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Global attention this holiday-shortened week,will center on the US labor market, with the June employment report due on Thursday ahead of the Independence Day holiday. A reminder that the US will be 250 years old this week. Alongside that, central bank communication will be in focus at the ECB’s Sintra forum (today through Wednesday), while inflation data across Europe and activity indicators in Asia—notably China’s PMIs and Japan’s monthly data—round out a busy global calendar.

In the US, DB economists expect payroll growth on Thursday to slow to +75k (from +172k previously), with private payrolls rising by around +90k. There is some risk of seasonals pulling down the numbers as they have in recent years around this time. The unemployment rate is expected to hold at 4.3%, while average hourly earnings are seen unchanged at +0.3% month-on-month. Hours worked are also expected to remain steady at 34.3, leaving nominal income growth broadly stable.

Ahead of that, today brings the Dallas Fed manufacturing survey, while tomorrow sees the May JOLTS report, where markets will watch for any shifts in hiring, quits and layoffs amid a still subdued hiring environment. Wednesday then features the ADP employment report alongside the ISM manufacturing index (forecast 53.9 vs 54.0 previously). These releases should help set expectations going into Thursday’s payrolls. Beyond the labor market, tomorrow also sees the Conference Board’s consumer confidence index (economists expect 94.4 vs 93.1 previously).

On policy, attention will turn to Wednesday, when Fed Chair Warsh speaks at the ECB’s Sintra forum. DB economists continue to expect a relatively hawkish policy path, with two rate hikes pencilled in later this year. However, near-term guidance is likely to remain limited, leaving markets to take their cues primarily from incoming data.

Looking beyond the US, Europe’s main event is the aforementioned ECB’s annual Sintra conference, which begins today and runs through Wednesday, featuring remarks from major central bank leaders. In parallel, inflation data will be a key focus, with Spain and Belgium reporting today, followed by Germany, France and Italy tomorrow, and the Eurozone aggregate on Wednesday. DB economists expect inflation of 2.46% YoY in Germany, 2.30% in France, 3.23% in Italy, and 2.95% for the Eurozone. Switzerland will also release CPI on Thursday. In the UK, the BoE publishes its credit conditions surveys on Thursday and the DMP survey on Friday.

In Asia, China releases various PMIs in the first half of the week. In Japan, today’s retail sales (out earlier) is followed by industrial production tomorrow, where economists expect a +1.4% month-on-month increase. The highlight, however, will be the Bank of Japan’s Tankan survey on Wednesday, which is expected to show broadly steady sentiment and may reinforce the case for further gradual policy tightening.

Courtesy of DB, here is a day by day calendar of events

Monday June 29

• Data: US June Dallas Fed manufacturing activity, UK May net consumer credit, M4, Japan May retail sales, Eurozone May M3, June economic confidence
• Central banks: ECB forum on central banking in Sintra (through July 1), ECB's Lagarde speaks, BoE's Pill speaks
• Earnings: Prosus, AeroVironment

Tuesday June 30

• Data: US June Conference Board consumer confidence index, MNI Chicago PMI, Dallas Fed services activity, May JOLTS report, April FHFA house price index, China June official PMIs, UK June Lloyds Business Barometer, Q1 current account balance, Japan May jobless rate, job-to-applicant ratio, industrial production, housing starts, Germany June CPI, unemployment claims rate, May retail sales, import price index, France June CPI, May PPI, consumer spending, Italy June CPI, May PPI, Canada April GDP
• Central banks: ECB's Vujcic, Elderson, Schnabel, Cipollone and Lane speak, BoE’s Breeden speaks
• Earnings: Nike

Wednesday July 1

• Data: US June ISM index, ADP report, May construction spending, China June RatingDog manufacturing PMI, Japan Q2 BoJ’s quarterly Tankan survey, June consumer confidence index, Italy June new car registrations, budget balance, Q1 deficit to GDP, Eurozone June CPI
• Central banks: Fed's Warsh speaks, ECB's Lagarde, Vujcic, Cipollone and Lane speak, BoE’s Bailey speaks, BoC’s Macklem speaks
• Earnings: General Mills
• Other: Ireland takes on the rotating presidency of the Council of the EU

Thursday July 2

• Data: US June jobs report, May factory orders, initial jobless claims, Japan June monetary base, France May budget balance, Italy May unemployment rate, Eurozone May unemployment rate, Canada June manufacturing PMI, Switzerland June CPI
• Central banks: ECB's Cipollone speaks, BoE's Mann speaks, BoE’s Q2 bank liabilities, credit conditions surveys
• Other: US bond markets close early

Friday July 3

• Data: China June RatingDog services PMI, UK June official reserves changes, France May industrial production, Italy May retail sales
• Central banks: ECB's Lagarde, Nagel and Makhlouf speak, BoE's Bailey speaks, BoE’s June DMP survey
• Other: US Independence Day holiday (all markets closed)

Finally, looking at just the US, Goldman writes that the key economic data release this week is the employment report on Thursday. Fed Chairman Kevin Warsh is expected to speak at the ECB Forum in Sintra, Portugal on Wednesday. 

Monday, June 29 

• There are no major economic data releases scheduled. 

Tuesday, June 30 

• 09:00 AM FHFA house price index, April (consensus +0.2%, last +0.1%)
• 09:00 AM Case-Shiller home price index, April (GS -0.1%, consensus -0.1%, last -0.2%)
• 10:00 AM Conference Board consumer confidence, June (GS 95.5, consensus 94.6, last 93.1)
• 10:00 AM JOLTS job openings, May (GS 7,100k, consensus 7,288k, last 7,618k): We estimate that JOLTS job openings declined to 7.1mn in May based on the signal from online measures of job postings from Indeed and LinkUp.

Wednesday, July 1 

• 08:15 AM ADP employment change, June (GS +120k, consensus +119k, last +122k)
• 09:00 AM Fed Chairman Warsh speaks: Fed Chairman Kevin Warsh will participate in a panel discussion with the President of European Central Bank Christine Lagarde, Bank of England Governor Andrew Bailey, and Bank of Canada Governor Tiff Macklem at the ECB Forum on Central Banking in Sintra, Portugal. A moderated Q&A is expected. The event will be livestreamed. In his press conference following the June FOMC meeting, Chairman Warsh said, "The Committee thought that the labor markets were stable. There were some people around the Committee who thought that it was trending better than that, [and] trends matter more than data points." He also reiterated language from the post-meeting statement, saying, "Inflation remains elevated relative to the Committee’s 2 percent goal, in part reflecting supply shocks that have driven price increases in certain sectors, including energy... but to be clear, the Fed will deliver price stability."
• 09:45 AM S&P Global US manufacturing PMI, June final (consensus 55.7, last 55.7)
• 10:00 AM ISM manufacturing index, June (GS 54.0, consensus 53.9, last 54.0): We estimate that the ISM manufacturing index was unchanged at 54.0 in June, reflecting a slight decline in regional manufacturing surveys—our manufacturing survey tracker declined by 0.6pt to 54.4 in June—that is offset by a tailwind from residual seasonality.
• 10:00 AM Construction spending, May (GS +0.2%, consensus +0.2%, last +0.4%)
• 05:00 PM Lightweight motor vehicle sales, June (GS 16.1mn, consensus 16.1mn, last 16.1mn)

Thursday, July 2 

• 08:30 AM Nonfarm payroll employment, June (GS +130k, consensus +115k, last +172k); Private payroll employment, June (GS +95k, consensus +118k, last +120k); Average hourly earnings (MoM), June (GS +0.2%, consensus +0.3%, last +0.3%); Unemployment rate, June (GS 4.3%, consensus 4.3%, last 4.3%): We estimate nonfarm payrolls increased 130k in June. On the positive side, we estimate that the World Cup could boost payroll growth by 40k in June. Additionally, June payrolls have exhibited a consistent positive bias in initial prints over the last decade. The bias has become particularly pronounced in state and local government educational services payrolls: over the last three years, the category has been revised down by an average of 45k between the first and third releases. On the negative side, we expect a 10k decline in government payrolls outside of state and local government educational  services. We estimate average hourly earnings rose 0.2% month-over-month in June, reflecting negative calendar effects. We estimate that the unemployment rate was unchanged on a rounded basis at 4.3% in June, reflecting the stabilization in continuing claims.
• 08:30 AM Initial jobless claims, week ended June 27 (GS 215k, consensus 220k, last 215k): Continuing jobless claims, week ended June 20 (consensus 1,813k, last 1,821k)
• 10:00 AM Factory orders, May (GS -1.7%, consensus -2.0%, last +4.8%)

Friday, July 3 

• US Independence Day holiday observed. There are no major economic data releases scheduled. NYSE will be closed, SIFMA recommends bond markets remain closed.

