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Hawkish Warsh Hammers Barbarous Relic: Gold Crashes Back Below $4000 As Rate-Hike Odds Rise

Gold plunged back below $4,000 an ounce for the first time since November 2025 this morning, as a resurgent dollar and the prospect of higher interest rates bring bullion’s three-year bull market to a halt (now down 30% from its January highs).

The precious metal has posted double-digit gains for each of the last three years, more than doubling in price as central banks, money managers and retail investors all piled into the trade.

That rally ran out of steam in late January, shortly after the precious metal hit an all-time-high near $5,600 an ounce.

Chief among the factors that weighed on bullion’s performance was the outbreak of the US-Iran war.

Higher energy prices have fueled inflation and increased the likelihood of rate hikes, making bullion less attractive relative to yield-bearing assets like Treasuries.

Additionally, during the early period of the war, Gold reserves were used as a 'piggy bank' by Emerging Market nations to fund the huge increase in costs to procure energy (and manage currency runs).

Although oil prices are now falling as the US and Iran are negotiate a permanent peace deal, new Fed Chair Kevin Warsh surprised markets with a hawkish tone at his first rate-setting meeting last week, putting more downward pressure on the metal.

“The primary driver behind gold’s recent decline has been a significant repricing of interest-rate expectations,” Ewa Manthey, commodities strategist at ING Groep NV wrote in a note Wednesday.

Additionally, the debasement trade, a strategy favoring assets such as gold and Bitcoin over currencies vulnerable to inflationary, fiscal and monetary excess, has been losing momentum since President Trump nominated Kevin Warsh to lead the Fed.

Warsh's statement that price stability is his overriding priority and his reputation as an inflation hawk have introduced doubts about the direction he would take, causing some investors to hedge their bets and leading to a decline in the debasement trade.

“Anyone who thinks that he is some kind of a stooge that’s been put in there to cut interest rates regardless of inflation is going to really, really be disappointed with Kevin Warsh,” said Gavyn Davies, co-founder and chairman of Fulcrum Asset Management and a former chief economist at Goldman Sachs.

“He’s not that kind of chair.”

The debasement trade - broadly defined as a strategy favoring assets such as gold and Bitcoin over currencies vulnerable to inflationary, fiscal and monetary excess like the dollar - had been one of the defining market narratives of the past two years.

“If the Fed has got the hiking bias, it’s really hard to play the debasement card,” Meera Chandan, JPMorgan’s co-head of global foreign-exchange strategy, said in an interview.

In the US, surging government borrowing and inflation running above target for more than half a decade fueled concerns that the greenback’s purchasing power would erode.

“What people were worried about was the inflation target, the Fed’s credibility and its independence,” said Jonathan Owen, a portfolio manager at TwentyFour Asset Management.

“I think those concerns were largely put to rest.”

All of which has helped push the dollar up to its highest since May 2025 (around the Nov 2025 highs)

As Bloomberg's Jack Ryan and Yihui Xie report, several major banks have cut their gold forecasts in the last week.

Though revised targets imply prices will gain from current levels, Wall Street analysts are markedly less bullish than before.

Goldman Sachs axed $500 from a forecast that now sees bullion ending the year at $4,900 an ounce, while Deutsche Bank AG cut its fourth-quarter estimate by 17%.

It seems that Specs have thrown in the towel on the barbarous relic...

As the gold price has caught down to ETF holdings.

As Deutsche Bank wrote in a note, continued sales from gold-backed ETFs showed that the usual support for the metal is “notably absent,”

Meanwhile in China, the metal’s onshore discount to Comex prices in New York suggests imports will not be a support for the market, the bank’s analysts said.

But Goldman noted that gold ETF holdings that have undershot their federal funds rate-implied level

Still, one bright spot for bullion is the continued strength of central-bank demand.

“The one pillar which remains strong is central bank demand, and we expect this to be the case for some time to come,” Deutsche Bank wrote.

The monetary institutions added to their holdings at the fastest pace in more than a year in the first quarter, and survey data indicates they intend to buy more.
 

Tyler Durden Wed, 06/24/2026 - 13:40

Mediocre 5Y Auction Tails As Foreign Demand Slides

After yesterday's solid 2Y auction, today's 5Y auction was an uglier mirror image. 

The sale of $70BN in 5 year paper priced at a high yield of 4.200%, up from 4.182% in May and the highest since Jan 25. It tailed the When Issued 4.193% by 0.7bps, and was the 8th consecutive tail for the 5Y tenor.

The bid to cover was 2.351, better than the 2.340 in May and the highest since October. 

The internals, however, a disappointment: Indirects took down just 61.60%, a big drop from 74.85% in May and the lowest since January. And with Directs jumping to 25.51% from 12.34% in May - the highest since January - dealers were left with 12.9, the highest since March.

Overall, this was a rather disappointing auction, and one which pushed yields fractionally higher from the lows of the day, although considering the big slide in the 10Y from 4.49% this morning to just over 4.40% we doubt too many will lose sleep. 

Tyler Durden Wed, 06/24/2026 - 13:22

"Real Alien Shit!": Downed US Pilot Reported Seeing Iranian Drones Swarm in 'Jellyfish' Formation

Authored by Antiwar.com via Dave DeCamp

CNN has reported that the pilot of a US F-15 fighter jet that was shot down over Iran during the US-Israeli bombing campaign in April reported seeing a swarm of Iranian drones in a formation that resembled a jellyfish before he ejected from the aircraft.

Sources told the outlet that the pilot reported what he believed he saw to US intelligence officials, setting off a debate within US intelligence agencies about Iran's potential drone capabilities.

Iranian state media

Above: Photo of wreckage of US aircraft in Isfahan, Iran, that was released by Iranian media after the US said it rescued two airmen who were on the F-15 shot down over Iran.

The report noted that the pilot was concussed during the incident, and US intelligence officials disagreed on whether he could recount what he saw clearly.

Describing the pilot's account, one source said: “Multiple drones interconnected and moving as one with smaller drones below the bigger drones like legs. Real alien sh*t.”

If Iran is able to control multiple drones in a formation like what the pilot described, it would mean its drone capabilities are far more advanced than what the US assessed.

During the full-scale war, the Pentagon admitted to Congress that Iran’s drones were more difficult to deal with than expected and that US forces were struggling to intercept them.

The F-15 pilot who recounted the incident was one of the airmen rescued by US special forces in Iran. According to the US military’s account, the pilot quickly recovered while the weapons systems officer, who was also aboard the F-15, took much longer to find.

A U.S. pilot who was shot down reported seeing flying Iranian drones swarm in a “jellyfish” formation. Cultural anthropologist Dr. Peter Skafish joins @LelandVittert to discuss the validity of the report. pic.twitter.com/PIrjo5VwcX

— NewsNation (@NewsNation) June 24, 2026

The US lost multiple aircraft during the incident, including two C-130s and two MH-6 “Little Bird” helicopters. Iranian officials alleged that the operation may have been a failed attempt to seize Iran’s enriched uranium.

Tyler Durden Wed, 06/24/2026 - 13:00

Moscow Oil Refinery Faces Six-Month Shutdown After Relentless Ukrainian Drone Attacks

Moscow's largest oil refinery is expected to remain out of service for at least six months after suffering significant damage in a series of Ukrainian drone attacks this month, according to Reuters, citing sources familiar with the matter, after Zelensky earlier vowed to bring the war to Russian territory. Kiev and the West are flirty with massive Russian retaliation at this point, which is precisely what Putin has vowed.

The refinery is located on the southern outskirts of the Russian capital and a major fuel supplier to the whole region. It was struck at least twice before this month - as dramatic and intense eyewitness videos captured - forcing operations to halt. Meanwhile via Newsquawk: 

Russia has reportedly asked for 50k tonnes of gasoline from Kazakhstan to help ease domestic fuel shortages, according to sources.

Several attacks on Moscow refinery in a matter of days, via AFP

"Repairs will take at least six months," one source said, describing the extent of the damage at the Moscow Oil Refinery.

The Gazprom Neft operatd facility processed 11.6 million metric tons of crude oil in 2024 and produced roughly 2.9 million tons of gasoline and 3.2 million tons of diesel fuel, according to public data.

It comes at a sensitive moment Russia continues to grapple with fuel supply challenges. At the moment, the Crimean peninsula is witnessing unprecedented government restrictions on selling gas to civilians, as well as half the population suffering an electricity blackout due to major Ukrainian drones strikes on Kerch port, and in particular damage to the large thermal power plant there.

Also, Russian Deputy Prime Minister Alexander Novak said this week that Moscow is considering a ban on diesel exports to stabilize domestic markets amid emerging shortages.

Ukraine's Security Service (SBU) previously claimed responsibility for a June 16 strike that reportedly damaged the refinery's primary oil-processing unit, described by Ukrainian officials as the plant's "heart." That's when the facility first reportedly suspended operations following the attack.

Two days later, Ukraine launched another large-scale drone assault on Moscow. Russian authorities reported hundreds of drones targeting the capital, resulting in fires at multiple locations.

Since international crude oil prices surged following the war in the Middle East centered on Iran, Russia has boosted its oil revenues as not only prices have jumped - but Russian oil was made desirable in India again - thanks to American waivers for sales of Russia’s crude already loaded on tankers in connection to easing the global crisis due to the Iran war.

Some reports have suggested Russian 'friendly fire' initially hit the Moscow refinery, the result of errant local anti-air missiles:

Rather than back down in the face of Moscow's new threats of "massive group strikes" on Ukraine, it seems Ukrainian forces are flexing with yet more attack waves. 

The Kremlin has long believed that Ukraine can't accomplish such sophisticated long-distance strikes on its own, but that it has had significant targeting help from US and Western allied intelligence.

Tyler Durden Wed, 06/24/2026 - 12:40

Jesse Livermore: Old Lessons For Today's Markets

Authored by Michael Lebowitz via RealInvestmentAdvice.com,

In 1891, at 14 years old, with nothing but the clothes on his back, Jesse Livermore left his family and headed to Boston. He quickly found a job posting stock quotes at a Paine Webber brokerage office. Livermore spent his lunch hours trading in “bucket shops,” loosely regulated offices where ordinary people bet on stock prices without owning the underlying stock.

His lunchtime trading activities earned him a $1,000 profit in his first year, and by the time he was 30, he had already made and lost a considerable amount of money trading. In 1929, he hit the jackpot. It is estimated that he made over $100 million by shorting stocks during the market crash. Such an enormous gain against the backdrop of despair made him a Wall Street legend, but five years later, he filed for bankruptcy.

The prolific trading stories about Jesse Livermore and the fortunes he made and lost are well documented in two books. The first, Reminiscences of a Stock Operator (1923), authored by Edwin Lefèvre, is the better-known of the two. The second book, How to Trade in Stocks (1940), was written by Livermore himself. It conveys the many lessons of what four decades of speculation had taught him. Specifically, he presents 21 market rules. While his career was marked by the incredible volatility of his wealth, and some consider him a failure as he died broke, his market knowledge is invaluable. Accordingly, we share his 21 market rules. While the language he uses is outdated, the rules remain prescient.  

