In the United States, yesterday's trading session took an unexpected turn. It seemed headed for a loss until Nvidia's share price surged in the last ten minutes, pushing the S&P 500 and Nasdaq 100 into positive territory. Nvidia's stock only gained 0.25% by the close, but it was enough to complement the performance of other tech giants, notably Amazon which jumped nearly 4%, becoming the 5th stock in Wall Street history to pass the $2,000 billion mark. Amazon's role in AI development, through its subsidiary AWS, continues to be pivotal. Meanwhile, the company is reportedly planning to launch a service to compete with China's Temu, a major online marketplace. Additionally, two traditional economy stocks shone: FedEx, up 15% on promising outlooks, and Whirlpool, which rose 17% amid rumors of a takeover bid by Robert Bosch. This year, the Nasdaq 100 is up 17.4%, while the Russell 2000 remains flat.
 
Technology remains dominant, despite Micron's post-close results yesterday, which saw an 8% drop in its stock. Micron's solid performance lacked the excitement surrounding AI, mentioned only 11 times in their presentation, compared to Nvidia's 50. Micron trades at 17 times next year's expected earnings, while Nvidia trades at 50 times.
 
Globally, the yen is under pressure, heightening expectations of Bank of Japan intervention. Yesterday's US statistics were uneventful, but today's data, especially durable goods orders, might attract more attention. The 3rd estimate of US GDP is unlikely to excite, given its outdated nature. However, Friday's May PCE inflation figure is eagerly awaited, with expectations of a 0.1% rise in the core index, potentially signaling a Fed rate cut.
 
In China, authorities are encouraging property purchases by reducing down payment requirements. This appears to be stabilizing prices but hasn't helped the stock market, with Hong Kong down over 2% following lower-than-expected industrial earnings and tech stock declines after Micron's results. The MSCI China is down 10% from its highs, indicating a technical correction. Additionally, rumors of a government-initiated pay cap are concerning the financial sector.

In the Asia-Pacific region, red dominated. Tokyo lost -0.9%, Seoul -0.4% and Sydney -0.7%. The Indian market is holding up at around equilibrium. European leading indicators are still slightly bearish.

Today's economic highlights

US durable goods orders, annualized GDP, new jobless claims, and wholesale inventories will be announced at 8:30 am with housing resales data coming out at 10:00 am. Full agenda here.

The dollar falls to 0.9343 EUR and 0.7908 GBP. The ounce of gold rises to 2317 USD. Oil is down slightly, with North Sea Brent at USD 84.98 a barrel and US light crude WTI at USD 81.23. The yield on 10-year US debt rises to 4.33%. Bitcoin is trading at 61,100 USD.

In corporate news:

  • Micron Technology falls 6.8% in pre-market trading, as the company announced it expects revenue for the current quarter to be $7.6 billion, with a margin of error of plus or minus $200 million, compared to analysts' forecast of $7.6 billion, according to lseg data. this forecast takes precedence over third-quarter revenue, which came in above expectations due to demand for ai-related chips. following micron, nvidia, arm holdings, qualcomm, and advanced micro devices are down 0.8% to 1.1%.
  • Amazon crossed the $2 trillion market capitalization mark for the first time in its history on wednesday, making it the fifth american company to reach this milestone. the online retail giant is buoyed by optimism around artificial intelligence and the prospect of interest rate cuts in the united states this year.
  • Levi Strauss & co plunges 15.7% in pre-market trading after reporting second-quarter revenue below analysts' expectations.
  • Boeing will resume deliveries of its 777 and 787 wide-body jets to china, reports a source familiar with the matter. these deliveries had been halted in recent weeks due to a review by the civil aviation administration of china (caac).
  • Jefferies financial reported quarterly earnings on wednesday that exceeded analysts' expectations, as the bank benefited from higher commission fees for its transaction advisory services, indicating a recovery in the sector.
  • International Paper plummets 14.7% in pre-market trading after brazilian pulp manufacturer suzano decided to end discussions to acquire the american group, with its latest offer having been rejected.
  • Verona Pharma rises 5.6% in pre-market trading as the fda, the u.s. health authority, approved ohtuvayre, the laboratory's inhalation treatment for chronic obstructive pulmonary disease (copd). 

Analyst recommendations:

  • 3M Company: Deutsche Bank maintains its hold recommendation with a price target raised from 102 to USD 110.
  • Cummin: Deutsche Bank maintains its hold recommendation with a price target reduced from USD 311 to USD 303.
  • Datadog: Mizuho Securities maintains its neutral recommendation with a price target raised from USD 130 to USD 135.
  • Dover: Deutsche Bank maintains its hold recommendation with a price target raised from 173 to USD 186.
  • Eaton: Deutsche Bank maintains its buy recommendation and slightly reduces the target price from 375 to USD 374.
  • General Mills: TD Cowen maintains its hold recommendation and reduces the target price from USD 70 to USD 65.
  • Honeywell International: Deutsche Bank maintains its hold recommendation with a price target raised from 224 to USD 236.
  • Hubbell Incorporated: Deutsche Bank maintains its hold recommendation and raises the target price from USD 418 to USD 434.
  • Ingersoll Rand: Deutsche Bank maintains its hold recommendation and raises the target price from USD 98 to USD 101.
  • Johnson Controls: Deutsche Bank maintains its hold recommendation with a price target raised from 70 to USD 79.
  • Lennox: Deutsche Bank maintains its buy recommendation and raises the target price from USD 564 to USD 605.
  • Nvent Electric: Deutsche Bank maintains its buy recommendation and raises the target price from USD 88 to USD 90.
  • Oshkosh: Deutsche Bank maintains its buy recommendation and reduces the target price from 158 to USD 155.
  • Paccar: Deutsche Bank maintains its buy recommendation and reduces the target price from USD 129 to USD 121.
  • Parker-Hannifin: Deutsche Bank maintains its buy recommendation and reduces the target price from 606 to USD 592.
  • Rockwell Automation: Deutsche Bank maintains its hold recommendation with a price target reduced from USD 312 to USD 293.
  • Stanley Black & Decker: Deutsche Bank maintains its hold recommendation and reduces the target price from 93 to USD 86.
  • Trane Technologies: Deutsche Bank maintains its hold recommendation with a price target raised from 328 to USD 330.
  • United Rentals: Deutsche Bank maintains its hold recommendation with a price target reduced from USD 725 to USD 720.
  • Vertiv Holdings: Deutsche Bank maintains its buy recommendation and raises the target price from USD 102 to USD 107.