Source: DB, Goldman

By Bas van Geffen, senior macro strategist at Rabobank

This weekend’s events cast fresh doubts over the value of the US-Iran memorandum of understanding.

On Friday, President Trump condemned the drone attack on a container ship that was transiting the Strait of Hormuz. Trump posted on Truth Social that the US had shot down three other drones, adding that “obviously, this is a foolish violation of our Ceasefire Agreement.”

What followed was a series of eye-for-an-eye strikes. The US targeted Iranian military sites in retaliation for the attack on the container ship. And on Saturday, the US hit Iran again after the country attacked a tanker transporting Qatari oil.

Both sides have since agreed to halt their attacks and have said that further peace talks in Doha must go on. Or, that is what US officials believe, at least: “Our understanding is that both sides will stand down for now and vessels can move freely.”

That news seems to be sufficient to reassure financial markets today, with US equity futures indicating a moderately positive opening of the week. But will this new pinky swear to cease all aggression be enough to convince shipping companies, insurers, and ships that passage through the strait is once again safe?

Firstly, we would ask whether the US’ understanding is the same as Iran’s? Recall that both sides were already at odds over what “safe passage” meant in the first place, after Iran warned that only ships following the routes sanctioned by the IRGC are guaranteed safe transit. And “for now” does a lot of heavy lifting in that US statement too. Is that for the duration of the memorandum of understanding? Is it until the talks in Doha this week have concluded? Or just until either side decides otherwise?

Israel’s war against Hezbollah remains another potential trigger for renewed escalation in the strait. Hezbollah has rejected the framework agreement signed by Israel and Lebanon as a “surrender of sovereignty.”

Even if a number of ships is willing to sail through the Strait of Hormuz, the likely presence of sea mines limits the capacity of the strait. The CEO of NYK Lines told the FT that “the routes available for navigation are extremely limited,” adding that traffic will not return to normal “for months.”

The war between Russia and Ukraine may exacerbate global fuel shortages. Putin admitted that Ukrainian attacks on energy infrastructure are having effect. The Russian president acknowledged that businesses and motorists are facing fuel shortages, and he indicated that problems are likely to persist due to refinery outages: “the right type of gasoline isn’t always available right now.” The government is discussing measures, including a possible ban on diesel exports.

So, uncertainty about fuel supply remains high. Together with concerns about new US import tariffs, that’s driving shipping costs to new highs.

Last month, the US administration unveiled plans for new tariffs on a range of trading partners, after the Supreme Court annulled part of Trump’s original tariff scheme. So, US companies are trying to build inventory ahead of these tariffs. Just like the frontloading seen ahead of the “Liberation Day” tariffs, this stockpiling is putting pressure on shipping costs. According to data from Drewry, the freight rate for a 40-foot container has surged to the highest in about two years.

And so, new import tariffs –or the anticipation thereof– will probably continue to put upside pressure on US inflation, thereby delaying Fed Chair Warsh’ rate cutting campaign. In fact, some policymakers are considering a rate hike as their next move. Kashkari indicated which dot in the Fed’s dot plot is his: he said that he has pencilled in one rate hike in for this year, and that he expects rates to stay on hold in 2027. The central banker then added “we’re going to have to see how no forward guidance works.” Well, not like this?

In a move bound to test the limits of the fragile Washington-brokered regional ceasefire, Israel has unleashed massive ordinance on southern Lebanon, saying it has utterly destroyed a huge underground complex built and used by Hezbollah.

Prime Minister Benjamin Netanyahu and Defense Minister Israel Katz have freshly announced that the Israel Defense Forces (IDF) completely demolished a massive Hezbollah underground fortress embedded deep beneath the southern Lebanese village of Majdal Zoun. The village itself was leveled, with the IDF having released footage showing an unusually strong explosion:

Israel says its military destroyed a 200+ meter-long underground Hezbollah tunnel in southern Lebanon. pic.twitter.com/XajqdpePGW

— Clash Report (@clashreport) June 29, 2026

The military revealed the subterranean complex spanned roughly 200 meters and plunged more than 25 meters deep - serving as a critical hub where Hezbollah allegedly assembled, stored, as well as launched Iranian-sourced suicide drones.

Notably, Israel had previously postponed the demolition following intense pressure from the Trump administration to halt all kinetic activity in southern Lebanon. However, either Israel's patience just ran out, or else Washington is secretly still giving the greenlight to move against such infrastructure.

Ahead of the detonation, Netanyahu and Katz noted that Israel did provide a courtesy heads-up to the Trump administration and to US officials representative in Lebanon.

"Troops of the 551st Brigade Combat Team and Yahalom forces, under the command of the 91st Division, destroyed an underground route located in the village of Majdal Zoun, in the security zone in southern Lebanon," the IDF spokesperson announced. 

A chief allegation is that "The compound was built using technology and knowledge from the Iranian terror regime," the IDF statement continued.  Also, as cited in Reuters, "The ?Israeli statement said the tunnel contained hundreds of weapons and ?launchers."

While the IDF has yet to issue its official post-operation briefing, it took the unusual step of warning residents in northern Israel to expect a massive, earth-shaking blast.

The military had actually escorted journalists on a propaganda tour of the complex earlier this month to showcase the scale of the threat, amid the ongoing Israeli occupation of southern Lebanon.

?? Israeli Prime Minister Benjamin Netanyahu and Defense Minister Israel Katz said the Israeli military destroyed what they described as a Hezbollah tunnel and underground infrastructure in the Majdal Zoun area of southern Lebanon.

?? They said Israel notified the United States… https://t.co/atvK4kLqmJ

— Drop Site (@DropSiteNews) June 28, 2026

Despite the nominal ceasefire, Israel is clearly signaling that it will not tolerate a Hezbollah reconstruction phase on its border, also wishing to permanently secure a security 'buffer zone' to prevent Hezbollah missiles and drones from being fired into northern Israel, something which has been happening for years spanning back to the Gaza war.

US equity futures are higher led by Tech as Mag7 leads the group higher and points to a reversal of last week’s profit-taking, as traders position for the end of the first half. A shortened week will likely focus on a speech from the Fed’s Warsh on Wednesday and payrolls on Thursday.  As of 8:30am, S&P futures are 0.9% higher as traders bought the dip after a rotation out of this year’s top-performing stocks sent the US benchmark to its second-worst week of the quarter; Nasdaq futures gain 1.2%, with both Software and Semis higher, which may be more driven by period-end reshuffling than a shift in sentiment. A mix of space, software and artificial-intelligence infrastructure names led premarket gains. Comcast Corp. jumped 23% on a plan to split its business. Cyclicals ex-Materials are leading Defensives ex-HC with the AI theme bid up across sectors. Bond yields are +1-2bp higher with the Dollar down a touch. Commodities are lower but the Energy complex is bid following another series of attacks between US / Iran; WTI back above $70/bbl, and Brent climbed 0.8% to $72.59 a barrel following weekend flare-ups between the US and Iran. While the two sides have since agreed to halt the attacks, the pace of shipments through the chokepoint has slowed, with shipowners likely to remain wary of crossing the strait. Gold / silver are down 1-2%, base metals with a slight bid, and Ags mostly lowers. Today’s macro data focus is on the June Dallas Fed activity with the balance of the holiday-shortened US week including June jobs report Thursday and ISM-Mfg, JOLTS and ADP.

