• US CENTCOM said forces started another night of strikes against Iranian military targets, adding this is the 13th consecutive night of strikes aimed to hold Iran accountable and diminish threats from the IRGC to commercial shipping.
• Explosions were reported in Iran's Taft, Shirkuh, Isfahan, Jask and Konarek. There were also reports of explosions in Khorramabad, Bandaa Abbas, Qeshm, Larak Island and Hengam.
• Iran's army said it has launched another wave of drone attacks against US military facilities in Kuwait. Earlier, there were reports of explosions at US bases in Jordan and the Sheikh Isa airbase in Bahrain.
• Iran reportedly rejected the US ceasefire deal presented by Iraqi leader, according to the NYT.
• Iranian diplomat said Iran has not closed the door to diplomacy, and messages are still being exchanged through intermediaries, ISNA reported.
• Iran's Foreign Minister Aragchi said seizing another nation's assets to pay for unrelated future claims is an incendiary precedent. He also said that "perhaps before the war a compromise could have been made. But now, for reasons that I do not want to open up too much, compromise has become difficult."
• US President Trump reportedly told Lebanese President Aoun he would seek to curb Israeli escalation in Lebanon and support expanded US assistance to the Lebanese army, Saudi newspaper reported. In other reports in IRIB, US President Trump reportedly gave Lebanese President Aoun an ultimatum during the latter's visit to Washington, stating either coordinate and destroy Hezbollah or return to Netanyahu's nightmare.

Geopolitics: Russia-Ukraine

• Ukrainian President Zelensky told Trump ally Laura Loomer that he may visit Washington next week and plans to meet President Trump again.
• US Senate eyes a vote on Russia sanctions package next week, according to Axios.

Geopolitics: Other

• China's Coast Guard said it imposed control measures on several Philippine vessels operating "illegally" in the waters around Scarborough Shoal.

US Event Calendar

• 9:45 am: Jul P S&P Global US Manufacturing PMI, est. 54.4, prior 53.9
• 9:45 am: Jul P S&P Global US Services PMI, est. 51.5, prior 51.2
• 9:45 am: Jul P S&P Global US Composite PMI, est. 52.15, prior 51.9
• 10:00 am: Jun New Home Sales, est. 607k, prior 580k

DB's Jim Reid concludes the overnight wrap

I'm coming to terms with the fact that my wife and kids are this morning leaving me for 5 days to go camping on a mums and kids only trip. How will I cope with the pain and sadness of being alone for such a long time? The answer: Golf tonight, tomorrow morning, tomorrow afternoon, Sunday morning, Sunday afternoon, and maybe Monday and Tuesday evening after work. If I can walk on Wednesday, I'll be impressed. My wife genuinely thinks I won't be able to cope on my own and has left a meal plan and dossier of instructions. I'm not quite sure how she thought I coped in the 36 years I lived on the planet before we met.  

As we approach my lost weekend, the two big themes in financial markets all year, namely Iran and AI, have combined in a negative direction to leave a challenging 24 hours for markets and potentially threatening time spent on the beach for many in the days ahead, and remaining weeks of Summer. The sell-off certainly wasn't helped by Brent crude surging back above $100/bbl as peace in Iran looks distant for now.

The latest is that Trump said to Axios that he was “considering a massive attack” and was “close to making a decision”. And earlier on, he posted that if the Houthis continued to make strikes, then “major military punishment will be inflicted upon Iran” as well. In turn, Tehran warned that it would retaliate, including against energy facilities in the region, if Trump followed through on his threat to target Iranian bridges and power plants. The escalatory rhetoric raised fears of a more prolonged stagflationary shock and drove some big losses across global markets, with yields hitting multi-year highs on both sides of the Atlantic. Indeed, the 10yr bund yield (+3.1bps) hit a post-2011 high yesterday of 3.20%, whilst the 30yr real yield in the US (+2.8bps) hit a post-2008 high of 2.96%. 

The most obvious impact of the escalation could be seen in energy prices, with Brent crude (+7.04%) posting another big daily increase to close at $100.69/bbl, its highest level since May. This morning we're just a couple of tenths of a percent lower and still above $100. That stands in stark contrast to where we began the month, with Brent at around $72/bbl after the interim deal was signed and there were initial indications that the Strait of Hormuz was beginning to reopen. The jump in the 6-month Brent future (+1.80% to $83.21/bbl) was more modest, but this is now up by more than $10/bbl since early July as investors price in a more lasting shock. In the one piece of slightly better energy news, European natural gas futures (-1.02%) dipped slightly from Wednesday’s high, closing at €61.90/MWh. 

