Written by Anna Szymanski
July 6 (Reuters) –
What is important in the US and global markets today
By Anna Szymanski, Managing Editor, Reuters Open Interest
Markets started the week on a mixed note, with Asian stocks declining and Wall Street futures moving ahead of the bell on Monday ahead of the first wave of second-quarter earnings reports this week.
Investors returning from the US 4th of July holiday and 250th anniversary celebrations will be digesting the earnings and a softer-than-expected US jobs report last week, which prompted markets to back off inflation bets and helped lift global stocks for the week.
I’ll get into that and more below.
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Tech stocks and the health of the AI boom will remain top of mind for investors this week as trading returns to normal after the US holiday. Chip shares, which rallied in the first half of the year as the so-called Magnificent Seven lingered, were swept up in last week’s tech selloff and may face another test this week.
The benchmark KOSPI index fell 0.5% on Monday ahead of Samsung Electronics’ earnings on Tuesday. The South Korean tech giant is expected to post 18 times earnings on growing demand for AI memory, although large bonus payments could weigh on earnings.
Meanwhile, rival producer SK Hynix is preparing to launch its US listing on Monday in a bid to raise $28 billion, its shares to begin trading on Nasdaq on Friday. And in tech news, Elon Musk’s SpaceX will join the Nasdaq on Tuesday.
Earnings season will begin this week, and S&P 500 companies are expected to deliver strong growth of more than 24% in the second quarter. Among the first major companies to report stateside later in the week will be Delta Air Lines and PepsiCo, both of which could shed light on the health of the US consumer.
That will be especially important given last week’s market story: the nasty surprise of the June US jobs report. It showed nonfarm payrolls rose by just 57,000, well short of expectations for a 110,000 increase. The payroll figures for April and May were also revised down by 74,000.
The soft print led investors to scale back expectations for the Federal Reserve to tighten as soon as September and helped lift some US stocks on Thursday, although a tech selloff continued to weigh on the Nasdaq. Global stocks continued to post their best weekly performance in two months, with MSCI’s broad index of global shares rising nearly 2%.