In premarket trading, Magnificent Seven stocks are all higher (Alphabet +1%, Amazon +1%, Apple +0.1%, Meta +1.5%, Microsoft +1.7%, Nvidia +1%, Tesla +0.8%)

• Chip stocks are rebounding following a 5.3% decline in the Philadelphia Semiconductor Index on Friday, with equipment stocks leading gains after South Korea’s Samsung and SK Hynix set out plans to build two chipmaking plants.
• Comcast (CMCSA) is up 22% after the company said it plans to separate its media businesses from its cable-TV and internet operations, spinning off NBCUniversal and Sky into a new publicly traded company in a bid to increase value.
• Doximity (DOCS) falls 4% after BofA double downgraded the healthcare software company to underperform from buy, citing limited clarity on the near-term trajectory of margins as well as execution risks related to the pivot to AI.
• Iridium (IRDM) climbs 20% after Rocket Lab agreed to buy the company for $54 a share in a cash-and-stock transaction that puts the satellite communications company at about $8 billion in enterprise value.
• Martin Marietta Materials (MLM) slips 3% after agreeing to combine with building materials supplier Lhoist North America in a transaction valued at $13.5 billion, including debt.
• Viridian Therapeutics (VRDN) jumps 14% after the biotech said the FDA had approved its drug for treating an inflammatory disorder that affects the tissues around eyes.

In other corporate newsoOnline spending across all retailers in the US hit $26.4 billion during Amazon’s annual Prime Day sale, according to Adobe, narrowly beating the firm’s earlier estimate of $26.3 billion. The FDA approved AbbVie’s Skyrizi as the first IL-23 inhibitor approved in the US for pediatric patients six years of age and older weighing less than 40 kilograms.

In AI news, Anthropic won US approval to restore some access to its Mythos 5 model after resolving Trump administration concerns about the technology’s potential threats to national security. Google has placed limits on Meta’s use of its Gemini AI models because it could not provide as much computing capacity as the social media company wanted, according to the Financial Times. China is said to have matched Anthropic in cybersecurity, resetting the AI race, according to the WSJ. 

As the S&P 500 heads for its best quarter since 2020, one of the biggest debates is how much further high-flying chipmakers can push markets higher after an almost one-way rally turned more volatile in recent weeks. US equities are likely to enjoy another robust earnings season on the back of a “solid macro backdrop” and the AI investment boom, according to Goldman strategists. RBC Capital Markets strategists raised their 12-month target for the S&P 500 index to 8,150 points.

“It wasn’t a full-blown selloff, but more a rotation of the kind that we saw many times in the last 12 months,” said Guy Miller at Zurich Insurance. “There are strong fundamentals in terms of super-normal profits. In semiconductors in particular, there’s still clearly a supply-demand imbalance.”

As we reported over the weekend, hedge funds dumped global TMT stocks last week, with the combined total reaching its highest level in over 10 years, according to Goldman Sachs’ Prime desk. 

Deutsche Bank strategists confirmed that tech funds saw record outflows, as investors trimmed their aggregate equity positioning last week with overall equity positioning now slightly below neutral. Morgan Stanley’s Mike Wilson notes market breadth is improving as earnings recover beyond megacap tech, crude prices fall and crowded AI momentum trades in hyperscalers and semiconductors come under pressure. 

Still, US equities are likely to enjoy another robust earnings season on the back of a “solid macro backdrop” and the AI investment boom, according to Goldman Sachs strategists. And RBC strategists raised their 12-month target for the S&P 500 index.

A strong first half for stocks has historically been a good sign for the rest of the year in the market. Whether that holds again is the question in light of all the wild cards on the horizon. Despite the “chip wreck” last week, the sector is on track to post the best first half performance versus the S&P 500 ever.

The surge in market leverage, stemming in part from the massive growth of levered ETF products, retail margin accounts and hedge fund deposits at prime brokers, is stoking worries that it may exacerbate the next crisis. And an AI bust, inflation and fiscal stress are among the most alarming threats to global prosperity at present, the BIS warned in its annual report published on Sunday.

Traders will shift their focus this week to the annual gathering of central bankers in Portugal, where Federal Reserve Chair Kevin Warsh will make his public debut outside the US. Aside from hints on interest rates, questions over financial stability, including those linked to the artificial-intelligence boom, will be among the themes under discussion. Another prominent event will be the monthly US jobs report on Thursday, the culmination of the usual flurry of labor data that opens each month.

“After the hawkish pause of the Fed earlier in the month, one would have expected market exuberance to stall, but that doesn’t seem to be the case,” said Andrea Gabellone, head of global equities at KBC Securities. “That means the market believes that US exceptionalism is there to stay. It also means that the rally will likely broaden toward other corners of the market.”

Fed’s Barkin warned that inflation is too high, though he sees tentative signs that price pressures may moderate soon. The calendar for this week includes the annual central bankers’ gathering in Portugal, with an appearance by new Fed Chair Warsh, and US June jobs report on Thursday — likely to be a third straight extremely strong print, according to Bloomberg Economics.

“Our economists continue to expect a relatively hawkish policy path, with two rate hikes penciled in later this year,” noted Jim Reid at Deutsche Bank AG. “However, near-term guidance is likely to remain limited, leaving markets to take their cues primarily from incoming data.”

Europe's Stoxx 600 is edging lower, with tech outperforming in Europe too but being offset by declines for health care and consumer stocks. Tech and media stocks rise most, while construction shares lag. Here are the biggest movers Monday:

• Bridgepoint gains as much as 12%, the most since April, after the UK private equity firm announced it has agreed to buy Florida-based Kayne Anderson Real Estate in the group’s first push into the US property market
• Nagarro shares rise as much as 92% to €77.50 after Galaxy Germany, a holding company for Persistent Systems, said it plans to offer €81 per share to buy the IT services firm
• Prosus shares rise as much as 4% after the company reported strong results for fiscal year 2026 that were in line with expectations. Analysts welcome a 40% increase in the dividend
• Elmera rises as much as 3.2% after the Norwegian electricity provider agreed to sell itself to Finnish rival Fortum, which beat an earlier bid from Spain’s Audax. Fortum shares gain as much as 1.1%
• Ipsen shares climb as much as 1.9%, making them among the biggest gainers in the Stoxx 600 Health Care Index on Monday. The French company’s deal to buy Kartos Therapeutics is “strategically sensible,” according to Barclays
• Gerresheimer shares fall as much as 5.8% after the German firm lowered its guidance for the 2026 financial year, citing a challenging economic environment, some project delays on the part of customers and operational challenges
• Novo Nordisk shares drop as much as 2%, underperforming the Stoxx 600 Health Care Index on Monday morning, with JPMorgan noting an expected guidance raise is already reflected in current consensus figures

Asian markets traded higher on Monday after South Korean stocks recouped most of their losses following massive investment plans by heavyweight chipmakers. The MSCI Asia Pacific Index rose 0.2% after falling as much as 1% earlier in the session. Samsung Electronics and SK Hynix slumped more than 6% before erasing the bulk of their declines, leading to a similar move in the Kospi. In an ambitious plan aimed at cementing South Korea’s status as a technological powerhouse, the nation is planning investments of at least 1,350 trillion won ($880 billion) from companies including Samsung Electronics and SK Hynix into chips and data centers. Elsewhere, Japan’s Nikkei 225 closed 0.2% higher while benchmarks in Hong Kong, Taiwan and Thailand climbed. In geopolitics, the US and Iran agreed to stop attacking each other before peace talks resume this week over the Strait of Hormuz and other issues. 

“At this point, the market appears to be driven much more by sentiment than fundamentals,” said Kim Dojoon, chief investment officer at Zian Investment Management. “Price action has been concentrated in the large electronics names,” with developments in semiconductor pricing dynamics weighing on the outlook over time.

In FX, the Bloomberg Dollar Spot Index is little changed, with the euro holding around $1.14 and sterling hovering just above $1.32.

In rates, bond yields in the US, Europe and the UK are higher, with gilts slightly underperforming and yields up by two or three basis points across the curve ahead of a speech by would-be prime minister Andy Burnham. Treasuries are mixed, keeping yields within a basis point of Friday’s closing levels, as oil futures stabilize near four-month low with US and Iran halting attacks, while dip buyers emerge in US stocks, following a rotation out of this year’s top performers. Front-end and belly yields are slightly higher on the day, long-end tenors slightly richer, flattening 5s30s spread by around 1bp; 10-year near 4.37% is little changed, similar to bunds and gilts in the sector. IG dollar issuance slate includes five names so far; supply this week is expected to slow, with dealers forecasting $10 billion to $15 billion of sales. Treasury coupon issuance resumes next week with 3-, 10- and 30-year tenors

In commodities, WTI crude oil futures, off session highs, remain more than 1% higher; Brent climbed 0.8% to $72.59 a barrel following weekend flare-ups between the US and Iran. While the two sides have since agreed to halt the attacks, the pace of shipments through the chokepoint has slowed, with shipowners likely to remain wary of crossing the strait. Gold is down by about $40/oz to around $4,050/oz.