Due to the length of the rules and our summaries of each, we are breaking this topic into two articles. Part Two will include rules 10 through 21.

Old Yet Valuable Insight

Today’s markets and those in which Livermore operated are vastly different. The technological transformations since Livermore’s trading days are immense. Regulation is much better today than it was then. Market news, rumors, and narratives spread at the speed of light today compared to days or weeks when Livermore traded.

Jesse Livermore wouldn’t recognize today’s markets. However, Livermore understood that at the core of every market, the most important factor is human behavior. As such, Livermore’s rules remain just as valuable in 1940 as they are today because human behaviors largely remain the same.

The human side of every person is the greatest enemy of the average investor or speculator. –How to Trade in Stocks

Rule 1: Nothing new ever occurs in the business of speculating or investing in securities and commodities.

Market cycles repeat because human psychology repeats. The specific market triggers change, but the cycles of greed and fear continue. Today, for instance, it is AI valuations; fifteen years ago, it was housing, and the decade before that, it was internet stocks. Yet despite the differing triggers, the underlying pattern of euphoria that separates reality from fundamentals remains consistent.

Understanding this rule does not require predicting the future. It only requires an understanding of where we are in the cycle.

Rule 2: Money cannot consistently be made trading every day or every week during the year.

This rule runs directly counter to what the financial services industry sells. Brokerage platforms, financial media, and trading apps are built on the false premise that more trading activity yields better results. The data argues otherwise. Research consistently shows that retail investors who trade most frequently underperform those who trade least. Livermore says that genuine great opportunities, where the risk/reward is favorable, and the trend is confirmed, are rare.

Jesse Livermore believes that most market action is noise. Treating noise as a signal is one of the most reliable ways to lose money over time.

The desire for constant action irrespective of underlying conditions is responsible for many losses in Wall Street, even among the professionals, who feel that they must take home some money every day – Reminiscences of a Stock Operator

Rule 3: Don’t trust your own opinion and back your judgment until the action of the market itself confirms your opinion.

Your investment analysis, no matter how right you think you are, is not tradeable until the market agrees with it.

Some stocks are greatly undervalued and can remain so for years. Conversely, others keep rising long after fundamental analysis no longer makes sense. The market’s price action provides real-time information about the balance of supply and demand for the shares. Wait for your analysis and the price action to align before deploying meaningful capital.

Rule 4: Markets are never wrong — opinions often are.

This is perhaps one of Livermore’s most important rules, but hardest to enact. When an investment moves against you, our instinct is to make a case for why the market is wrong. The case you make may prove to be correct in the long run. But “the long run” can be a prolonged and expensive waiting period. As he alludes to in Rule 3, markets are the collective judgment of all participants. That does not make markets rational, but it does make them the most accurate real-time measure of where the money is positioned.

We recently wrote a short piece The Market Knows What You Don’t that puts Livermore’s thoughts into the current context. As we wrote:

Humility is an underrated investment discipline. The moment we believe our views outweigh the market’s, we have stopped managing risk and started taking it. The market does not care what we think. Investors need experience and hard lessons to appreciate the market’s voice, especially when it differs from their own opinions.

Rule 5: The real money made in speculating has been in commitments showing in profit right from the start.

A position that immediately moves against you is important information. Livermore observed that the trades that produced the largest returns almost always worked from the opening entry. To his point, if you enter a trade at a pivotal point, like a confirmed breakout, the market should validate your position by moving in your favor. A trade that requires patience before it begins to work is a trade that you may have misjudged. Early confirmation is not a guarantee of profits, but its absence can be an important warning.

Rule 6: As long as a stock is acting right and the market is right, do not be in a hurry to take profits.

We are psychologically wired to take profits quickly, locking in small gains out of fear they will disappear. Per Jesse Livermore, the largest returns come from a small number of positions that are held through extended moves. Selling a position simply because it has risen is a mistake unless something has changed in the underlying conditions or price action.

It’s also worth noting that most investors also tend to hold on to losing positions too long, hoping for a recovery. The habit of selling winners too early and holding onto losers is called the Disposition Effect. Shefrin and Statman, who coined the term in 1985, describe it as the inclination to “ride losers and sell winners.”

Losing money is the least of my troubles. A loss never bothers me after I take it. I forget it overnight. But being wrong — not taking the loss — that is what does damage to the pocketbook and to the soul. – Reminiscences of a Stock Operator

Rule 7:  One should never permit speculative ventures to run into investments.

Rule 7 is a follow-up on Rule 6. When a speculative position declines, the temptation is to reframe it as a long-term investment to avoid accepting the loss. The position was entered under a specific thesis with an expected time horizon. If the thesis has failed or the time horizon has passed without confirmation, the rationale for holding the position has changed. Renaming a failed speculation as a “long-term hold” does not change its economics. It only delays the recognition of a loss and ties up capital that could be deployed profitably. Know why you own what you own, and revisit that thesis regularly.

Rule 8: The money lost by speculation alone is small compared with the gigantic sums lost by so-called investors who have let their investments ride.

Rule 8 challenges the conventional wisdom that long-term buy-and-hold investing is inherently safer than active management. Livermore’s point is that passive inaction can produce catastrophic results when positions deteriorate, and nothing is done to mitigate the losses. Consider investors who held Cisco through its 80% decline from 2000 to 2002 and then waited over 20 years for it to return to its highs. Capital preservation is not a secondary consideration. It is the foundation on which everything else is built.

The graph below shows the decades during which many Cisco investors were trying to claw back from losses, even though they could have bought better performing stocks.

Rule 9: Never buy a stock because it has had a big decline from its previous high.

What matters is not where a stock was trading but whether the conditions that drove the decline have changed. Buying into a declining trend because a stock “looks cheap” relative to its former price is a costly mistake investors often make.

Summary Part One

We write articles like this as much for us as for our readers. Taking the time to compile Livermore’s rules and summarize them reminds us that we are human and prone to making investment mistakes. The rules Jesse Livermore presents, regardless of whether we agree with them or not, allow us to step back from our daily job of watching markets and managing investments and to ask ourselves some important questions that are often ignored.

Tyler Durden Wed, 06/24/2026 - 12:20

"The Epitome Of Ludicrousness"

By Michael Every of Rabobank

"All-You-Can-Eat Shrimp"

“My view is that the United States could take all the seafood Greenland could produce, and cut out the middleman, and keep it from China — and you could bring back all-you-can-eat shrimp at Red Lobster.” That’s a recent quote from a Trump official in The New Yorker arguing for the annexation of that territory. As the magazine notes, the plans are both “ludicrous” and “deadly serious.” Well, loosen your belts, folks, because there’s an all-you-eat buffet of such news.

Yesterday, South Korea’s KOSPI -- in an OECD economy with top chips, consumer goods, plastic surgery, and boy- and girl-bands-- slumped 9.99%. At time of writing it was up 3.6% after news of a share buy-back by a chaebol. In Taiwan, home to cutting-edge TSMC (and geopolitical tensions) Bloomberg notes a 26-year-old unemployed man invested $60,000 in tech stocks after being advised, “buy any stock and you will make money,” as teenagers are opening brokerage accounts and trading volumes are crashing websites. This is apparently ‘the way things are.’

The EU, and Germany, the Netherlands, and Greece just joined the US Pax Silica ‘no China’ AI tech supply chain initiative alongside Finland, Norway, Sweden, and the UK; Israel, Qatar, and the UAE; Argentina, Canada, Chile, Costa Rica, and Panama; and Australia, India, Japan (which has seen China choke its supply of rare earths), Kazakhstan, the Philippines, Singapore, South Korea, and Taiwan. That’s the deadly serious part. What’s ludicrous is thinking that under this Pax there will be normal trade with China, when decoupling is the design, and that inside it anybody but the US will dominate due to economies of scale and first-mover advantage. As the US Deputy Secretary of War argues in ‘The Digital Sovereignty Trap’ that while, “The UN wants every nation to build its own AI stack,” that is “the surest way to stay a generation behind.”

Meanwhile, ‘The copper crunch: inside the US-China battle for a critical global supply chain’, underlines that frothy Asian tech and geoeconomic alliances ultimately require that metal – and there isn’t enough for everyone. That this zero-sum equation is not front and center of current market discussions, rather than the electronic/’paper’ price of assets that simply assume supplies of this key metal into existence, is the epitome of ludicrousness and deadly seriousness. Then again, we went through the same process with oil, and markets think they won that battle.

Yet Iran and Oman say they will control Hormuz and charge for it; the US says they can’t. Tehran insists it won’t let IAEA inspectors in; the US says they will. There’s no agreement on what they’d do there – watch a down-blending of highly-enriched uranium to a safe 0.7% or be shown Potemkin villages? Iran’s president stated without missiles, the country would be “just like Gaza”; a former Israeli PM said he’d smuggled Starlink systems into Iran to support an uprising, but this had been curtailed by PM Netanyahu (as a Kurdish uprising and on-the-ground drone strikes vs. Basij militia were by somebody). Israeli is reportedly behind a cyber attack now hitting Iranian banks.

Lebanon’s president rejected Israeli occupation and foreign interference, meaning Iran and Hezbollah, as Israeli and Lebanese delegations met in the US. The Israelis call the emerging deal there a “train wreck.” It will be for someone. Relatedly, the Trump Gaza Board of Peace is to ‘recalibrate’ at a Cyprus resort after a rocky first six months.

In the background, it’s reported China plans to offer postwar aid for Iran, with an eye on its energy supply. Can you join the dots there?

In the US, the Senate passed a resolution directing Trump to end hostilities with Iran, which is performative given: (1) he has; and (2) Trump can veto it even if the Supreme Court doesn’t. Then again, the entire US-Iran MoU can be seen as performative and subject to a Trump veto.

The EU’s Von der Leyen plans to visit Armenia, firmly in the former-Soviet Russian orbit, to show support for the pro-EU government there; that’s as Germany announced it will scrap plans to build its biggest warship since WW2, showing again that ambitious defense spending plans are not producing impressive results for the battlefield or oceans. Indeed, commentators are noting that Ukraine is set to be the military leader within the EU, as its accession process begins, a major shift in relative power in a very short period of time.

Besides the volatility in tech, the 10-year anniversary of Brexit shows the City of London fearing “Trump’s America may win the race,” according to Politico. That’s as the BoE has diluted its new stablecoin rules with plans for a £40bn issuer limit but no longer restricting holdings by individuals and companies. In other words, the market will be open for business – but unlike in the US, no big player will be able to dominate it, keeping everything ‘niche’. Then again, few expect any currency other than the US dollar, and its big players --except perhaps the Chinese renminbi-- to be able to dominate emerging crypto architecture.