That jump for oil prices and fears of stagflation put serious pressure on global equities, with the S&P 500 (-1.21%) and Nasdaq (-2.15%) both sliding yesterday. Matters weren’t helped by Tesla (-14.52%) and Alphabet (-7.13%), which both saw large declines after their earnings release the previous day. So that drove a big loss for the Mag 7 (-4.78%) index, which posted its biggest daily decline since the week of the Liberation Day turmoil in 2025. The two big problems for the big tech companies are that capex is no longer being funded out of free cash flow alone (see page 15 of the WOW! pack here for more) and that cheaper open-source AI is seriously threatening the business model of the US AI-stack. See Adrian Cox's piece here at the DBRI on the open-source versus proprietary model battle and my CoTD here from yesterday comparing it to the Betamax versus VHS battle 40-plus years ago.

The sell-off wasn't just in the US, as Europe was hit hard by the oil shock, with the STOXX 600 down -1.18% as the CAC 40 (-1.64%), DAX (-1.56%), and FTSE MIB (-2.80%) all posted large declines.

The risk-off mood was also visible in other asset classes, with US HY credit spreads (+9bps) seeing their biggest widening since March, while the dollar index (+0.32%) had its best day in a month.  

The ongoing surge in oil prices also meant that inflation expectations crept up yesterday. In fact, the 1yr Euro inflation swap rose a further +10.9bps to 2.75%, whilst the 1yr US inflation swap (+1.9bps) was up to 2.07%. So that led to ongoing speculation that the Fed might still be about to hike as soon as next week, with the futures-implied probability of that up to 34% by the close. And it was a similar story in Europe, where 47bps of further hikes are now priced from the ECB by the December meeting up +1.1bps on the day.

Staying with the ECB, in their latest policy decision yesterday they kept their deposit rate at 2.25% as widely expected, while implying that further hikes were still likely. Both the short decision statement and Lagarde’s press conference noted that the latest outlook was broadly unchanged relative to the ECB’s June baseline scenario which had been predicated on market pricing of three hikes this cycle (so two more after the June hike). Lagarde also said yesterday that the ECB’s reaction function was "very well understood" by markets, showing no desire to push back on market pricing. Our European economists now see a September hike to 2.50% as a near done deal. Risks are clearly skewed towards a further hike thereafter, but this would require persistently elevated energy prices and/or evidence of second-round effects. See their full reaction here. 
With inflation fears mounting, sovereign bond yields hit fresh multi-year highs yesterday on both sides of the Atlantic. In the US, the 10yr Treasury yield (+3.8bps) rose to 4.69%, its highest since January 2025, whilst the 2yr yield (+4.9bps) rose to 4.34%. The gains were even clearer for real yields, where the 10yr real yield (+5.7bps) closed at 2.42%, its highest since October 2023, whilst the 30yr real yield (+2.8bps) was up to 2.96%, which is its highest level since autumn 2008 at the height of the GFC. Meanwhile in Europe, there were also several records, with the 10yr bund yield (+3.1bps) at a post-2011 high of 3.20%, whilst the 10yr OAT yield (+4.7bps) hit a post-2009 high of 4.01%. 

In trade news, overnight the Trump administration finalized the details of the new Section 301 tariffs covering some 60 of the US’ trading partners. Largely in line with what was signaled when the investigations into alleged forced labour practices in supply chains concluded last month, most of the largest trading partners including the EU, UK, Canada and Mexico will face a tariff of 10%, while others including Japan, South Korea and Australia will face a 12.5% levy. As a reminder, these duties arrive as today sees the expiry of the temporary 10% Section 122 tariffs, which themselves were announced after the Supreme Court in February struck down tariffs introduced under the International Economic Emergency Powers Act.
In Asia the negative mood continues but US equity futures are more stable. The KOSPI (-5.62%) is again leading declines and is poised to wipe out gains made earlier this week as major chipmakers follow weakness seen among their US counterparts. Japan’s Nikkei (-2.87%) is also sharply lower, extending its losing streak into a third consecutive week. In China, the CSI 300 (-1.17%) remains on course to break a four-week run of weekly losses despite today’s decline. Hong Kong’s Hang Seng (-1.27%) is also trading lower but is still positioned to record a fourth straight week of gains. The S&P/ASX 200 (-0.93%) is also lower. S&P 500 futures are down -0.08% with the Nasdaq equivalent -0.34% lower. The tech cycle mood improved a bit after a stellar earnings report from Intel which forecast that revenue in Q3 will be $15.8-16.8bn, well above the $15.1bn average estimate. Intel’s shares rose by +4.5% in after-hours trading. 