US economic data calendar includes only Dallas Fed manufacturing activity at 10:30am; ahead this week before Thursday are June consumer confidence, May JOLTS job openings, June ADP employment change and June ISM manufacturing. Fed speaker slate empty for the session. Chairman Warsh participates in an ECB panel event on Wednesday in Sintra

Market Snapshot

Top Overnight News

• The U.S. and Iran have agreed to end days of back-and-forth fighting around the Strait of Hormuz and resume peace talks, said officials from the U.S. and other countries involved in the negotiations.
• Commercial shipping continued to move through the Strait of Hormuz at a reduced level after recent attacks on two vessels. A handful of vessels made open transits over the weekend, according to tracking data. BBG
• China’s central bank set the interest rate on its new overnight liquidity tool at a level that was below expectations, according to people familiar with the matter, in what some economists see as a de facto rate cut that could push down market borrowing costs. The PBOC said it conducted 300 billion yuan ($44 billion) of overnight reverse repurchase agreements in open market operations on Monday. BBG
• China has expanded the list of Japanese companies and organizations on its export control list in Beijing’s latest move to curb what it describes as a “new type of militarism” from the government of Prime Minister Sanae Takaichi. FT
• Vladimir Putin expects US negotiators to visit Russia for Ukraine talks once Washington shifts focus from Iran, but rejected a proposal to halt long-range strikes. He acknowledged fuel supply problems and said he’s considering a full ban on diesel exports. BBG
• Investors have never been more eager to ratchet up their stock returns through margin loans and funds that amplify gains and losses. U.S. margin debt, or what investors borrow from their brokerages to buy securities, rose 54% to a record $1.4 trillion in May from a year earlier, according to Finra data. Meanwhile, high-risk leveraged exchange-traded funds that produce double or triple the daily move of underlying stocks are growing rapidly, as is trading in options tied to them. WSJ
• Comcast shares jumped premarket (CMCSA +24%) after it announced plans to separate into two companies with a tax-free spinoff of NBCUniversal and Sky. BBG
• The Supreme Court is set to rule on two of Trump’s most audacious gambits: his bids to oust Fed governor Lisa Cook and to roll back automatic birthright citizenship. The judges will release the final seven rulings of their term this week, starting today. BBG
• Private credit’s latest bet is Buy Now, Pay Later loans. Supporters say the consumer assets offer attractive returns, but critics worry about parallels to the subprime mortgage crisis. BBG
• Financials will kick off the Q2 2026 earnings season the week of July 13th. By the first week of August, roughly 75% of S&P 500 market cap will have reported results. Nvidia (NVDA), the largest stock in the market, will report on August 26th. GIR
• US House Speaker Johnson said he will send the Housing Bill over to President Trump on Monday: Fox News.
• S&P affirmed the US at AA+; Outlook Stable.

Iran Conflict

• US CENTCOM announced that it conducted strikes against multiple Iranian targets on Saturday, on the orders of US President Trump, "in direct response to continued Iranian aggression against commercial shipping." In retaliation, Iran's IRGC responded by hitting 8 US military installations at the Ali Al Salem air base in Kuwait and the US Navy's Fifth Fleet in Bahrain, according to IRNA. However, in the early hours of Monday, a US official said technical talks with Iran are slated to continue on all areas of the MoU, while the official added that both sides will stand down for now and that vessels can move freely.
• US official said Iranian drone and missile attacks on Kuwait and Bahrain failed and that all Iranian projectiles were intercepted or missed, according to ABC News.
• Iran cancelled technical talks with the US scheduled on Sunday and cited recent attacks on the country and a failure to meet conditions outlined in the MoU with the US. However, it was separately reported that the US and Iran agreed to halt strikes and meet this week, according to Axios citing a senior US official. Furthermore, US and Iran technical talks that were scheduled to be held on Tuesday in Switzerland, which would focus on nuclear and other issues, have reportedly been changed and will now be held in Doha on Tuesday and will focus on the Strait of Hormuz and recent escalation.
• Iran’s Foreign Minister Araghchi said the US and Israel have violated the MoU, particularly the first clause, which hinders the restoration of regional security, while he also stated that Iran seeks to implement the MoU in good faith in accordance with the principle of commitment for commitment and that they will act decisively against contract breaches.
• Mediators have reportedly set up communication channels to de-escalate any incidents with technical talks set to continue, according to reports.
• Iran's President said they will get USD 6bln from Qatar of the USD 12bln of Iranian funds that were frozen due to US restrictions within Qatar, journalist Mallick reported.
• Israeli army said it attacked 3 Hezbollah headquarters in southern Lebanon last night.
• Israeli military has received no orders to withdraw from Lebanon, according to Al-Jadeed and Haaretz, citing an Israeli military source.
• Instructions have been given to the Israeli army to reduce the destruction of homes and infrastructure in areas of southern Lebanon it controls, Al Hadath reported citing Israeli media.
• Israel destroyed a Hezbollah underground tunnel in southern Lebanon, while Israeli forces reportedly shelled a Syrian village near the Golan Heights.
• Israeli PM Netanyahu and Defence Minister Katz said the IDF will remain in the southern Lebanon "security zone" after destroying a Hezbollah underground facility.
• Iran and Oman held the first meeting on the Strait of Hormuz, within the framework of Article 5 of the MoU, Mehr reported.

A more detailed look at global markets courtesy of Newsquawk

APAC stocks began the week mixed, heading closer to month- and quarter-end, while participants reflected on the geopolitical developments over the weekend, in which the US and Iran conducted tit-for-tat strikes. Although, the sides have since agreed to halt attacks and will meet for talks this week. ASX 200 traded rangebound with the index kept afloat by strength in tech, telecoms, healthcare and the consumer sectors, while utilities, industrials and real estate lagged. Furthermore, price action was contained in the absence of any pertinent data and with the ACCC announcing that the excise tax cut on fuel is to be lowered from July 1st to August 2nd. Nikkei 225 continued its pullback from recent record highs and slipped beneath the 69,000 level amid tech-related weakness, although the index is off today's worst levels as participants also digested strong Retail Sales data. Moreover, reports that the government is to call for “appropriate” monetary policy in its basic policy guidelines, in an apparent effort to dissuade the BoJ from further hiking rates, also boosted sentiment. Hang Seng and Shanghai Comp are positive, albeit to varying degrees, with outperformance in Hong Kong amid strength in biotech and a rebound in hyperscalers. Baidu was boosted as its AI chip unit Kunlunxin targets a USD 50bln Hong Kong listing. However, the mainland was contained after somewhat mixed industrial profits data, and despite the PBoC conducting overnight reverse repo operations as flagged.

Top Asian News

• South Korea announced a new AI and chip spending package, which includes huge investment from the likes of Samsung Electronics (005930 KS) and SK Hynix (000660 KS). 
• PBoC injected CNY 157.5bln via 7-day reverse repos with the rate maintained at 1.40%, while it announced CNY 300bln in overnight reverse repos with the overnight reverse repo rate said to be 1.25% vs exp. 1.35%, according to Bloomberg.
• Japan’s government is expected to call for “appropriate” monetary policy in its basic policy guidelines, in an apparent effort to dissuade the BoJ from further hiking rates, according to Bloomberg citing a document.

European bourses (STOXX 600 -0.1%) started the day tentatively, but have gradually edged off best levels. The latest US-Iran flare up has had little impact on trade this morning, with traders ultimately focusing more on any potential disruptions to the Strait rather than fresh strikes. Focus in the APAC session was on South Korea, where it announced a new KRW 1,350tln AI and chip spending package. The total plan includes promoting a semiconductor fab worth KRW 800tln, 81tln in a packaging hub and 550tln to build AI data centres. Samsung Electronics and SK Hynix are to be heavily involved, with the two Cos planning to build two chipmaking plants each for KRW 800tln. Even though the announcement helped reverse the earlier losses (Samsung Electronics -4.8%, SK Hynix -1.7%), analysts at Morningstar think that, if the new commitments are standalone investments, they could imply material oversupply risk over the next decade.

Top European News

• Spanish Economy Ministry said the Government expects the economy to grow by 2.6% in 2026 (prev. 2.2%).