On that front, Bloomberg notes ‘China Crackdown Rattles the Rich in World’s Top Offshore Hub’, which doesn’t seem to support the case for an alternative FX infrastructure on the financial side at least (though trade commodity finance may be a different story). And in Europe, “an historic day” was declared as the European Parliament backed a digital Euro. What role that will play in the global crypto ecosystem --with its emerging, stacked layers of: defence to provide copper, etc.; to provide AI; to provide industry and defence; to get the power to back the digital asset-- remains to be seen but it’s going to be (another) major realpolitik struggle.  

In real politics, Trump is pushing the Senate to pass the SAVE America Act, to save Republicans, who don’t want to pass it; acting DNI head Pulte is rattling cages in D.C.; Marjorie Taylor Greene joined Tucker Carlson in officially ditching the GOP (to form a ‘space lasers’ party?); and Reuters frames it that New York Mayor Mamdani’s political endorsements are testing the Democrats' appetite for far-left candidates – and it seems Democratic Socialism sells well within the primary electorate in New York at least based on the results. That, and the White House is pushing back on speculation that Trump got early access to a new obesity drug for “compassionate use.” Like I said, it’s all-you-can eat right now in many areas that are simultaneously ludicrous and deadly serious.

In the UK, King of the North and PM-in-waiting Andy Burnham is being advised to borrow new billions for infrastructure; and he says he’ll boost the defense budget; and that he will stick to the fiscal rules. Is that all-you-can-tax-and-spend, or something new in political-economy? Markets will have to wait and see.

Now back to sensibly frivolous coverage of the KOPSI, whose recent 9.99% daily decline ironically occurred the day after former Fed Chair Alan “I never met a bubble that I didn’t like” (really, that was his view) Greenspan passed away at 100.

Tyler Durden Wed, 06/24/2026 - 11:45

"Democratizing AI": OpenAI, Broadcom Unveil New AI Chip As Sam Altman Pushes For Full Control Of Compute Stack

OpenAI and Broadcom unveiled Jalapeño, OpenAI's first custom AI accelerator, as Sam Altman's chatbot maker pushes to control more of its data center chip stack and drive greater efficiency to lower inference costs.

The new chip is described as an "Intelligence Processor" and was designed from scratch for large language model inference, the compute-intensive process of serving AI products such as ChatGPT, Codex, and the OpenAI API.

"While OpenAI is still measuring final performance, early testing shows that Jalapeño will deliver performance per watt substantially better than current state-of-the-art," OpenAI wrote in a press release.

Both companies moved from initial design to manufacturing tape-out in just nine months, supported by OpenAI's proprietary models and Broadcom's silicon expertise.

OpenAI said the chip's architecture is designed to reduce data movement and better balance compute, memory, and networking resources, allowing workloads to run closer to peak performance. The company said the new chips are already powering machine learning workloads in a lab.

"Democratizing AI means making advanced models available, dependable, and affordable enough for more people to use every day," OpenAI continued.

It is clear that OpenAI is forging ahead with new in-house chips to lower costs from expensive Nvidia GPUs while simultaneously expanding compute capacity.

Another key factor is control, as Altman wants greater command over OpenAI's chip stack ahead of its push into physical AI. Improved cost efficiency protects margins and could drive profitability down the road. Internal projections estimate the profitability window opens in 2029-30.

Meanwhile, OpenAI has already struck deals involving Amazon's Trainium chips, AMD hardware, and Cerebras systems as it diversifies beyond Nvidia.

Related:

• OpenAI 'Unsatisfied' With Some Nvidia Chips, Has Been Looking For Alternatives For Months: Report

Broadcom shares rose 1.5% after the news, while Nvidia shares remained flat.

How long until Altman finds a contract supplier to produce OpenAI-designed memory chips?

Tyler Durden Wed, 06/24/2026 - 11:30

Trump Admin Backs Big Reactors With $18BN Supply Chain Loans For Ten AP1000s

The Department of Energy's (DOE) Office of Energy Dominance Financing (EDF) issued a conditional commitment for $17.5 billion in American nuclear supply chain loans. The money targets long-lead time components to accelerate deployment of 10 large-scale Westinghouse AP1000 reactors across up to five projects. 

Each reactor is rated at ~1.1 GWe. The combined output would power nearly 10 million American households.

Westinghouse will partner up to develop five new reactor plants, with each project involving two AP1000 units. The financing will require $1 billion in upfront equity, $500 million from Westinghouse and $500 million from the partner, before DOE loan funds flow. Westinghouse has already signed letters of intent with seven potential partners who have identified sites. 

The loans finance bulk purchases of long-lead items such as reactor vessels, steam generators, and other complex components that can take years to manufacture at fixed prices. The goal is to cut deployment timelines by up to three years through supply chain efficiencies and economies of scale.

To be clear, this announcement has nothing to do with the SMR or microreactor sector. There is no funding here for NuScale, Rolls-Royce, Oklo, Terrestrial, or any of the smaller advanced designs still navigating licensing and demonstration hurdles. 

This is explicitly about restarting the heavy forging, fabrication, and component supply chain for the only large advanced reactor design with operating experience in the United States today. Think nuclear supply chain companies including BWXT, MIR, CW, and FLS.

This is the financing mechanism behind the broader government push we have covered for months. As we reported when the national emergency framing surfaced around government backing for 10 large new reactors, and again when Cameco surged on the $80 billion Department of Commerce deal with Brookfield, the focus has stayed on proven large reactor technology.

Energy Secretary Chris Wright framed it as essential to reviving the domestic industrial base needed for large commercial reactors under President Trump's Executive Order on Reinvigorating the Nuclear Industrial Base. The target remains 10 new large reactors under construction by 2030.

Bulk equipment orders should drive down per-unit costs and give suppliers the volume signals they have lacked for decades. Conditional status still requires technical, legal, environmental, and financial conditions to be met before definitive documents and funding.

Tyler Durden Wed, 06/24/2026 - 11:00

WTI Holds Losses As Cushing Hits 'Tank Bottoms', US Production At Record Highs

Oil prices are testing down to pre-war levels this morning as more tankers cross the Strait of Hormuz and signs of progress in US-Iran peace talks eased fears of an immediate supply crunch.

Vessels are transiting Hormuz with their satellite signals switched on, indicating growing confidence among shipowners about safe passage of the chokepoint, through which about a fifth of global oil supplies transited before the war. The International Maritime Organization also said it had received safety guarantees allowing hundreds of ships to exit the Persian Gulf.

Washington and Tehran have both flagged early progress in talks to end the war, although negotiations are likely to be protracted and claims from the two sides have diverged. In a sign of how much oil has been leaving Hormuz in recent weeks, the International Energy Agency estimates that the United Arab Emirates is exporting oil at nearly 85% of pre-war levels. 

API

• Crude -765k

• Cushing

• Gasoline -1.24mm

• Distillates +1.45mm

DOE

• Crude -6.088mm (-4.1mm exp)

• Cushing -1.077mm

• Gasoline -2.064mm

• Distillates -3.064mm

Crude stocks have now declined for 9 straight weeks (as have inventories at the crucial Cushing Hub)...

Cushing is now well and truly testing 'tank bottoms' with stocks at their lowest levels since 2014...

That is the lowest level for this time of year since 2004...

The SPR saw another dramatic drawdown (over 9mm barrels last week)...

US Crude production is back near record highs as rig counts keep rising...

WTI is holding near the lows of the day after the report...

Finally, a closely-watched oil market indicator flipped into a bearish structure on Wednesday for the first time since February, with Brent’s prompt time-spread trading in a shallow contango, with the nearest contract’s price below the next month’s. That structure typically signals expectations of oversupply.

There’s also been a collapse in prices for real-world barrels, with premiums for barrels from the North Sea to West Africa tumbling.

Tyler Durden Wed, 06/24/2026 - 10:45

Cerebras Plunges To Post-IPO Low On Striking Admission: The US Has A Dire Shortage Of Operating Data Centers

Just over two years ago, we first penned our views on "The Next AI Trade", which looked beyond the hyperscalers and the data centers supporting the AI revolution, and instead focused on the energy and logistical needs that would be so very critical in allowing the US to dominate China in the existential race to first reach Artificial General Intelligence (which many have dubbed the next nuclear arms race due to its profound civilizational implications). It was here that we defined the "Power Up America" basket as the next AI trade. 

Yet as one can see in the chart below, after outperforming the AI Data center and the TMT AI baskets in 2024 and much of 2025, the Power Up America trade has lagged and clearly underperformed, as some investors have started to express doubt that the US would ever be able to "grow" into its massive AI computing needs... with dire consequences for record AI capex budgets, something the market has yet to grasp.

And unfortunately, with every passing day, the outlook for the US AI revolution looks increasingly more dim. 

That's because, as Canaccord Genuity analyst George Gianarikas write two months ago, "the American data center boom is hitting a formidable wall of logistical friction." He is referring to the latest outlook by Sightline Climate, which is also reinforced by recent articles from Bloomberg and others, and reveals a sobering reality for 2026: nearly half of the nation's planned 16-gigawatt capacity faces cancellation or delay, with only 5 gigawatts currently under construction.

That's right: half.

This collapsing inertia stems from a volatile mix of local permitting hurdles, community resistance, and a desperate reliance on overextended global supply chains for critical components like transformers and helium.

Taking a step back, despite over $800BN of expected 2026 hyperscaler capex, a number which seems to jump by $50bn or see every quarter,  nearly half of the data centers scheduled to begin operations in the US in 2026 "will either face delays or outright cancellations." The data, which comes from Sightline Climate's 2026 Data Center Outlook,  suggests that just 30% - 50% of the ~16 GW of planned US capacity for the year will face risks, with only ~5 GW currently under construction!

And the horizon only grows darker in the coming years. By 2027, the gap between ambition and reality widens further, as a mere fraction of the announced 21.5 gigawatts has actually broken ground. Worse, according to Futurism, data centers slated to open in 2027 are progressing far more slowly than anticipated. "Only about 6.3 gigawatts worth of computing infrastructure are actually under construction, compared to 21.5 announced gigawatts."

And then visibility drops to virtually nothing beyond 2028 as uncertainty increases materially in the outer years. According to the article, "things get even dodgier in the coming years, with the vast majority of data centers planned for launch between 2028 and 2032 having yet to even break ground. There are a further 37 gigawatts of planned infrastructure which haven’t even received a firm completion date, only 4.5 [gigawatts] of which have actually begun work."

This trend suggests an increasingly uncertain future for the industry, where power constraints and grid instability cast long shadows over projects slated through 2032.

But while one can pretend the future is irrelevant, the same limitations are visible in the here and now: according to the SightLine report, "at least 16GW of data center capacity is slated to come online this year across 140 projects. 53% will be grid connected, 3% will be powered solely by on-site power, and 25% have not disclosed their powering strategies. We expect 30-50% of these projects to be delayed. Only 5GW is currently in construction."

And the punchline:

"We expect 30-50% of 2026 projects to be delayed, driven by power constraints (25% of projects have not disclosed powering strategies), increasingly effective community opposition, and potential grid equipment shortages. 11GW of 2026 capacity remains in the announced stage with no signs of construction, despite typical build times of 12 to 18 months. Itʼs still possible for this capacity to come online, but it would need to dramatically accelerate."

