TRUMP TRADE OPTIMISM

Following the assassination attempt on Donald Trump, world financial markets have reopened with a surge in support for the “Trump trade”, fueled by expectations of tax cuts and other policies under a potential second term. This optimism has led to a rise in Treasury bond yields and a strengthening of the dollar against other currencies. Additionally, Bitcoin has also experienced a significant increase in value, and as of 8:00 AM CST the crypto is trading above the $62,000 mark. Investors remain cautious due to ongoing political uncertainty, but some believe that sectors such as banking, healthcare, and oil could benefit from a Trump victory. Moreover, it is worth noting that the market may see heightened volatility in the coming months, partially driven by the aftermath of the assassination attempt. In fact, experts have stated that although they do not expect the stock market to be damaged permanently, there could be more sudden price changes in the short-term as the U.S. election approaches.

FAST ACCUMULATION

During the recent market downturn, Bitcoin whales have significantly increased their holdings at the fastest rate since April 2023. These large holders, commonly referred to as whales, have been accumulating Bitcoin following the volatility in the crypto market caused by the impending offloading of assets by Mt. Gox and the German government’s plan to sell a substantial amount of Bitcoin. Data from CryptoQuant and IntoTheBlock shows that Bitcoin whales are stacking up their holdings at a rapid pace, with much of the accumulation happening when Bitcoin prices dipped to $54,200 on July 5th. While smaller traders have been selling off their Bitcoin holdings during the dip, data from Santiment reveals a net increase in the number of wallets holding at least 10 Bitcoin. This trend suggests that despite short-term market fluctuations, there is a growing confidence among larger investors in Bitcoin’s long-term potential. Additionally, the recent activity of a dormant Bitcoin whale re-entering the market by transferring a significant amount of Bitcoin further adds to the dynamic landscape of cryptocurrency trading.

RECORD HIGHS

The prominent investment bank, Goldman Sachs, has stated that it experienced a significant increase in profits during the second quarter of the year, driven primarily by a surge in investment banking activities. The company’s net income of $3.04 billion, which surpassed analysts’ expectations, was accompanied by a 17% rise in total revenues to $12.73 billion from a year ago. This impressive performance under the leadership of CEO David Solomon marks a notable turnaround for the firm after facing challenges in the previous year. In addition, it is worth highlighting that despite dealing with a dealmaking slump and other setbacks, Goldman Sachs has seen its stock climb by 24% since the beginning of the year and has shown a remarkable 114% increase since Solomon took charge nearly six years ago. The positive results reflect a broader trend of improved performance in the investment banking sector, as seen by rises in fees and trading revenues, and although there was a slight decline in investment banking performance compared to the previous quarter, Goldman Sachs remains optimistic about its growth prospects and overall performance moving forward.

TOP PICK FOR AI

Morgan Stanley has boosted Apple’s stock by 2% by designating it as a top pick and raising its price target, in light of the company’s recent introduction of Apple Intelligence, an AI technology aimed at driving device sales. Currently compatible with only 8% of iPhone and iPad devices, Apple is expected to potentially sell nearly 500 million iPhones over the next two years. Industry analysts anticipate a global smartphone market recovery led by Apple and Samsung, with Apple’s innovative efforts contributing to its outperformance of the S&P 500 index this year. Moreover, it is important to remark that although Apple experienced a slight dip in market share, it sold 45.2 million smartphones worldwide in the last quarter, securing its position as the world’s most valuable company with a market value of $3.6 trillion and promising future growth prospects.

KEY EVENTS HAPPENING THIS WEEK

Monday: Empire State manufacturing survey for July, and speech from Fed Chairman Powell.

Tuesday: Business inventories report for May, U.S. retail sales and import price index reports for June, home builder confidence index report for July, and speech from Fed Gov. Adriana Kugler.

Wednesday: Housing starts, industrial production and capacity utilization reports for June, and Fed Beige Book.

Thursday: U.S. leading economic indicators report for June, Philadelphia Fed manufacturing survey for July, and initial jobless claims report for week ending on July.

Friday: Speeches fron New York Fed President Williams and Atlanta Fed President Raphael Bostic.