FX

• Snapshot: G10s are mixed against the USD and to varying degrees. The Kiwi slightly outperforms vs peers, whilst the GBP and EUR follow closely behind. The JPY resides at the bottom of the list. Outside of the G10 space, the KRW is weaker this morning after South Korea unveiled a USD 1tln chip/AI investment plan. Potentially on fears surrounding a) how Korea aims to finance the government's portion of the investment, b) pressure in SK Hynix/Samsung shares, which leads to outflows in domestic markets, c) heightened geopolitical risk, and the associated inflationary impacts on the region.
• DXY is incrementally weaker against the USD, and currently holds within a 101.15 to 101.39 range. Focus for the index over the weekend was on the increased geopolitical risk, which ultimately highlighted the uncertain nature of the current US-Iran MoU. As a reminder, the US and Iran conducted tit-for-tat strikes; thereafter, the pair agreed to halt strikes and resume meetings this week. It seems to be the case that markets are happy to ignore the short-term flare-ups, and broadly focus on whether there are any material disruptions to the Strait of Hormuz.
• GBP is slightly firmer, holding within a narrow 1.3191 to 1.32282 range. Really not much driving the action this morning for the GBP, but focus ahead will be on commentary from likely PM Burnham. He is expected to announce plans to devolve powers and money from the central government to England’s regions. This would mark his first major policy speech since announcing his intention to stand for leadership of the ruling Labour Party.
• That aside, speculation around the next UK Chancellor continues. The Sun reports that current Work and Pension Secretary McFadden is a contender, under the belief he would steady the market. However, Miliband remains a contender, with a source to the Sun remarking that it is now between McFadden and Miliband. The latter remains the worst option for markets.
• JPY remains the slight underperformer this morning. USD/JPY currently holds towards near-term highs at 161.95, and within a 161.72-161.88 range. Speculation surrounding intervention remains heightened, particularly heading into US Independence Day. Japan favours intervention during periods of low volume, given the improved effectiveness when attempting to strengthen the JPY.

Fixed Income

• Fixed income benchmarks initially started the week on the backfoot as energy prices opened higher on renewed US-Iran strikes over the weekend, but have since come off lows as crude benchmarks fall from highs. This came after the US and Iran agreed to halt strikes, and meet on Tuesday.
• Gilts (-23 ticks) are slightly softer, ahead of MP Burnham's speech at 11:30BST/06:30EDT. It is to last around 20 minutes, focusing on his economic plans. We do not anticipate a Q&A. He is also expected to focus on expanding the devolution of control away from London, and could also touch on nuances around tax levels, housing stock, defence spending and within that, possibly war bonds. Welfare reform will also feature as part of the move to give local authorities more control. The UK benchmark currently trades in the lower part of a 89.24-89.58 range.
• Bunds (-8 ticks), likewise, are rangebound (127.35-127.51), despite a hotter-than-expected inflation print from Spain. HICP Y/Y printed at 3.6% vs exp. 3.4%, well above the ECB's 2% target, while the core figure ticked lower to 2.9% from 3.0%. If the trend of lower core figures follows through to other EZ economies, with France, Italy and Germany set to release their inflation figures later this week, this could signal that the ECB would be willing to look through higher headline figures. The lower core figures would also support the view put forward by ECB President Lagarde, in which she said, "We see no evidence yet of de-anchoring of inflation expectations or second-round effects that would warrant a more forceful policy response at this stage."
• USTs (-2+ ticks) follow their European counterparts, lacking any clear direction, with an appearance by Fed Chair Warsh at Sintra on Wednesday and the US jobs report on Thursday going to be the key driver for Treasuries. Warsh is likely to maintain a slightly hawkish tone and give little in terms of guidance. Ahead of the jobs report, economists at Capital Economics said further downside in yields could lose momentum, with the June report due to be strong again. The economist states that the increasingly strong labour market is not a reason to delay tightening, which could be the biggest near-term risk to USTs.

Commodities

• A choppy morning for crude as we digest the initial escalation and then the easing of tensions between the US and Iran over the weekend, with the near-term focus now on Tuesday’s technical talks in Doha.
• Just after the open, WTI and Brent hit highs of USD 70.97/bbl and USD 73.39/bbl respectively. While firmer by over USD 1.50/bbl on the day at the peak, the move failed to test Friday’s respective USD 71.86/bbl and USD 75.13/bbl tops, and by extension numerous levels thereafter.
• Benchmarks pulled back in acknowledgement of the initial Axios scoop that the side would be meeting this week, and, ahead of that, have agreed to stop strikes. Nonetheless, there still appears to be conflict occurring in Gaza and Lebanon. As the European morning proceeded, WTI and Brent have clambered off lows and trades firmer by USD 0.92/bbl and USD 0.66/bbl respectively.
• Spot gold picked up at the end of last week, reacting to the initial US strikes in the Hormuz area. The yellow metal ended the week at USD 4091, just off Friday’s USD 4096/oz best, though markedly shy of that week’s USD 4198/oz peak. For today, as above, geopolitical tensions have moderated somewhat and as such, XAU has lost some of its haven allure, slipping into the red by around USD 30/oz, with the US equity tone also bid and tech-led after the huge Korean AI and Chip spending plan, alongside confirmation that SPCX is to join the Nasdaq.
• Base metals are mixed, despite the firmer US tone. Instead, reflecting the mixed APAC handover and acknowledging the marginal deterioration in the European tone across the morning. 3M LME Copper is just about in the green, but in a thin and familiar range, shy of the mid-May peak.
• TotalEnergies (TTE FP) said operations at its oil refinery and petrochemical plant in northwest France were impacted by a power outage on Friday.
• Spain’s Bilbao Port Executive President urged the EU to delay the 2027 ban on Russian LNG or risk becoming overdependent on the US, according to FT.
• Oman LNG's first LNG carrier has reportedly departed the nation, Oman News Agency reported.
• US Agriculture Secretary Rollins said the US and Mexico opened a sterile fly production facility in Metapa, Mexico, which is expected to produce up to 100mln sterile flies a week.

Trade/Tariffs

• China's MOFCOM said 20 Japanese firms were added to the export control list for links to Japan's military. MOFCOM stated that measures only target some Japanese entities and apply only to dual-use items, while they do not affect normal economic and trade exchanges between China and Japan.

Central Banks

• Fed Chair Warsh is reportedly set to announce task force details in the coming few weeks, NYT reported citing sources,
• Fed's Barkin (2027 voter) said inflation is too high, but he sees some signs that price pressures could moderate soon, according to Bloomberg.
• ECB's Kazaks said there is currently no need for multiple ECB hikes in a rushed way, according to Econostream. Probabilities of the negative scenarios have fallen massively, with the shock and persistence being smaller while a smaller shock reduces the risk of non-linearities and second-round effects.
• BoE's chief economist Pill said the BoE is still experimenting with scenarios and external presentations.

Geopolitics

• Ukrainian President Zelensky said Ukraine targeted the Slavyansk-na-Kubani oil refinery in the Krasnodar region and a refinery in the Yaroslavl region of Russia, as part of Kyiv’s “long-range sanctions” campaign against Russia.
• Ukraine's air force said a UAV was detected in the Dnipropetrovsk region, while explosions were reported in the suburbs of Kharkiv.
• Russian President Putin said Russia has proposed that both sides stop striking each other’s deep targets and warned that if such strikes continue, Russian strikes on Ukraine will become more powerful with more severe consequences.
• Russian President Putin said Russia is expecting US negotiators once the US is less busy with Iran, while he also stated that Russia is ready for talks with the US, according to AFP.

US Event Calendar

• 10:30 am: June Dallas Fed Manf. Activity, est. 1, prior 0.4

DB's Jim Reid concludes the overnight wrap

We have published our quarterly global markets survey, which includes a range of fascinating insights—from expectations around events in Iran and where bubbles may be forming in financial markets, to how AI is being used at work and views on its potential to replace jobs. It also covers our regular questions and, perhaps most importantly, predictions for the World Cup. You 

Tensions in the Iran conflict have continued to escalate since Friday, with a series of tit-for-tat strikes around the Strait of Hormuz despite a fragile ceasefire framework. The latest flare-up began with attacks on commercial shipping, prompting successive US strikes on Iranian-linked targets, while Iran responded with missile and drone attacks on US-linked sites in the Gulf, including bases in Bahrain and Kuwait. Over the weekend, the conflict intensified further with additional strikes on vessels and military targets, leading to heightened maritime security risks and the Joint Maritime Information Center raising the threat level in the Strait to “substantial.” However, overnight developments suggest a tentative de-escalation, with the US and Iran reportedly agreeing to halt further attacks ahead of renewed technical talks in Doha this week. Both sides are said to be standing down for now, allowing shipping flows to continue, although disputes over key provisions of the memorandum of understanding—particularly around control and potential costs for transit through Hormuz—mean the situation remains fragile and risks to regional stability persist. Brent is up +0.71% this morning.