Data released earlier this morning showed that Japan’s inflation remained broadly in line with expectations in June. Core CPI rose 1.6% year-on-year, matching forecasts, while the closely watched “core-core” CPI measure eased to 1.7% from 1.8% in May, remaining below the Bank of Japan’s inflation objective and a touch below expectations. Headline CPI accelerated as expected to 1.7% year-on-year from 1.5% previously, marking its highest reading so far this year.

In Australia, private-sector activity expanded at a stronger pace in July, with the S&P Global Flash Composite PMI increasing to 52.6 from 50.4 in June, recording a second consecutive month of growth and its strongest level since the start of the year. The services PMI improved to 53.0 from 50.5, while the manufacturing PMI edged up to 51.7 from 51.5, indicating continued expansion across both sectors.

Finally, there wasn’t much data yesterday, but the US weekly initial jobless claims fell to just 187k (vs. 210k expected) in the week ending July 18, which is their lowest level since 1969. So that reassured investors about the state of the labour market moving into the summer, and kept up the hawkish pressure on Fed pricing. 

To the day ahead now we’ll get the July flash PMIs from around the world, US June new home sales, July Kansas City Fed services activity, UK June retail sales, Germany August GfK consumer confidence, Canada June industrial product price index, raw materials price index. Central bank events include the ECB’s June consumer expectations survey and the BoE’s DMP survey, whilst the ECB’s Lane will also speak. Earnings include American Express, NextEra energy, Verizon Communications, HCA Healthcare, and SLB.

Tyler Durden Fri, 07/24/2026 - 07:37

Inside Global Aerospace & Defense Boom: 12 Takeaways From World's Most Important Airshow

The Farnborough International Airshow is coming to a close in the UK, marking the end of one of the aerospace and defense industry's top gatherings. Institutional research desks have had boots on the ground, tracking commercial-aircraft orders, defense procurement and other industry trends.

A team of Citi analysts led by John Godyn attended Farnborough earlier this week and reported back to clients Thursday morning.

Their findings pointed to accelerating missile demand and a wave of new aircraft orders that could fuel a stronger and more robust growth cycle for aerospace and defense companies.

Godyn highlighted the event's key takeaways, giving clients a clearer picture of the aerospace and defense industries heading into fall and 2027:

1) Aftermarket channel checks across multiple companies extend recent strength.

We spoke with a wide range of aftermarket exposed companies including engine manufacturers, parts/component manufacturers, MROs, and aircraft lessors. Consistently, across all meetings, companies expressed the view that the key themes driving aftermarket continue including: (1) low retirement rates, (2) high lease renewals and tight secondary market trends for AC/engines, (3) strong demand for lift from global airline customers, (4) capacity constrained MROs, and (5) no impact from the conflict in the Middle-East. Given how strong recent trends have been, companies did caution that mean reversion to long term growth rates, which GE described as LDD revenue growth and many non-engine aftermarket players described as HSD revenue growth, was inevitable. We view the read-through as clearly positive across multiple stocks in our aftermarket coverage (GE/RTX/VSEC/LOAR/HEI) and EU analyst Conor Dwyer echoed that sentiment for Safran's 2026. To be fair, we note that investor expectations are already set for continued beats in this category of stock so the bar isn't obviously low.

2) M&A heating up?

Multiple companies we spoke to described an M&A backdrop that is much more active with many deals coming to market. Management teams described multiple drivers with notable emphasis on self-help activities at corporates focused on ramping production leading to non-core assets or underperforming suppliers being put up for sale, as well as PE-owned assets coming to market. We get the sense from most of our companies that the Aero M&A pipeline remains robust and multiple companies expect M&A to be a larger driver of growth. Valuations were regularly cited as reasonably full, but there remain opportunities to find deals at reasonable prices.