As noted above, the market had been stubbornly ignoring the physical limitations in the data center rollout... until last night, when recently IPOed chipmaker Cerebras reminded everyone of just how profound the data center limitations truly are. 

Cerebras shares plunged in early trading after the newly public chipmaker gave an annual sales forecast that disappointed investors who were expecting the company to carve out a bigger slice of the AI data center market.

Like other rivals of Nvidia, Cerebras is navigating high expectations from investors who’ve grown accustomed to the rapid revenue growth and profits tied to a worldwide buildout of AI data centers. Nvidia and a small group of chipmakers have regularly blown past Wall Street estimates, creating an environment in which even solid earnings results don’t necessarily translate into share-price gains.

And at first glance, Cerebras fell into that bucket: the company said that revenue in 2026 will be $855 million to $865 million, above the sellside analyst estimate of $824.8 million. First-quarter sales jumped 94% to $193.4 million, beating estimates of $181.4 million. The Sunnyvale, California-based company reported a net loss of $14 million in the period ended March 31, also beating the estimated loss of $58.6 million. Cerebras’ hardware business generated sales of $110.6 million. Cloud and other services reported $82.8 million.

The company reported earnings for the first time since raising $5.5 billion in May as part of the biggest initial public offering in chip industry history. Cerebras has carved a niche for itself in artificial intelligence infrastructure with novel technology built around a massive chip that it says is better at running large AI models and generating fast responses for users.

And yet despite the solid earnings, the stock was punished, tumbling 15% below $200 and the lowest price since it broke for trading at $311 in early May (but still above its IPO price of $185).

Why the disconnect? After all sales easily beat estimates and grew at an impressive rate.

The answer: margins. The chip designer warned that annual profit margins ‌would undershoot first-quarter figures. Cerebras forecast adjusted gross margins of 38% to 41% for 2026, compared with the 47% it reported ‌for the first quarter.

The ⁠projection is far below those of rivals such as Nvidia's mid-70% range and Advanced Micro Devices' mid-50%, even as it ⁠came above analysts' estimates of 29.58%. 

To be sure, analysts had flagged that gross margins could be pressured by the company manufacturing relatively larger-sized chips, and as it rents back ​its own ​systems from an existing client to ​meet short-term demand while it ‌builds out more data center capacity.

But according to the CEO, the biggest challenge right now is not the chip size, but - going back to what we said at the beginning - getting enough data center space. As CEO Andrew Feldman said , “It’s a grand irony that after all this technology that we’ve invented, and Nvidia’s invented, buildings are the limiting factor,” he said in an interview before the results were released.

The scarcity of data center space is leading Cerebras to rent back some of its own systems from a customer and “aggressively” build out its own capacity, CFO Bob Komin said on a conference call after the report. It is these costs that will hurt margins by about 10 to 15 points this year, he said.(Adds premarket share move starting in first paragraph).

Which begs the question: where the hell are all the massive orders of GPUs and memory going if there are no data centers to hold them? 

We don't know but, like Canaccord's George Gianarikas, we admit "we’re a little spooked."

In a note published earlier this month, the Canaccord strategist wrote that "At this moment, count us as hand-wringers. Panicans. Doomers. We have been writing a series of notes for ~2 years called "Something’s Got to Give" and "Glitch in the Matrix" where we voice our concerns about the speed at which the necessary energy infrastructure for AI is being constructed. Add in data center moratoria. And, financing concerns. Throw in a dash of loopy circularity. Not to mention, eery similarities to the telecom bust."

And yet, Gianarikas goes on, "the happenings of the past few months have been fascinating, historic, and head-scratching. In the face of all that glitching, hyperscalers continue to up the ante - deploying increasingly massive capital to expand data center capacity. While structural inflation and rising component costs are playing their part, the underlying catalyst is simpler (at least to us): an insatiable demand for "more cowbell", driving perhaps the most profound cycle of FOMO in human history."

To be sure, this spending is very much showing up in earnings results. Look no further than semis or power-related deal announcements (e.g., Generac and Fluence) or elements of the industrial supply chain or revenue growth at some of the hyperscalers.

Or look at US GDP. As we noted a month ago when we pointed out that AI now accounts for 75% of US GDP growth, "there is a troublingly disproportionate reliance on AI spending to anchor economic progress."

But - the Canaccord strategist asks - "what about the power? Can the power keep up with the build plans? We don’t think so. Channeling our inner Scotty from Star Trek: "I can't do it, Captain! I don't have the power!""

Even the Wall Street Journal has taken taking notice. In an article published last month, they said that “America’s Data Center Build-Out Is Falling Way Behind Schedule”. Yes. Yes, it is.

As Gianarikas concludes, "Though macro market mechanics sit outside our mandate, we cannot ignore the parabolic split between the AI-enablers and the AI-dislocated. It is a stark tale of haves and have-nots - and it leaves us with a haunting question: What happens if the lights don't turn on?"

We got one answer from Cerebras. But the bigger problem is what happens if there is simply not enough data center capacity to light all the unlit components? And what will the returns be on those hundreds of billions in debt spent to fund the AI rollout? We 

ROI is not the right metric for AI. The right metric is what is the ROI assuming all the planned data centers are built and energized for the IRR period.

SPVs have made funding a non-issue (for now). But if components remain unlit, they are a $1 TN inventory paperweight

— zerohedge (@zerohedge) June 5, 2026

Understandably, Canaccord is asking precisely that question: "where is the capital actually going? It has to be landing somewhere. The reality, we suspect, is that mountains of expensive compute hardware are currently operating as high-tech paperweights. While the industry boasts of sky-high capacity utilization, a closer look causes that narrative to fray - at least to us. "Lit" capacity may be humming, but how much remains in the dark?" 

The answer from Cerebras is clear: "a lot"... and as more AI companies admit the unpleasant truth, expect a reckoning as the market finally asks the trillion dollar question. 

Tyler Durden Wed, 06/24/2026 - 10:35

CBOE Debuts Prediction Market With S&P 500 Contracts

Authored by Zoltan Vardai via CoinTelegraph.com,

Market operator Cboe Global Markets has entered the prediction markets business with the launch of Cboe Predicts, a platform debuting with binary contracts tied to the S&P 500.

The contracts are now available through Interactive Brokers and are expected to launch at Charles Schwab and other retail brokerage platforms in the coming months, according to a Tuesday press release.

The contracts allow traders to take "yes" or "no" positions on whether the S&P 500 will close above or below a specified price level.

Cboe is the latest traditional finance firm to expand into prediction markets as investor interest in outcome-based contracts grows. The launch comes days after reports that Charles Schwab was seeking to enter the sector through a partnership with Cboe that would offer customers similar S&P 500-linked contracts.

Contracts tied to the S&P 500's daily closing price are already available on prediction market platforms such as Polymarket and Kalshi.

Cboe launches XSP Binary Options in prediction markets offering. Source: Cboe

Traders seek more binary event contracts

Cboe’s customers are showing more demand for shorter-dated, outcome-based trading opportunities, which led to the debut of the prediction market offering, according to JJ Kinahan, head of retail expansion and alternative investment products at Cboe. 

Cboe’s new contracts are security options that will trade within the same regulatory framework as US-listed options, providing “institutional-grade liquidity” and transparency, Cboe said.

Meanwhile, prediction market platforms have drawn increased regulatory scrutiny over political betting and sports-related event contracts.

Kentucky was the latest state to sue five prediction market platforms, including Kalshi and Polymarket, accusing them of “operating unlicensed and illegal sports betting and gambling platforms,” as Cointelegraph reported on Thursday.

In January, US lawmakers proposed legislation aimed at restricting political prediction market trading by government officials after a Polymarket user netted over $400,000 on a contract related to the removal of then-Venezuelan President Nicolás Maduro, fueling insider trading concerns.

Tyler Durden Wed, 06/24/2026 - 10:20

New Home Sales Unexpectedly Plunged In May As Prices Surged

With Case-Shiller reporting existing home price declines in half of America's largest cities, New Home Sales were expected to rebound from April's ugly decline.

But they didn't... at all...

NAR reports that New Home Sales in May plunged 7.3% MoM (versus the 3.2% MoM rise expected). That print was below the lowest analysts forecast.

April's 6.2% MoM plunge was revised up modestly to a 5.7% decline, all of which left new home sales down on a YoY basis...

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...

Finally, while existing home prices are lower, median new home price rose 2.0% MoM to $424,900, unchanged YoY...

Average and median new home prices continue to diverge as sales of ultra-expensive homes drag the average higher even as median price is dropping...

The biggest two-month jump in median new home prices in four years is more than offsetting any gains from lower mortgage rates. 

Tyler Durden Wed, 06/24/2026 - 10:10

'Customers Are Being Gouged': Trump Tells DOJ To Look Into Gasoline Prices

President Trump said on Wednesday that he had instructed the Department of Justice (DOJ) to open an investigation into oil companies over high gasoline prices.

In a Truth Social post, Trump said that oil companies have not lowered their prices at the pump despite a recent decline in crude prices following the U.S.–Iran preliminary agreement.

“Those prices are dropping like a rock! In other words, customers are being ‘gouged,’” he said.

“Gasoline prices better start going down a lot faster than what I’m seeing!”

Brent crude futures fell below $75 per barrel on Wednesday (back near pre-war levels), while U.S. West Texas Intermediate futures dropped to $72.29, amid the resumption of shipping traffic in the Strait of Hormuz.

Bloomberg's energy guru, Javier Blas, remarked after President Trump's post: 

"US President Trump, all political theatre, has just discovered the refining (and marketing) margin."

The national average price for regular gasoline stood at $3.93 per gallon on June 23, according to the American Automobile Association (AAA), down from $4.04 the previous week.

The gas price was $4.53 per gallon a month ago.

Of course, given the supply/refinery chain, it takes time (two weeks) for crude prices to ripple through to pump prices...

AAA said it observed that gas prices remain above the levels before the conflict with Iran erupted in February.

The national average price for regular gas was $2.98 on Feb. 28, the day when the United States and Israel launched military operations against Iran, triggering the war.

“Getting prices back down to prewar levels will take longer because of the time it takes to resume shipping and production,” Marie Dodds, public affairs director for AAA Oregon/Idaho, said in a statement.

As Aldgra Fredly reports for The Epoch Times, US and Iran signed a memorandum of understanding last week to end the war. Under the agreement, the Strait of Hormuz would be fully reopened, and Tehran would not procure or develop a nuclear weapon. The United States also agreed to waive sanctions on Iranian oil for 60 days.

U.S. Secretary of Energy Chris Wright told ABC News on June 21 that commercial shipping traffic through the Strait of Hormuz had returned to normal levels, and that Americans should expect further declines in oil, gasoline, and other energy prices as traffic resumed.

“Flows of oil and natural gas through the straits have already returned to normal, and they will continue that way whatever happens with the negotiations with the Iranians,” he said.