Asian equity markets are mixed this morning. Easing geopolitical tensions in the Middle East are providing some support, though fresh regional trade frictions are weighing on sentiment after China imposed tighter export controls on 20 Japanese entities, requiring government approval for shipments. Beijing said the move reflects concerns over Japan’s military posture. The KOSPI (-2.24%) is the weakest performer, with technology stocks still under pressure following last week’s semiconductor volatility, while the Nikkei (-0.88%) is also lower. In contrast, the Hang Seng (+2.12%) is outperforming, with the CSI (+0.08%) and Shanghai Composite (+0.15%) posting modest gains, and the S&P/ASX 200 (+0.35%) edging higher. US equity futures are firmer, with both S&P 500 and Nasdaq futures up +0.57%, while 10yr UST yields are +1.2bps at 4.38%.

On the policy front, the PBOC has introduced an overnight reverse repo facility, setting the rate at 1.25%. This marks another step in modernising its monetary policy framework and improving short-term liquidity management. The new rate sits 15bps below the existing seven-day reverse repo rate of 1.40%, which remains the main policy benchmark.

In Japan, early data showed retail sales rose 5.3% YoY in May, well above expectations of 3.0% and up from April’s downwardly revised 2.8%.

Global attention this week will centre on the US labour market, with the June employment report due on Thursday ahead of the Independence Day holiday. A reminder that the US will be 250 years old this week and Peter and Henry have written a piece explaining how it's continually prospered over the period and the likelihood of it doing so going forward. 

Alongside that, central bank communication will be in focus at the ECB’s Sintra forum (today through Wednesday), while inflation data across Europe and activity indicators in Asia—notably China’s PMIs and Japan’s monthly data—round out a busy global calendar.

In the US, our economists expect payroll growth on Thursday to slow to +75k (from +172k previously), with private payrolls rising by around +90k. There is some risk of seasonals pulling down the numbers as they have in recent years around this time. The unemployment rate is expected to hold at 4.3%, while average hourly earnings are seen unchanged at +0.3% month-on-month. Hours worked are also expected to remain steady at 34.3, leaving nominal income growth broadly stable.

Ahead of that, today brings the Dallas Fed manufacturing survey, while tomorrow sees the May JOLTS report, where markets will watch for any shifts in hiring, quits and layoffs amid a still subdued hiring environment. Wednesday then features the ADP employment report (our economists expect +110k) alongside the ISM manufacturing index (forecast 53.8 vs 54.0 previously). These releases should help set expectations going into Thursday’s payrolls. Beyond the labour market, tomorrow also sees the Conference Board’s consumer confidence index (our economists expect 94.1 vs 93.1 previously).

On policy, attention will turn to Wednesday, when Fed Chair Warsh speaks at the ECB’s Sintra forum. Our economists continue to expect a relatively hawkish policy path, with two rate hikes pencilled in later this year. However, near-term guidance is likely to remain limited, leaving markets to take their cues primarily from incoming data.

Looking beyond the US, Europe’s main event is the aforementioned ECB’s annual Sintra conference, which begins today and runs through Wednesday, featuring remarks from major central bank leaders. In parallel, inflation data will be a key focus, with Spain and Belgium reporting today, followed by Germany, France and Italy tomorrow, and the Eurozone aggregate on Wednesday. Our economists expect inflation of 2.46% YoY in Germany, 2.30% in France, 3.23% in Italy, and 2.95% for the Eurozone. Switzerland will also release CPI on Thursday. In the UK, the BoE publishes its credit conditions surveys on Thursday and the DMP survey on Friday.

In Asia, China releases various PMIs in the first half of the week. In Japan, today’s retail sales (out earlier) is followed by industrial production tomorrow, where our economists expect a +1.4% month-on-month increase. The highlight, however, will be the Bank of Japan’s Tankan survey on Wednesday, which is expected to show broadly steady sentiment and may reinforce the case for further gradual policy tightening.
Recapping last week now, and markets were rocked by a global tech sell-off, even as oil prices declined amid increasing traffic through the Strait of Hormuz. So both the S&P 500 (-1.95%, -0.05% on Friday) and the Nasdaq (-4.60%, -0.24% Friday) declined, whilst the Magnificent 7 (-5.46%, +1.47%) entered correction territory, down -12.6% from its May 28 peak. A large part of the tech weakness was driven by chipmakers, as the Philly Semiconductor Index dropped by -7.94% (-5.29% Friday), despite a brief reprieve midweek after Micron beat revenue estimates for Q4. In Asia, the Kospi (-5.81%, -7.08% on Friday) and Nikkei (-2.65%, -4.15%) also slumped.

The equity sell-off came despite Brent crude prices (-10.65%, -4.34% on Friday) falling back to below their pre-war levels at $71.99/bbl, as flows through the Strait of Hormuz continued to ramp up. The oil price decline has eased fears about an inflation shock and aggressive rate hikes. That was also helped by some positive US data last week, including Thursday’s PCE inflation which showed headline PCE up only +0.4% on the month (vs. +0.5% expected).

So investors dialled back expectations of Fed rate hikes, with the amount of hikes priced by December down -7.3bps to 32bps over the week. In turn, that led the 2yr Treasury yield -8.7bps lower over the week (-3.1bps on Friday), whilst the 10yr yield (-8.4bps, -2.3bps on Friday) fell to 4.37%. Pricing of ECB rate hikes by December also fell -12.8bps over the week to 24bps. Germany’s 2yr (-12.9bps, -1.1bps on Friday) and 10yr (-13.4bps, -0.6bps on Friday) declined in response.

Finally, in Europe UK assets outperformed as Prime Minister Starmer’s resignation announcement on Monday helped ease political uncertainty with Andy Burnham so far unchallenged as Starmer’s successor. Yields on 10yr gilts (-11.1bps, +3.2bps Friday) fell, while the FTSE 100 rose +1.40% (-0.21% on Friday). That helped keep the STOXX 600 stable over the week (+0.04%, -0.68% Friday), even as the DAX (-1.26%, -1.29% Friday) and CAC 40 (-0.55%, -0.43% Friday) fell after Friday’s slump.

Submitted by QTR's Fringe Finance

Last week, CNBC’s Andrew Ross Sorkin and Joe Kernen interviewed legendary value investor Jeremy Grantham, and for about six minutes the conversation turned into one of the better moments I’ve seen on financial television in a long time.

Grantham, the 86-year-old co-founder of GMO, whose case for the market being overvalued I highlighted last week, built one of the world’s most respected institutional asset management firms. Over the course of his career, he became famous for identifying some of the largest financial bubbles in modern history, including the Japanese asset bubble of the late 1980s, the dot com boom, and the housing bubble that culminated in the 2008 financial crisis.

During the interview, Grantham reiterated his long-held skepticism of Bitcoin, calling it “a useless speculative” asset that will eventually “dwindle away... not with a bang, but a whimper.”

Kernen wasn’t having it. He fired back that anyone who had listened to Grantham over the last decade had missed one of the greatest-performing assets in history, later broadening the criticism to Grantham’s generally bearish market outlook over the last fifteen years. The clip immediately spread across social media, where half the internet accused Kernen of bullying one of Wall Street’s most respected investors, while the other half applauded him for holding a famous skeptic accountable.

After watching it a couple of times, I think both sides were right.

Let’s start with Kernen. If you come on CNBC and tell viewers Bitcoin is eventually going to zero, it’s sadly probably only one of the times on the network you should expect to get challenged. It’s the opposite of the consensus view on a network that does nothing but offer pie-in-the-sky forecasts for crypto and usher in crypto-friendly guests all day. For specific examples, see this compilation of Tom Lee price targets.

I wish more financial interviews included challenging the guest. I wrote about this last week at length. The only problem is the real challenges…the dickish sounding ones like Kernen’s, only seem to be lobbed at skeptics or bears. As I’ve said, financial media desperately needs accountability. If you’ve been bullish for fifteen years, defend it. If you’ve been bearish for fifteen years, defend it. If you’re a CEO who has repeatedly missed guidance or has been accused of serious misdeeds, defend it.