3) Airbus Next-Gen has been a dominant theme throughout the week.

The next generation Narrowbody Jet on the part of Airbus has been a ubiquitous theme throughout the week. GE indicated CFM collaboration with Airbus was very active on the RISE program (meeting 2x per month). Other component manufacturers expressed similarly heightened activity and discussion around the next generation Narrowbody Jet. Suppliers described conversations with BA on similar topics to be far earlier stage and having less consistent cadence.

4) GE emphasized more upside on CFM56 aftermarket $ profit and a quicker ramp on LEAP aftermarket $ profit than investors may appreciate.

GE noted that LEAP:CFM56 $ profits should be roughly equal by 2030. GE expects CFM $ profits to continue to grow until 2028 before flattening out, while LEAP $ profits continue to catch up until 2030. LEAP % margin will lag CFM56 even in 2030 and will continue to move higher as the LEAP installed base ages. We see a similar shape in our above-consensus expectations and see the possibility of additional upside as the belief that the aftermarket cycle lasts ultimately proves to be more robust than even GE management expects.

5) GE engine read-through positive.

The aforementioned CFM56:LEAP view is similar to Conor Dwyer's assumed split for Safran within the next 5 years (he is 45:55 in 2030, reaching 49:51 in 2031). Conor notes that GE was quite relaxed about the threat of rising retirements in the coming years to the CFM56 program, but did note it is managing the risk of rising USM (used serviceable materials) already with slightly slower price increases on the CFM56 vs the LEAP and acknowledged the possibility of risk in 2029-31 (this is a risk Conor highlighted here in 2028).

6) Bullishness on emerging engine technologies was palpable.

Although we did not speak to RTX, we felt that GE upped the volume on its RISE engine and is increasingly and more loudly making the case for the innovative technology. Separately, multiple EVTOL players we met with showed evidence of progress on hybrid-electric engines punctuated by a GE/BETA hybrid-electric engine which was demonstrated live and recently was the first such engine to be tested above 30,000 feet.

7) Demand for accelerating missile production was a frequent topic of conversation.

At face value, this is no surprise, but channel checks emphasized 3 interesting points: (1) targets of 3-10x growth in production by program are likely to prove low because these forecasts do not incorporate international demand, so as 'framework agreements' are definitized, the supply chain is already being asked to ramp even higher to satisfy allies' needs, (2) solutions for scalable hypersonic missile production are being requested, and (3) supplying into emerging affordable mass designs may be a bigger opportunity than initially thought. We continue to believe that Missile Defense/Munitions Replenishment are themes that will exceed expectations for years to come.

8) Positive secondary market trends supportive of aircraft lessors.

In particular: (1) a continued, favorable supply/demand mismatch in the secondary market driving lease rates higher across a wide range of aircraft types, (2) among narrowbodies, notable strength in the A321neo and 737MAX, (3) among widebodies, even greater strength in the A330neo and 787 families of aircraft, (4) a belief among lessors that existing production outlooks across the OEMs are unlikely to be a meaningful headwind to secondary market trends until the end of the decade, and (5) the view that a lack of customer support will dissuade airframe OEMs from pursuing new clean sheet designs this decade. In totality, these channel checks were not only positive for AER, but also much of our aerospace coverage.

9) Are 737 -7 and -10 certifications imminent?

Suppliers to whom we spoke expressed a tremendous amount of confidence in rate increases at BA in the short/medium-term. Suppliers also felt that events supportive of BA's case for raising rates, namely the -7/10 certifications, were likely to happen sooner rather than later.

10) ETN mentioned that Aero could be in a historic "feast" cycle.

ETN Aero Management mentioned that it expects 16 new Aero-focused platforms launching over the next ten years vs. the last big Aero cycle in the 2000s where only five were launched. The majority of the new expected platforms will be military, and ETN Management seems confident that the company can enjoy considerable content on these platforms. We sense Management is particularly excited about the Bell MV-75 Helicopter program and the Collaborative Combat Aircraft program (CCA), although these programs are still in the early stages in terms of ramp up for ETN.

11) Aero supply chain slowly healing but will be tested with further rate increases.