Arsenio Dominguez, secretary-general of the International Maritime Organization, said on June 23 that more than 11,000 seafarers stranded in the region due to war would be evacuated under a coordinated effort with Iran, Oman, other coastal states in the region, the United States, and the maritime industry following the U.S.–Iran preliminary deal.

“We have secured the necessary safety guarantees and have thoroughly verified the conditions for safe navigation to support these operations,” Dominguez said in a statement.

Iran had previously blocked traffic in the Strait of Hormuz—a critical waterway through which a significant share of global oil and gas shipments passes—in response to the U.S. and Israeli attacks on its nuclear and military sites.

Tyler Durden Wed, 06/24/2026 - 09:25

Uh-Oh, Silver!

Authored by Adam Sharp via DailyReckoning.com,

One year ago, silver was trading at around $36 per ounce.

Today the price is around $60. Normally, that’d be considered a win.

But over those 12 months, we silver bugs have been on a wild ride.

Simply incredible price action. From $36 to $119 in about 8 months. And now back down to $66.

I believe the silver bull market still has years to run. Maybe even another decade.

Today, let’s explore why.

+$16 Since 1980?

Silver first reached $50 way back in 1980.

Of course, silver’s miraculous 1971-1980 run wasn’t totally natural. The famous Hunt brothers had cornered a big chunk of the silver market, controlling roughly 9% of investable silver through physical ownership and futures contracts.

But silver would have done well during the 1970s even without the Hunt Brothers. That year inflation peaked at around 14.8%.

Investors sought refuge from stagflation in precious metals. And gold and silver were the star sector of the 1970s.

It’s wild that silver is still only $16 above the 1980 peak.

This Isn’t 1980

1980 represented a peak for gold and silver that would last decades.

Some precious metal investors may be concerned that we’re seeing a similar peak today.

But what caused the 1980 peak? Two factors dominated.

In 1971, Nixon ended the last remnants of the gold standard. The U.S. dollar was no longer bound by a fixed relationship to gold.

The 1970s gold and silver bull market was primarily driven by this massive shift to purely fiat money. It was a classic devaluation of hard money into fiat.

By 1980, the Petrodollar arrangement, in which oil producers agreed to only sell oil in dollars, had restored demand for U.S. dollars on the global stage.

Additionally, Fed Chairman Paul Volcker finally resolved to kill persistent inflation by hiking interest rates to nearly 20%. These sky-high rates finally tamed inflation.

By 1980, the U.S. had eliminated the inflationary threat, and set itself up for a period of strong growth.

In 1980, stocks were dirt cheap and poised to outperform precious metals for some time to come.

A Different World

Looking back at the 1970s can be helpful at times. It was one of the greatest hard asset bull markets in history.

But it was a different kind of crisis compared to the issues we face today.

For decades the world has been on an unprecedented debt binge. Governments, corporations, and individuals have all run up huge tabs.

The U.S. debt-to-GDP ratio today is over 125%. From 1970-1980, it never surpassed 40%.

Having so much debt limits the policy options of central banks like the Federal Reserve. You can’t exactly jack rates up much higher than they are today, or soon we’ll be spending a majority of tax revenue just paying the interest on our debt. Much of the world is in a similar situation.

So I continue to believe that eventually the Fed and Treasury Department will be forced to use extreme measures. Money printing and debt monetization on a scale never seen before.

That’s a primary reason I believe the precious metals bull isn’t over. Not even close.

Finding Its New Range

Silver has fallen significantly from its 2026 highs. But the long-term trend remains up.

Silver only broke through the historic $50/oz resistance wall late last year.

Breaking the $50 level, and staying above it, was a huge milestone. And silver continues to find its new range.

Silver demand remains strong, with 2026 deficits estimated to be significantly above the 2025 shortfall.

Silver being in “deficit” simply means that more is being consumed than produced. And as you can tell, we’ve been in a serious silver deficit since 2021.

Now, it’s important to note that earlier estimates had predicted a significantly smaller silver deficit in 2026. But strong demand for coins and bars, especially in Asia, made the difference.

Inventories at major exchanges like the COMEX have fallen below 100 million ounces, from a high of 300 million in 2020.

Industrial and investment demand for silver remain strong. I expect both to stay robust for years to come.

Silver production from mines remains essentially flat. Recycling is up, which is one of the reasons for this correction. Millions took advantage of the price spike to sell the family silver.

But the global debt bubble is still inflating. Massive amounts of money will need to be printed to patch holes in it.

So I’m holding. Silver is destined to hit $200 within the next few years. We’ve never had this much industrial demand, and savvy investors will buy the dip. I even expect that more global governments will begin stockpiling the metal, as both the U.S. and China have recognized silver as a critical strategic metal.

Silver remains an excellent way to hedge against inflation. It’s also a critical metal for bleeding-edge tech.

“Poor man’s gold” will remain highly volatile, but as long as you can stomach that, I say buy the dip. Cautious investors may want to consider spreading their buys out over time (dollar-cost averaging), in case we haven’t bottomed quite yet.

Tyler Durden Wed, 06/24/2026 - 09:10

Heavily Shorted Wendy's Soars After New CFO, Reddit Traders Pile In To Save Burger Chain

Heavily shorted Wendy's shares jumped as much as 22% in premarket trading on Wednesday, as a management shakeup and a surge of WallStreetBets activity around the struggling fast-food chain appeared to trigger a retail-driven squeeze.

The stock surge followed Wendy's appointment of former Potbelly CFO Steve Cirulis as CFO and chief strategy officer, as part of new CEO Robert Wright's turnaround effort for the fast-food chain, after shares had sunk 25% as of Tuesday's close.

Before joining Wendy's, Cirulis served as CFO and CSO for Potbelly Sandwich Works, departing from that role in December. He brings more than 30 years of experience across the retail and restaurant industries as the fast-food chain attempts to engineer a turnaround plan called "Project Fresh."

Outlet CFO Dive noted:

While at Potbelly — where he served overlapping tenures with Wendy's CEO Wright — he helped to lead a turnaround at the sandwich chain that boosted annual sales, CFO Dive sister publication Restaurant Dive reported at the time. Under Wright and Cirulis' leadership, Potbelly also saw a 500% jump in share price and improved its restaurant margin expansion and invested capital returns, Wendy's said Tuesday.

The Wright-Cirulis tag-team leadership shakeup at Wendy's appears to have sparked a retail-driven short squeeze, as short interest in the stock recently topped 31.8%, with about 4.7 days to cover.

This spark was likely fueled by Reddit-driven momentum piling into the beaten-down fast-food chain.

Activity on WallStreetBets:

Next GameStop? If so, risks mount whether the WEN CEO uses retail as a piggy bank through share sales. 

Tyler Durden Wed, 06/24/2026 - 08:55

Futures Rebound From "Chip-Wreck" Ahead Of Critical Micron Earnings

US stocks are set for a rebound with equity futures higher as Semis and Tech stage a partial recovery from yesterday’s "Chip-Wreck" as KOSPI retraced about 20% of its losses ahead of earnings from the single-biggest contributor to US outperformance this year: Micron’s third-quarter numbers are an even bigger deal than usual, following Tuesday’s shakeout of an overcrowded AI trade that’s has been priced for perfection. As of 8:00am ET, S&P 500 futures are 0.3% higher with Nasdaq 100 contracts up 0.5%. In premarket trading, equities are boosted by a bid for Semis (MU +3.6% with earnings tonight) with most of Mag7 higher. Within Cyclicals, Discretionary and Industrials are the standouts as Energy / Fins are mostly lower. Cyclicals poised to lead Defensives with Momentum factor flat. Bond yields are lower 1-2bp as the yield curve flattens, pushing 10Y yields ; USD remains bid even as real yields decline. DXY set a new 52-wk high today. Cmdty remain under pressure dragged by the Energy complex and weakness in Metals. Today’s macro data focus is on Home Sales ahead of tomorrow's update on GDP, PCE, Personal Income / Spending, Cap / Durable Goods, and weekly Claims.

In premarket trading, Alphabet (GOOGL) is up 0.5% after news the Google parent will replace Verizon in the Dow Jones Industrial Average. Verizon (VZ) is down 0.5%. Other Mag 7 stocks are mostly higher (Nvidia +0.6%, Tesla +0.6%, Meta +0.1%, Apple +0.6%, Microsoft -0.5%, Amazon -0.2%)

• Cerebras Systems (CBRS) falls 14% premarket after the newly public chipmaker gave an annual sales forecast that disappointed investors looking for it to take a bigger slice of the AI data center market. 
• FedEx (FDX) is down 7% after the parcel delivery company posted its first earnings report since completing the spin off of its freight unit earlier this month. Results seem to have fallen short of investor expectations after a strong run-up in the first half of the year: the company cited margin pressure and global trade uncertainty in its outlook.
• FuelCell Energy (FCEL) rises 16% after the company said it reached an agreement with Fit Energy to supply 380 megawatts of clean on-site power for data centers using FuelCell Energy’s technology.
• Hertz (HTZ) slumps 16% after providing an update. The company also filed to offer $100m of stock.
• Twilio Inc. (TWLO) rises 3% as Goldman Sachs rates the software company buy with a Street-high $300 price target, citing AI tailwinds.
• Wendy’s (WEN) rises 23% as the stock climbed the ranks in Stocktwits and Reddit’s widely followed wallstreetbets forum.

In other company news, Qualcomm is hosting a highly anticipated investor day in New York. CEO Cristiano Amon and executives are using the event to outline the company’s next phase of growth and diversification strategy. And Nike is hiring David Denton as its next CFO, who is poised to leave Pfizer in August. SpaceX shares are fluctuating, after it sold $25 billion of investment-grade bonds.

While yesterday’s market action was wild for some chip stocks, there was no sense of over-reaction or panic across the market, according to Goldman traders. They said that on a 1 to 10 scale of overall activity level on their trading floor, the session was a 5, despite broad selling by long only and hedge funds. They also say that top-of-book liquidity remains shallow, exacerbating price action. 

The recent swings are sharpening the focus on Micron, one of the biggest beneficiaries of roaring demand for chipmakers that stand to gain from the billions of dollars being plowed into AI infrastructure. The stock is up more than 260% in 2026 even after dropping 13% on Tuesday, and has been a leader of the rebound from the S&P 500’s war-driven lows. Today's main event, the Micron earnings print, follows four of the six major market-moving events on June’s calendar: the CPI print, the SpaceX IPO, the US-Iran MoU, and Warsh’s first Fed meeting. The bar is high, positioning crowded and the semi/memory complex is nervous.

“The main problem for Micron is not Micron itself, but the expectations for its third-quarter earnings,” said Joachim Klement, head of strategy at Panmure Liberum. “Even if Micron has a stellar quarter and gives solid guidance, it may not be enough to fulfill lofty expectations.”

Traders warned of possible further swings in tech stocks if Micron’s earnings and outlook fail to meet sky-high expectations.