If you’re a Wall Street strategist who has spent years chasing momentum and changing price targets after the fact, defend it. Nobody should get a free pass.

Kernen’s argument on Bitcoin was straightforward. I mean, I think arguing “past performance is indicative of future results” is a bit of a fool’s errand, but at least Kernen made his points clear: namely, you’ve been wrong so far.

Regardless of whether you think Bitcoin has intrinsic value, it has created extraordinary wealth for many.

It has gone from essentially nothing to becoming an institutional asset held through ETFs, corporate treasuries, family offices and investment funds. Millions of people who ignored critics like Grantham became substantially wealthier for doing so. That’s a perfectly fair point.

Kernen then expanded the discussion beyond Bitcoin and questioned Grantham’s broader market record, arguing that investors who had followed his cautious stance since roughly 2010 would have dramatically underperformed one of the strongest bull markets in history. Kernen even asked whether Grantham had ever become bullish during that period, suggesting he’d spent most of the last decade warning about valuations while the S&P 500 kept marching higher.

Again, that’s a legitimate question. Grantham’s response is where I think the discussion became much more interesting. He pushed back on the idea that he’d simply been a permanent bear, noting that he’d written extensively about the possibility of a speculative “melt-up” late in the cycle. In other words, he wasn’t arguing markets couldn’t continue rising. He was arguing they were becoming increasingly overvalued even as they did. Those are two different statements.

Saying an asset is overpriced isn’t the same thing as saying it has to collapse tomorrow. That’s a distinction people constantly miss. I’ve dealt with the same thing myself. And it’s why I’m constantly trying to determine whether being overvalued in the age of quantitative easing means anything anymore.

I’ve been called a “permabear,” even though anyone who actually reads this blog knows I’m constantly looking for opportunities. My annual list of stocks to watch is almost all long-only. I write tons of long-only ideas here. In fact, my 26 Stocks to Watch for 2026, measured on an average, equal-weighted basis, is now estimated to be up +26.1% year-to-date, beating the S&P 500 by roughly +18.7% so far in 2026. Last year, my 25 Stocks To Watch For 2025 torched the S&P by more than +50%.

What’s permanently bearish about getting long winners that outperform the index? Just because I’m not guzzling down the batshit insane valuations, backwards logic and nefarious loopholes that have been fueling most of this market rise higher? Because I point out risks in crypto and equities that nobody else appears to be talking about?

In March of 2020, when the entire world was panicking about the Covid crash that I had warned about months prior, I appeared on the SNN Network to talk about why I liked financial stocks and airlines. What’s permanently bearish about being a sole voice saying Covid was not a systemic financial problem and looking at Goldman Sachs at $150 when its now at $1,000?

The point applies to Grantham: Being skeptical of broad market valuations doesn’t mean you’re incapable of making money. As best I can tell, over the last two decades, Grantham’s investing approach has modestly underperformed simply buying and holding the S&P 500, but it hasn’t been the catastrophic miss that many of his critics suggest.

His firm’s flagship allocation strategy has delivered respectable long-term returns while deliberately sacrificing some upside during one of the strongest U.S. equity bull markets in history. Grantham would also argue that judging his record solely by annualized returns misses the point. Part of his philosophy appears to be centered on avoiding permanent capital impairment and the psychological toll of major drawdowns.

Investors who lived through the dot-com crash or the financial crisis know that recovering from a 50% loss isn’t just a math problem, it’s years of waiting simply to get back to even. Grantham’s case has never been that he’ll win every bull market, but that preserving capital during the inevitable busts leaves investors in a stronger position when the cycle eventually turns.

But I see Kernen’s point, too. As I’ve written countless times, our responsibility isn’t to sit around predicting the precise date the system falls apart. Our responsibility is to understand the system we’re investing in.

That brings me back to what I think was the most important exchange of the interview. Grantham argued that Bitcoin “hasn’t outlived a general bull market.”

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I actually agree with him. Bitcoin has experienced violent corrections, but it has never lived through the kind of prolonged, grinding secular bear market that hasn’t been instantly rescued by the Fed. Most of its existence has coincided with an era defined by quantitative easing, extraordinary liquidity, massive fiscal deficits and repeated central bank intervention.

That’s not a criticism of Bitcoin. It’s simply an observation. We don’t know how it behaves if we enter a multi-year environment where liquidity isn’t constantly expanding and policymakers can’t, or won’t, ride to the rescue. Whether or not this will ever happen again is the multi-trillion dollar question of our era: whether traditional measures of valuation even matter anymore in a world dominated by quantitative easing, passive investing, options-driven flows and central bank intervention.

That’s the real debate. Grantham believes valuations still matter.

They may not matter next quarter or next year, but eventually they matter.

Kernen is essentially asking whether investors have spent fifteen years waiting for history to repeat while the rules of the game have fundamentally changed.

Neither question has been answered and frankly, nobody knows.

That’s why I think people are making too much out of this interview. It wasn’t a scandal. It was a genuine disagreement about one of the biggest questions in investing today: do historical valuation frameworks still work in a world reshaped by central banks and perpetual liquidity, or have markets permanently evolved into something different?

That’s a conversation worth having. The only criticism I’d make of Kernen is that he didn’t always need to make it so dickish and personal sounding. Comparing Grantham to a broken clock and repeatedly talking over him didn’t strengthen the argument. It distracted from it. A CNBC host being a dick to a market skeptic he didn’t agree with is, after all, one of the key reasons I started this blog.

But in general, financial television needs more debates like this, not fewer.

It just needs more of them directed at everyone, not just the bears and skeptics.

Challenge the Bitcoin bulls, too. Challenge the CEOs overseeing controversy. Challenge the strategists. Challenge the analysts who’ve been wrong for years. If accountability is the standard, apply it equally: No Accountability

Let’s see that same energy the next time a CEO comes on after missing guidance for the fourth straight quarter. Or the next strategist who has spent five years telling investors to buy every dip regardless of valuation. Or the next analyst who upgrades a stock after it’s already doubled and quietly disappears when it falls 70%.

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QTR’s Disclaimer: Please read my full legal disclaimer on my About page here. This post represents my opinions only. In addition, please understand I am an idiot and often get things wrong and lose money. I may own or transact in any names mentioned in this piece at any time without warning. Contributor posts and aggregated posts have been hand selected by me, have not been fact checked and are the opinions of their authors. They are either submitted to QTR by their author, reprinted under a Creative Commons license with my best effort to uphold what the license asks, or with the permission of the author.

This is not a recommendation to buy or sell any stocks or securities, just my opinions. I often lose money on positions I trade/invest in. I may add any name mentioned in this article and sell any name mentioned in this piece at any time, without further warning. None of this is a solicitation to buy or sell securities. I may or may not own names I write about and are watching. Sometimes I’m bullish without owning things, sometimes I’m bearish and do own things. Just assume my positions could be exactly the opposite of what you think they are just in case. If I’m long I could quickly be short and vice versa. I won’t update my positions.

As of May 20, 2026 I personally no longer actively trade (read my story here). My investing/saving is done by recurring contributions mostly to sector ETFs and a few select equities, trusted third parties who oversee my accounts, and advisors. Such advisors or funds, through individual equities, options, index funds, mutual funds, ETFs, or other securities, may have positions in, exposure to, or holdings of names mentioned herein that I know nothing about. Basically, via index funds, ETFs and individual equities it is possible I could own, have exposure to, or not own anything at any point. As of the same date, May 20, 2026, in an attempt to lead a healthier lifestyle, I’ve also excluded myself from fantasy sports, sports betting, online and in-person casinos and prediction markets.

And all positions can change immediately as soon as I publish this, with or without notice and at any point I can be long, short or neutral on any position. You are on your own. Do not make decisions based on my blog. I exist on the fringe. If you see numbers and calculations of any sort, assume they are wrong and double check them. I failed Algebra in 8th grade and topped off my high school math accolades by getting a D- in remedial Calculus my senior year, before becoming an English major in college so I could bullshit my way through things easier.

The publisher does not guarantee the accuracy or completeness of the information provided in this page. These are not the opinions of any of my employers, partners, or associates. I did my best to be honest about my disclosures but can’t guarantee I am right; I write these posts after a couple beers sometimes. I edit after my posts are published because I’m impatient and lazy, so if you see a typo, check back in a half hour. Also, I just straight up get shit wrong a lot. I mention it twice because it’s that important.