In general, nearly every company we spoke to described the current aerospace supply chain as healthy and struggled to identify any major problem areas. In fact, being part of the solution was cited as an opportunity by many, such as VSEC, DCO, and HEI. Separately, both PH and ETN mentioned an increased focus on dual/multi-sourcing, which is leading to greater supply chain resiliency. Anecdotes of supply chain issues don't seem widespread, and we also think Aero suppliers are increasingly leaning on improved software, electronics, and even additive manufacturing to further support the Aero manufacturing food chain. That said, the topic of defense orders using DPAS at some point in the future did come up as a risk factor that was cited as a realistic scenario that could disrupt the aero supply chain.

12) Aerospace suppliers' ability to price still strong.

Suppliers throughout the A&D supply chain described negotiations as much more focused on availability, performance, quality, and on-time delivery rather than price and margins. We get the sense that A&D suppliers will continue to outpace inflation with solid pricing and likely expanding margins without much pushback. Pricing muscle seemed to improve substantially during the COVID supply chain "crunch"" and that has allowed suppliers to continue to rea

Another potential tailwind for the defense industry emerged Wednesday, when House Republicans narrowly passed the fiscal 2027 National Defense Authorization Act, authorizing a record $1.15 trillion in military spending.

The measure passed 216-212, largely along party lines. While it is below President Trump's $1.5 trillion budget request, it still is a jump from the roughly $900 billion last year.

🚨 JUST IN: The US House has just PASSED the National Defense Authorization Act (NDAA) — with the SAVE AMERICA ACT ATTACHED — sending it to the Senate before it heads to President Trump's desk

Final vote: 216-212

7 Republican NAYs, while 6 Democrats voted YEA pic.twitter.com/LrNfKVGBZL

— Eric Daugherty (@EricLDaugh) July 22, 2026

The NDAA faces an uncertain future in the Senate, where Democrats are expected to oppose its cost and several controversial policy provisions.

Related coverage:

• "Demand Signal Is Real": US Bipartisan Senate Delegation Touts Defense Boom At Farnborough Airshow

If passed in the Senate and signed by Trump, the spending surge would provide tailwinds for defense stocks.

The iShares U.S. Aerospace & Defense ETF (ITA) has moved up and to the right, reflecting the boom in military spending as multiple wars rage across Eurasia. The global boom in defense spending has a lot more room to run.

ITA's next leg up will require a sustained upside break above the $250 level. 

Professional subscribers can read military trends notes at our new Marketdesk.ai portal.

Tyler Durden Fri, 07/24/2026 - 06:55

India's Fuel Exports Set To Soar In July As Refining Margins Jump

By Charles Kennedy of OilPrice.com,

India is on track to export the highest volume of refined petroleum products in months as refining margins have jumped with the re-escalation of the Middle East conflict.

India is estimated to ship as many as 1.55 million barrels per day (bpd) of light and middle distillates in July, per data by commodity analysts Kpler cited by Reuters columnist Clyde Russell.

The July volumes would be nearly double the fuel export volumes of just 866,000 bpd in May, when the Strait of Hormuz crisis hit crude supplies to India and the rest of Asia. In May, India saw its lowest fuel exports in four years.

The tightening fuel markets in Asia and the rest of the world added to a renewed rally in refining margins after the U.S.-Iran ceasefire collapsed two weeks ago. This has encouraged Indian refiners to ramp up refined petroleum exports.

The expected volumes in July would be the second-highest level in Kpler’s data series dating back to 2017.

Earlier this month, Kpler estimated that India’s refined petroleum exports would hit in July the highest level since September 2025 as refiners race to capture soaring margins amid tight Asian fuel markets.

India’s high export levels in July could ease some of the pressure on the Asian fuel market, but not all of it, as crude supplies from the Middle East are once again at high risk of delay.

Asian refiners that had bet on a flood of crude supply from the Middle East in August are now faced with potential delays in deliveries amid the re-escalation of hostilities, which could thwart their plans to ramp up crude processing rates in the coming weeks.

Refiners in the U.S. and Europe are operating at near capacity, but those in Asia may not see the expected increase in throughput now that the July and August loadings and delivery schedules have been upended by the re-escalation of the Middle East conflict.

Tyler Durden Fri, 07/24/2026 - 06:30