“For high-performing companies that reflect the dynamics of a sector, market expectations naturally rise,” said Guillermo Hernández Sampere, head of trading at MPPM. “From a rational standpoint, these are difficult to meet, and disappointments become apparent in the stock’s price performance.”

Evidence of the vast amounts of capital flowing into the buildout of AI infrastructure and its supply chain was again on display as South Korea’s SK Hynix Inc. announced it was looking to raise $29 billion in a US listing. The offering would add to the recent wave of AI-related funding secured through stock issuances, after SpaceX held the largest initial public offering in history earlier this month and Alphabet Inc. planned a $85 billion capital raise.

The sixth and final major market event on the docket this month comes on Thursday, with this week’s marquee economic release, the core PCE. Bloomberg Economics expects that a hot PCE reading will likely reinforce the hawkish tilt by the Fed at its meeting earlier this month.

Building on the AI funding theme, SK Hynix Inc. is planning to raise 45.45 trillion won ($29.4 billion) in a landmark US listing. That could put it among the top five share sales of all time, comparable with Saudi Aramco’s then-record 2019 initial public offering.

In geopolitics, oil oil is down for an eighth day in nine and back at about $72 barrel, with Brent dropping below $75 for the first time since the start of the war, as crude continues to price for lower geopolitical risk, higher supply and increasing traffic through the Strait of Hormuz. Separately, Trump is meeting defense industry executives later to talk about picking up the pace of weapon production. Lower crude prices pushed the cost of diesel in the US below $5 a gallon for the first time since mid-March.

Private credit also remains in focus as a $7 billion fund run by Morgan Stanley caps investor withdrawals at 5%, allowing less than half of the redemptions shareholders requested in the second quarter.

Europe's Stoxx 600 index is little changed and Germany’s DAX is lagging following a big drop for defense company Rheinmetall. Asian stocks slid amid a selloff in the region’s leading chipmaker TSMC and other technology names over concerns about the sustainability of demand for AI-linked shares and their valuations. The MSCI Asia Pacific Index dropped as much as 1.2%, before paring most of the losses. Taiwan and Indonesia led the region’s decline, while Japan also underperformed. Indonesia’s stock benchmark fell as much as 3.7% after MSCI Inc. again decided to postpone its review on the country’s equities, saying it needs more time to see whether recently announced transparency reforms are effective. Sectors to Watch

• Chinese semiconductor stocks rally as momentum in AI‑related investments lingered, while the news about TSMC lifting prices further lifts sentiment.
• Australia’s software-heavy technology sector rises as investors rotate out of Asian chipmakers amid valuation concerns that triggered a selloff in AI-linked shares.
• India’s software exporters are steadily losing their sway on the country’s stock market as concerns over artificial intelligence-led disruption trigger a prolonged selloff in the sector.
• Chinese shipping stocks gain after more vessels transit the Strait of Hormuz with tracking signals switched on, signaling rising confidence in the vital energy chokepoint.
• Chinese healthcare stocks advance after Citi says the sector’s current valuations fail to reflect improving fundamentals and resilient order books.
• Citigroup says this year’s 6.18 campaign was the quietest in the past 16 years, which does not bode well for June retail sales data and suggests downside risks to second-quarter earnings estimates for JD and Alibaba.

In FX, the dollar continued to benefit from haven demand as risk sentiment remained fragile. Advancing 0.3%, the greenback headed for its longest winning streak in more than a month and cemented its highest level of the year. Meanwhile,  the euro has fallen to the lowest since May 2025

In rates, treasuries rose modestly as inflation worries eased, with the 10-year yield falling two basis points to 4.48% supported by similar gains for European bonds during the London session, as oil prices extend their recent slide with tankers openly crossing the Strait of Hormuz. US long-end yields are about 2bp lower with shorter maturities little changed, flattening 2s10s and 5s30s spreads by almost 2bp. 10-year is about 1bp lower near 4.47%, UK counterpart by an additional 1bp. Treasury auction cycle continues with $70 billion 5-year note; Tuesday’s 2-year sale stopped through by 0.3bp. WI 5-year yield near 4.265% is ~8bp cheaper than last month’s auction, which tailed by 0.1bp. The dollar issuance slate includes three names so far. SpaceX led a $30b, four-offering calendar on Tuesday. Issuers paid about 11bp in new issue concessions on deals that were 2.9 times covered. Focal points of US session include 5-year note auction at 1pm New York time. 

In commodities, WTI crude oil futures are down around 2% near session lows as the US and Iran signal progress toward ending the war, weighing on energy prices. Brent fell below $75 for the first time since the war started. Gold slipped as the stronger dollar made bullion priced in the US currency more expensive.

US economic data calendar includes 1Q current account balance (8:30am) and May new home sales (10am). Fed speaker slate includes Governor Lisa Cook at 2pm

Market Snapshot

Top Overnight News

• Qatar’s prime minister said establishing a hotline between the US and Iran is essential to prevent rogue actors impeding the reopening of the Strait of Hormuz, as he predicted that the Gulf state would resume normal liquefied natural gas production “within a few weeks”. FT
• The US Senate voted 50-48 to pass a resolution to halt the Iran war unless US President Trump gets approval from Congress. However, the White House said Congress resolutions on Iran are non-binding and won't be sent to President Trump, while Trump criticised the Senate passage of the Iran war powers resolution, which he claimed provides aid and comfort for the enemy.
• Treasury Secretary Bessent said inflation will return to the target, and he is confident Fed Chair Warsh will optimize the path for the economy. Bessent also stated that the US housing issue is a conundrum affected by rate-lock owners, and will take lower rates and more supply, predicting inflation will ease as talks with Iran continue and gas prices fall. BBG
• Congress on Tuesday passed its most-ambitious housing legislation since the 1980s, a package of more than 50 provisions aimed at making it easier to build homes and make housing more affordable. The House passed the bill 358-32 with broad bipartisan support a day after the Senate voted 85-5 to approve the measure. President Trump is expected to sign it into law as soon as Wednesday. WSJ
• Leveraged ETFs tracking Samsung Electronics or SK Hynix probably sold a combined $6 billion of the Korean chipmakers’ shares yesterday to maintain their ratios, underscoring how such products are amplifying market moves. BBG
• The BoJ sees the risk of inflation exceeding its 2% target and will conduct additional interest-rate hikes appropriately, Governor Kazuo Ueda said in speech Wednesday that reiterated policymakers’ recent messaging. BBG
• Australia’s consumer price growth eased in May amid cooling fuel prices, but underlying inflation continued to strengthen as businesses passed on higher costs resulting from the Middle East conflict. WSJ
• Extreme temperatures in Western Europe triggered widespread school and transit disruptions across the UK and France. The failure of two transformers in Brittany, probably due to the heat, left 68,000 people without electricity, while the UK’s grid operator issued a rare summer power-supply warning. BBG
• Venezuela is set to reveal a $240bn debt pile, much higher than previously thought, as the country embarks on the biggest sovereign restructuring in history following the US removal of Nicolás Maduro. The country is on track to reveal borrowings that are significantly larger than market estimates of $150bn to $200bn when it lifts the veil for creditors on the state of its finances in the coming weeks. FT
• SK Hynix plans to raise up to $29.4 billion in a landmark US listing to increase its capacity to meet memory chip demand. At that size, the deal would be among the top five share sales of all time. BBG

A more detailed look at global markets courtesy of Newsquawk

APAC stocks saw mixed price action as the initial rebound from the prior day's tech-driven sell-off gradually waned in the absence of any fresh major catalysts. ASX 200 traded rangebound as strength in tech and defensives was counterbalanced by losses in mining and energy following the recent declines in underlying commodity prices, while inflation data was mixed and would likely have little bearing on monetary policy. Nikkei 225 failed to sustain early gains and dipped back beneath the 70,000 level, while Services PPI data printed in line with forecasts and the BoJ Summary of Opinions showed members continued to advocate for further rate increases. Hang Seng and Shanghai Comp were indecisive as the attention turned to the WEF in Dalian, where Premier Li said China's economy shows resilience and maintains sound momentum. He stated China remains committed to opening up and will continue to accelerate the large-scale application of new technologies.

Top Asian News

• Japan is reportedly looking at ways to streamline the management of its USD 1.3tln FX reserves to increase returns and help state finances, Reuters reported.
• A draft proposal of 1% consumption tax was presented and will reportedly be implemented from April 2027, FNN reported. The proposal faces significant resistance from opposition parties, with DPP representative Furukawa stating they have no intention of cooperating, leaving the prospect of a June agreement uncertain.
• Chinese Premier Li said China's economy shows resilience and maintains sound momentum, while he noted four key words for the economy including stability, innovation, dynamism and integration. Li also stated that China remains committed to opening up, as well as noted that China's AI sector sees explosive growth, and they will continue to accelerate the large-scale application of new technologies.

European bourses (STOXX 600 U/C) start Wednesday's trade broadly lower, with the AEX (+0.3%) outperforming as tech names steady from Tuesday's selloff. Germany's DAX 40 (-0.9%) is the clear underperformer, as Rheinmetall weighs on the index. The FT reported that Germany will scrap plans to build Rheinmetall's F126 frigates and instead purchase 8 Meko A-200 frigates from TKMS. Rheinmetall (-14%) has taken a hit following this news, while TKMS (+9.4%) benefits. European sectors print a mixed picture. Real Estate (+2.2%) is the clear outperformer, with Food, Beverages & Tobacco (+1.1%) and Consumer Products (+1.2%) rounding out the top 3. Media (-1.3%), Construction (-0.7%) and Energy (-0.6%) are the sector laggards.

Top European News

• UK MP Jones said that while he has the 81 seats required to run, he will not contest against Burnham for Labour leadership, Sky News reported. Jones further said he thinks traders "can be content" with Burnham as PM and added that he thinks there is room to "borrow a little more", and things (referring to investment) can be done differently, without "broad brush" borrowing and spending.
• Germany confirmed earlier reports that it will abandon plans to build 6 Rheinmetall (RHM GY) F126 frigates, and instead intends to buy 8 smaller Meko A-200 frigates from TKMS (TKMS GY).

FX

• G10s are weaker against the Buck as the risk-off mood continues into Micron earnings this evening. Antipodeans lag, as the Aussie digests mixed CPI, JPY fluctuates either side of unchanged, and EMs are getting hit.
• Markets are reluctant to buy the dip in equities after losses on Tuesday. As such, the Buck continues to firm as the preferred haven, with USD outperformance vs Scandis and Antipodeans with liquidity lower. Traditional havens fare better against the Buck, JPY steady at the lower end of its recent ranges, while CHF continues its downward trend. For US-specifics, the highlight of the session will be the Fed Bank Stress Test Report alongside Micron earnings - both due after the close. DXY trades at the upper end of its 101.35-101.68 range, higher by 0.2%.
• Aussie data was mixed, CPI in May cooled below expectations, and the trimmed mean firming in line with most forecasts to 0.4% M/M and 3.6% Y/Y. The report noted housing was the main inflation pressure point, and Westpac analysis notes price pressures are broadening, particularly within services. As such, with the recent energy related prices pressures set to linger, the RBA will be keenly monitoring signs of sticky inflation with the bank widely expected to have concluded tightening. AUD faring better than Kiwi (AUD/NZD +0.1%), but lower against the Buck as the mixed data does not provide a bias towards any future easing/tightening; Labour market data ahead.
• EUR and GBP are lacklustre and tracking the firmer Buck. Domestic catalysts light for both regions, though some continued incrementally optimistic updates from a likely incoming Burnham premiership which has helped GBP. EUR/GBP trades a whisker away from the 200 week moving average @ 0.8602 which is also the session low. For the EUR, recent Governing Council commentary remains hawkish, though nothing deviating too much from the Statement at June’s meeting.
• Barclays sees a moderate dollar-buying by month-end against most majors, with a weak sign on USDJPY.