Any hope that the memory-chip shortage would ease this year was upended Monday morning, as South Korea's two memory giants, Samsung and SK Hynix, prepare a massive capacity expansion that will unfold over the next five years rather than provide near-term relief. That means the supply squeeze rippling through consumer electronics, from Apple MacBooks to Microsoft Xbox consoles, is likely to keep driving prices higher  for the foreseeable future.

The Korea Economic Daily reports that South Korea plans to steer at least 1,350 trillion won, or about $880 billion, of private investments into expanding semiconductor manufacturing and AI data centers.

Samsung and SK Hynix plan to build four chipmaking plants in the country's southwest at a combined cost of 800 trillion won, while companies including Naver will invest another 550 trillion won to develop 8.4 gigawatts of AI data-center capacity by 2029.

"We're entering an era where the page turns in the blink of an eye," President Lee Jae Myung said, adding the country must accelerate faster than rivals, calling speed "the only way to survive" in the AI era.

South Korea's industry ministry wrote in a statement that the move aims to double the country's memory chip production capacity within five years and to secure its lead in chip production amid competition from China and Taiwan.

The memory crunch worsened last week when Apple and Xbox were forced to raise prices on MacBooks and gaming consoles. Then, a weekend story reported that Apple plans to tap China for memory, given the shortage that will persist through this year and next as AI demand soaks up memory supply.

Samsung shares fell nearly 5% Monday, while SK Hynix declined 1.7%.

JPMorgan analyst Jay Kwon provided clients with a first take on news from South Korea, calling the country's AI investment push the start of the "Mega Investment Era" and a move to strengthen its lead in memory chips, data centers, and physical AI.

The plan centers on three growth pillars: semiconductors, AI robotics and physical AI, and AI data centers, Kwon noted.

Here's more color:

Entering the Mega Investment Era. The Korean government (Presidential office and multiple cabinet members) and major AI ecosystem C-level executives (incl. Samsung/SK group chairmen) attended a national briefing today and shared the long-term AI mega project vision.

The Ministry of Trade, Industry and Resources ("MOTIR") announced the "Three Mega Project Plans" establishing 1) semiconductors; 2) AI robotics and physical AI; and 3) AI datacenters as the three major growth pillars (link). The genesis of the investment stems from retaining the current AI leadership (especially in AI semiconductors) and leapfrogging as an AI export country through nurturing and developing various AI-derivative businesses including robotics and AI datacenters. Within the semiconductor business, MOTIR highlighted 3S (Speed + Stronghold + Spearhead) + 1F (Full Support) as growth strategies: 1) Speed: MOTIR expects memory capacity to double in the next five years and pull-forward the advanced Yongyin fab ramp timeline by 7-12 years (From 2045-2047 to 2033-2040); 2) Stronghold: W800T investment in the Southeast region (four fabs in total) and W81T HBM backend fab investment in the Chungcheong region; 3) Spearhead: W30T investment over the next 15 years in R&D and labor to support the pathway from R&D to full production; and lastly 4) Full Support from the government backed by MOTIR. Other investments include fostering Robotics as the next growth engine and W550T investment in AI DC split between two phases (1st phase: 8.4GW and 2nd phase: W10GW investment by 2035).

Samsung Group: W2,655T investment of which W2,100T in semiconductors. Samsung Group announced a W2,655T investment in Korea (link) and SEC announced a W2,450T investment throughout 2026-2040 (W2,100T investment in semiconductors) (link). Combining the two investment announcements, SEC is expected to invest: 1) W1,650T in Yong-in fab cluster and existing semiconductor fabs; 2) W400T in Gwangju potentially as a new manfuacturing hub; 3) W56T in HBM backend packaging line in Cheonan/Onyang; 4) W67T in next-gen display and micro display in Asan; and 5)

SK Group: W2,100T investment (W1,100T in memory and W1,000T in AI infrastructure). SK Group explained the role of the datacenter is transistioning from storage to token generation and emphasized AI factory as the next growth engine of the group (link). The SK Group announced to invest W1,000T in AI infrastructure equating to 15GW by 2035 split between two phases (1st phase of 5GW ramp split between a mix of 0.5GW/1GW projects and an additional 10GW ramp by 2035). SK Group also announced that it will invest W1,100T in memory split between W600T in Yongin (pulling forward the ramp time from 2045 to 2033), W100T in NAND in Cheongju, and W400T for the next semiconductor cluster, potentially in the Southeast region.

JPM view: W4,755T (or US$3.1T) includes more than a dozen of~400k WSPM fab investments on a scale which is 2x that of the current installed DRAM WSPM capacity, implying the pace of building 1mn additional DRAM capacity (from 1H16- 1H26) will be multiple times faster than in the past after the tipping point in late2020s. Within the US$3.1T long-term investment plan, we estimate 60-70% to be allocated to front-end wafer equipment spending, 20-30% for infrastructure and cleanroom construction, and the rest for back-end packaging facilities. We expect to hear more details on specific timelines for investment (fab and investment plan in multiple stages and timeline) in the upcoming result season and follow-up corporate events

Investment Details:

The planned spending underscores South Korea's preparation for physical AI, but also shows that any immediate relief for memory chips won't happen anytime soon.

After some persisting Sunday reports, including in The Wall Street Journal, said that last week's renewed tit-for-tat fighting between the US and Iran in the Strait of Hormuz had 'stalled' the next round of talks, President Trump stated on Truth Social Monday that a meeting on Iran would be held in Doha Tuesday. He stipulated that Iran has requested the talks.

"Iran has requested a meeting. It will take place tomorrow in Doha," Trump wrote on his social media platform in all caps. Axios reported late Sunday, citing a senior US official, that "We decided to stop all the kinetic activity" and make way for renewed talks.

NBC notes in the immediate aftermath of the statement, "There was no immediate reaction from Tehran. Hours earlier, a senior Iranian official denied any technical discussions were scheduled to take place."

"Technical teams working on the implementation of the initial agreement between the two sides are scheduled to meet in Doha in the coming days, a source with knowledge of the talks," the report continues.

Abbas Aslani from the Center for Middle East Strategic Studies has contextualized, "In the past few days the two sides have been flexing their muscles on this strategic issue – meaning the Strait of Hormuz, which is a leverage for Iran that can create a balance in the negotiations with the United States."

"This has been clouding the atmosphere of the talks. The Iranian senior negotiator said they are not expecting those technical talks to be held this week," he added.

As for how this may or may not impact vessel traffic through the Strait of Hormuz in the wake of the MoU deal signing, and start of Switzerland technical talks earlier this month, Bloomberg reports that "Commercial shipping continued to move through the Strait of Hormuz at a reduced level after recent attacks on two vessels. A handful of vessels made open transits over the weekend, according to tracking data."

Last Friday into the weekend saw the escalatory spiral go into overdrive, as red lines continue to be tested. By early Sunday morning, both Bahrain and Kuwait came under direct Iranian attacks. The strikes came just hours after the Pentagon proudly announced it had pounded multiple targets inside Iran  - a move Washington characterized as "retaliation" for Tehran's continued harassment of commercial shipping lanes.

A short time before Trump's latest Truth Social post proclaiming Doha talks set for Tuesday...

Iran denies reports of scheduled technical talks with US in Doha
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Iran’s Deputy Foreign Minister Kazem Gharibabadi stated on Monday that “no technical talks” with the US are scheduled this week in the Qatari capital Doha, refuting recent western media assertions. IRNA reports… pic.twitter.com/pvAY6tYjxS

— The Cradle (@TheCradleMedia) June 29, 2026

Tehran is now threatening a "complete halt" to all diplomatic negotiations, despite that Trump has been signaling that the gloves are completely off if things spill over into next year: "There may come a point when we are no longer able to be reasonable, and will be forced to militarily complete the job that we very successfully started," he had said Saturday.

But then Iranian Foreign Minister Abbas Araghchi said on Sunday, "Any interference in this matter and any attempt to adopt new or separate arrangements compared to what is underway by Iran will only lead to more complicated situations and delays in the reopening of the Strait of Hormuz, and will fuel tensions." But for now, at least the two sides have 'agreed' to halt strikes, it was widely reported Sunday evening.