Fixed Income

• Global fixed income benchmarks are slightly firmer, as energy prices continue to pull back and investors seemingly return to see bonds as a haven following the recent tech sell-off.
• USTs (+2 ticks) return to gains after pulling back from a 109-17+ top in Tuesday's session, currently trading at the top end of a 109-09+ to 109-15 range. The US data docket is light today, ahead of Thursday's busy day (PCE, GDP, initial jobless claims, durable goods). On the supply front, the US is to sell USD 70bln 5-year notes. The auction benefits from a combination of higher outright yields, reduced geopolitical uncertainty and a more hawkish Federal Reserve. The key question will be whether the improved backdrop can bring direct bidders back into the sector while maintaining the strong indirect demand seen at the previous auction.
• Bunds (+11 ticks) have been seen as attractive in recent sessions. Analysts see value in long-end German debt, with UBS stating that yields should be capped given any further hike by the ECB is expected to be quickly reversed as it would worsen the trade-off to growth, while rates strategists at Commerzbank say Bunds remain better supported as tech stocks struggle and worries of an AI-bubble. The German IFO data was mixed, with current conditions beating estimates while expectations came in soft; however, no move resulted. German 10yr yield has now returned to 2.90%, with Bunds currently trading at the top end of its 126.67-126.98 range.
• Gilts (+18 ticks) outperform, supported by the lower energy prices and the removal of some political risk premium after Starmer's chief secretary (and former chancellor) Jones said he will not contest against Burnham for the top job. Jones also thinks the bond market can be content with Burnham as PM. Analysts at ING see limited upward risk in terms of rates, but state that political uncertainties are likely to keep upward pressure on gilts, especially the longer end. UK 10yr gilts currently in a 89.33-89.64 range.
• Germany sells EUR 1.785bln vs exp. EUR 2bln 4.00% 2037 and 3.40% 2047 Bund.
• The UK sells GBP 4.25bln 4.125% 2031 Treasury Gilt: b/c 3.47x (prev. 3.36x), average yield 4.284% (prev. 4.651%), tail 0.1bps (prev. 0.2bps).
• Italy sells EUR 2.5bln vs exp. EUR 2-2.5bln 2.20% 2028 BTP and EUR 1.75bln vs exp. EUR 1.5-1.75bln 2.40% 2039 BTPei Auctions.

Commodities

• In geopolitics, the US and Iran are continuing to finalise an agreement within the 60-day negotiation period. Amidst the talks, US President Trump reiterated that they are making a deal with Iran and will see how it goes. Currently, there are conflicting remarks made by US and Iranian officials. There appears to be disagreements surrounding the inspection of Iranian nuclear sites, and on potential tolling of the Strait of Hormuz.
• WTI and Brent are continuing to decline, posting losses of c. 2%. This comes amidst the continued flow of ships traversing through the Strait of Hormuz, albeit still remaining far below pre-war levels. From an oil perspective, estimates suggest that around 6-7mln bpd of oil went through the Strait in the past few days (vs 20mln bpd pre-war). Elsewhere, focus has also been on comments via the Russian Deputy PM Novak, who stated that the country is mulling a diesel export ban, to help ease domestic shortages. Brent Aug’26 currently trades at the bottom end of a 75.53-77.00/bbl range.
• Dutch TTF remains fairly steady, despite the Hormuz flows as focus remains on the heatwave across most of Europe. Attention has also been on French nuclear reactors, which typically need to be shut if the plant cannot cool itself efficiently. Already some EDF reactors have had to shut or taper output, but on the whole France’s national power grid operator said France has enough capacity to meet recent demand.
• Spot gold continues to extend on Tuesday’s losses, and has made a WTD trough at 4,050.47/oz (vs USD 4,115/oz peak). Action which is a continuation of recent losses, stemming from the hawkish repricing at the Fed, stronger USD/higher yields and as sell-side banks continue to trim their PT for the yellow-metal. 3M LME copper trades at the lower end of a USD 13,358-13,483.1/t range.
• US Private Inventory Data (bbls): Crude -0.8mln (exp. -5.0mln), Distillates +1.4mln (exp. -0.4mln), Gasoline +1.2mln (exp. -0.4mln), Cushing -1.0mln.
• US President Trump commented that the big oil companies are not dropping their prices at the pump commensurate with the lower prices they are paying for oil and customers are being 'gouged', while he has instructed the DoJ to look into this and stated that gasoline prices better start going down a lot faster than he is seeing.
• Qatar's PM and Foreign Minister said that the country will resume normal LNG output within weeks, according to the FT.
• Jera Chairman said that restoring Qatar’s LNG facilities, which were damaged during the Iran war, may likely take more than two or three years.

Trade/Tariffs

• Brazil will maintain its scheduled tariff hikes on imported electric and hybrid vehicles, with a 35% import tax on assembled and semi-assembled EVs taking effect in July, while disassembled vehicles will face the same rate from January 1st, 2027. Brazil will also introduce additional zero-duty import quotas for disassembled and semi-assembled EVs starting July 1st, providing limited relief for automakers amid higher import barriers.

Central Banks

• BoJ's Ueda said the timing and pace of future hikes will be decided by scrutinising the likelihood of baseline forecasts materialising, as well as risks. He added that there is risks that underlying inflation may overshoot 2%, but that Japan's economy is recovering moderately albeit with some weakness. Financial environment remains accommodative after recent rate hike; continues to support economic activity.
• BoJ Summary of Opinions from the June meeting noted a member said it has become more appropriate to adjust the degree of monetary support as FX moves are pushing up import prices, and a member said it is appropriate to continue raising interest rates as financial conditions are accommodative. There was also the opinion that even after a June rate hike, the BoJ must maintain its stance of proceeding with further rate hikes if the economy and prices move in line with forecasts. The Summary of Opinions also stated they must push up the BoJ's policy rate closer to the neutral rate as soon as possible and to near neutral at an early date to avoid big and sharp rate hikes in the future. Furthermore, a member said Japan's neutral rate is seen at around 2%, and the BoJ must raise its rates once every few months, while a member said there was no reason for the BoJ to halt a reduction in its JGB purchases.
• RBA’s Hauser said that there have been important economic developments since May and not least the chance of a US-Iran deal. Hauser said the RBA took proactive policy action to reduce excessive capacity pressures through rate hikes, while timely policy steps to reduce inflation could have lower unemployment costs. The RBA still has work to do to reduce inflation, which remains far too high.
• Riksbank Minutes (Jun): Governor Thedeen said it is reasonable to indicate that it is now somewhat more likely that we will raise the policy rate in the future. I think that this forecast is still reasonable, given the signals now coming with regard to a solution to the war between Iran and the United States.

Geopolitics: Middle East

• Pakistan's Foreign Ministry said it is conducting communications between US and Iran to effectively implement the MoU and that technical talks will continue next week; potentially Monday or Tuesday.
• Israel and Lebanon are in talks on a US-supported pilot project involving the withdrawal of Israeli troops from some parts of southern Lebanon and hand it over to Lebanese forces, according to several Israeli officials.
• Iranian Parliament Speaker Ghalibaf said Iran extends its hand of brotherhood and cooperation to all countries in the region and is ready to establish security agreements with all countries in the Middle East.
• Iranian senior commander said Iran's military has shifted to an aggressive doctrine.
• Oman established a temporary shipping lane in the Strait of Hormuz, according to IRNA. Furthermore, the Maritime Security Center in Muscat said Oman coordinates with the IMO for ships to pass through the Strait of Hormuz "without fees", according to Al Jazeera.
• Israeli Military reportedly preparing for redeployment in southern Lebanon, Al Hadath reported citing Maariv.
• Israeli tanks advanced towards Beit Yahoun in Lebanon, with heavy gunfire reported near Beit Yahoun and Kounin, while it was also reported that Israeli strikes hit the Lebanese coastal city of Tyre. Furthermore, Israeli fighter jets reportedly attacked a school in the At-Tuffah neighbourhood in eastern Gaza, and Israeli military entered Syria's Quneitra province.

Geopolitics: Ukraine

• Russia is reportedly considering a new wave of mobilisation as early as October 2026.
• Russia gas plant in Orenburg was targeted overnight by drones, Kyiv Post reported.

Geopolitics: Other

• North Korea leader Kim Jong-un said North Korea will build two Choe Hyon-class warships annually over the next five years, as it advances the nuclearisation and strategic expansion of its navy, while Kim said they will equip their destroyers with nuclear weapons.

US Event Calendar

• 7:00 am: United States Jun 19 MBA Mortgage Applications, prior -3.8%
• 8:30 am: United States 1Q Current Account Balance, est. -208.9b, prior -190.74b
• 10:00 am: United States May New Home Sales, est. 639.89k, prior 622k
• 2:00 pm: United States Fed’s Cook Gives Pre-Recorded Opening Remarks

DB's Jim Reid concludes the overnight wrap

After chipmakers led a continued US tech sell-off last night, the market mood is more mixed in Asia this morning. Korea’s KOSPI (+0.82%) is rebounding after yesterday’s sharp -9.99% drop, initially rising around 4% as heavyweights Samsung (+4.35% vs. -12.90% yesterday), recover, although SK Hynix (-2.96% vs -13.18% yesterday) continues to hover around its losses. Elsewhere, the Nikkei (-1.80%) is registering a steeper decline, while China is mixed with the CSI 300 (+0.12%) up and the Shanghai Composite (-0.25%) down. The Hang Seng (+0.04%) and Australia’s S&P/ASX 200 (+0.07%) remains marginally flat. And this morning, US equity futures have risen, with those on the S&P 500 (+0.17%) pointing to a modest recovery after the index fell -1.44% yesterday, while Nasdaq 100 futures are up +0.39%. 10yr USTs are also -1.2bps lower and hovering around 4.49% as we go to print.

Elsewhere this morning, the yen is hovering near its weakest since 1986 (161.55 against the US dollar) as concerns that Japanese authorities may intervene to curb further losses continues. The yen’s low follows the BoJ’s latest summary of opinions that came out earlier overnight, where policy members continued to press for further rate hikes after the group raised Japan’s policy rate to 1% last week, although the summary did not mention when the likely timing of the next move will be. As a reminder, our Japan economist forecasts the next BoJ hike to be this October, followed by quarterly hikes thereafter until reaching 1.75% in April 2027. 10yr JGBs (+0.4bbps) are slightly higher as I type.

We also had overnight data that showed Australia’s CPI rose +4.0% y/y in May (vs +4.3% est and +4.2% prior). Trimmed mean CPI edged up to +3.6% y/y from +3.4% prior. So while the softer headline suggests easing inflation—helped by lower oil prices amid easing US–Iran tensions—underlying pressures remain sticky, likely keeping the RBA on a hawkish footing.

Ahead of those overnight developments, markets saw a classic risk-off move yesterday, with equities sliding and bonds rallying. The main catalyst was another selloff in tech stocks, and chips in particular. Indeed, the Philly semiconductor index (-7.87%) saw its biggest fall since the jobs report at the start of the month, back when it fell over -10% in a single day. This decline included Sandisk (-13.64%) and Micron (-13.18%) as the two worst performers in the S&P 500 yesterday, though they remain among top four performers YTD. Given the importance of semiconductors for US equities, that dragged down the broader indices, with the NASDAQ slumping -2.21% yesterday, whilst the S&P 500 fell -1.44%. Indeed, the concentration of the decline was striking, as it was the first time this year that the S&P 500 was down more than 1% on a day when majority of companies in the index were actually higher. Over in Europe, the divergence wasn’t quite so marked, but the STOXX 600 (-0.73%) still posted its worst day in three weeks as tech stocks led the declines.

Interestingly, this equity weakness happened despite a couple of good news stories on the economy yesterday. The first was the flash PMIs for June, which generally surprised on the upside, suggesting that the global economy was still coping better with the energy shock than many expected. Indeed, the US composite PMI hit a 5-month high of 52.2 (vs. 51.1 expected), a level we haven’t seen since the Iran conflict began. And in the Euro Area, the composite PMI also rose more than expected to 49.5 (vs. 49.2 expected), so collectively the numbers painted a decent narrative about the global economy at the end of Q2.

On top of the PMIs, yesterday also saw a fresh tailwind in the form of lower energy prices, with Brent crude (-1.05%) down to a 3-month low of $77.08/bbl. That came as investors remained hopeful that the shipping through the Strait of Hormuz would normalise before long, with data pointing to more vessels going through, even if they’re only creeping up slowly. On the topic of the Strait of Hormuz, we also have a DBRI note (link here) looking at the path to normalisation, the implications, and an analysis of the different sectors impacted by the closure. It's a collaboration between numerous macro and micro analysis and is a comprehensive look at where various products and sector are after several weeks of the strait being closed and now reopening.

 With oil prices coming down, that helped to ease fears about stagflation considerably. In fact, the US 1yr inflation swap (-7.1bps) fell to just 2.28%, which is actually beneath its level before the Iran conflict began. And similarly, the Euro 1yr inflation swap (-8.0bps) fell to 2.45%, its lowest since early March. So that led investors to price out the chance of rapid rate hikes this year, with futures pricing 38bps of Fed rate hikes by December, down -3.0bps from its cycle high the previous day. And for the ECB it was much the same story, with just 31bps of cuts priced by December, down -1.1bps on the day.

That backdrop of lower oil prices, easing inflation fears, and more dovish rates pricing was very supportive for sovereign bonds. In fact, the 10yr bund yield (-3.2bps) hit a 3-month low of 2.92%, whilst yields on 10yr OATs (-2.8bps) and BTPs (-1.0bps) also fell. That came in spite of comments from ECB chief economist Lane, who said that ECB officials faced the risk of inflation remaining above target “for quite some time”. But ultimately, the deflationary impact of lower oil prices helped to ease fears about a more hawkish response yesterday. Indeed, US Treasuries saw a similar impact, with the 10yr yield (-1.2bps) slipping back to 4.50%.

One exception from the largely positive data picture was Germany, whose flash composite PMI fell to 48 from 48.8 in May, notably below the 49.7 expected with services being the main drag. However, the survey was before the MoU was signed between the US and Iran so analysts will be looking for a recovery in the final figures. Staying with Germany, Marion Muehlberger highlights a positive surprise in the pension reform plans announced yesterday. Her piece (link here) discusses the introduction of a mandatory funded component, with an additional 2pp of gross salaries to be invested in a centralised public pension fund, phased in gradually until 2031. This is expected to result in around €35bn of additional investment into capital markets, with no pre-defined asset allocation or country split. Sweden’s “premium pension” serves as a model. As well as improving the sustainability of Germany’s public pension system in the context of an ageing population, this could also provide a meaningful boost to German and European capital markets.

Here in the UK, gilts outperformed yesterday after the flash PMIs were also weaker than expected. The composite PMI unexpectedly fell to 49.4 (vs. 50.5 expected), meaning it was still in contractionary territory. So coupled with the decline in oil prices, that led to growing doubt about a Bank of England rate hike happening this year. In turn, that meant the 10yr gilt yield fell -5.4bps to 4.75%, a bigger decline than the other big European economies. Meanwhile on the political scene, Andy Burnham is still the only declared candidate at present to become the next Labour leader and PM. So if that stays the case (and any candidate still needs 20% of Labour MPs to nominate them), Burnham could theoretically become the new leader as soon as mid-July.

Looking at the day ahead, and data releases include the Ifo’s business climate indicator from Germany, and US new home sales for May. From central banks, we’ll hear from the ECB’s Nagel, Cipollone and Moulin, along with the BoE’s Breeden and Dhingra. Finally, today’s earnings include Micron.

Tyler Durden Wed, 06/24/2026 - 08:25

Mamdani-Backed Candidates Win New York House Primaries

Authored by Nicholas Zifcak & Jackson Richman via The Epoch Times,

All three candidates endorsed by New York City Mayor Zohran Mamdani won their closely-watched House primary races on Tuesday, handing the democratic socialist a victory in his bid to move his party more to the left.

Democratic congressional candidate Brad Lander (R) arrives with New York City Mayor Zohran Mamdani for an election night watch party in New York City on June 23, 2026. Ryan Murphy/AP Photo

On the job for fewer than six months, the mayor waded into three congressional primary races, backing democratic socialists and progressives against more established Democrats.

Mamdani-endorsed former New York City Comptroller Brad Lander defeated Rep. Dan Goldman, whose seat spans lower Manhattan and part of Brooklyn.

In the race to succeed retiring Rep. Nydia Velazquez, Mamdani-endorsed Assemblymember Claire Valdez, a self-described democratic socialist, beat Brooklyn Borough President Antonio Reynoso, who was backed by Velazquez.

Rep. Adriano Espaillat, 71, was defeated by Mamdani-backed Darializa Avila Chevalier, 32, a democratic socialist.

Mamdani's endorsements had put him at odds with other prominent New York Democrats. New York Gov. Kathy Hochul endorsed Espaillat and campaigned alongside Goldman.

In these solidly blue districts, primary elections are highly competitive, with the Democratic contender expected to win easily in November.

Community Organizer Beats Rep. Espaillat

In an upset, PhD student and community organizer Chevalier beat out fellow Dominican, Congressman Espaillat. The district, which includes Harlem and parts of the Bronx, has been represented by Espaillat since 2017.

Chevalier received a significant boost when Mamdani announced his support for her candidacy in late May. Even so, in a debate just days before the primary, Chevalier faced pointed questions about past Twitter posts in which she attacked major Democratic party leaders, including former President Joe Biden (who she called "racist"), as well as cursing former Vice President Kamala Harris. She also called the United States "a[n expletive] disgrace," and called for the end of the police.

Chevalier has been outspoken against Israel, criticizing Espaillat for accepting funds from the American Israel Political Action Committee (AIPAC). Espaillat criticized her for attending a pro-Palestinian rally just one day after Hamas's Oct. 7, 2023, attacks on Israel.

Chevalier worked on the mayor's campaign last year.

Assemblymember Valdez Wins

Mamdani-endorsed Valdez beat Reynoso for the Democratic nomination for the seat of retiring Velazquez.

The veteran Hispanic congresswoman representing Brooklyn and Queens was an early supporter of Mamdani, and was displeased when the mayor endorsed Valdez rather than her preferred candidate, Reynoso, for the seat she is vacating. Up and down the ballot, Velazquez endorsed a string of candidates running against Democratic Socialists of America candidates.

Democratic Socialists of America member Valdez was an early supporter of Mamdani since late 2024 when he first launched his run for mayor. She received Mamdani's endorsement in January.

Rep. Goldman Defeated by Lander

Lander succeeded in beating out Goldman for the Democratic nomination to represent the 10th district in Congress.

Lander, who also received Mamdani's endorsement, was a vocal Mamdani supporter after his run for mayor ended with the June 2025 primary. Lander has joined some current House members in calling for an end to U.S. aid for Israel.

Both candidates have described themselves as liberal Zionists, but Lander has attacked Goldman for supporting U.S. military aid to Israel and for accepting money from AIPAC.

The Epoch Times spoke with voters in the 10th district. Michael Bedrick said he mainly came to vote to support Goldman, who he said has earned his vote.

"I'm really kind of sick of the left's attack on Israel," Bedrick, an attorney, said.

"I understand there's a lot of problems with the Israeli government itself, but I want our interests aligned with democracies and not with Islamic fundamentalists."

Another voter in the 10th District, Benjamin Patrusky, said affordability was his primary concern. He said he was looking for progressive candidates who would work to push out President Donald Trump.

"Anyone who's a strong progressive and leaning in the right direction, and has a forceful voice, will be important to me," Patrusky said.

Lander received 65.8 percent of the vote to defeat Goldman, with 86 percent of the votes counted.

Lasher Wins Primary for Nadler's Seat

State Assemblyman Micah Lasher beat out seven other candidates for the nomination to replace retiring Rep. Jerry Nadler (D-N.Y.).

The race attracted a field of eight candidates. The two state assemblymen, Lasher and Alex Bores, stood out. Lasher received endorsements from former bosses Nadler, Michael Bloomberg, and Hochul; while major unions UAW, AFL-CIO endorsed Bores along with Rep. Patrick Ryan (D-N.Y.). Other candidates in the race included former Republican and never-Trumper John Conway, USAID public health expert Nina Schwalbe, and John F. Kennedy's grandson Jack Schlossberg.

Schwalbe, who spoke with The Epoch Times at a polling station, said voters in the 12th District are concerned about housing and healthcare.

"People are losing their Medicaid benefits. They're getting these letters about work requirements. They're losing their SNAP benefits," Schwalbe said.

Schwalbe said she and her campaign have knocked on 4,000 doors.

"And then people are worried about rule of law and the existential crisis of Trump," she said.

Even so, the issue of regulation of artificial intelligence (AI) played an outsize role in the campaign.

In a video, Bores called the contest a referendum on the regulation of artificial intelligence (AI). Bores previously worked at Palantir and helped pass a state law last year called the Raise Act, requiring AI developers to publish safety plans.

New York's 12th Congressional District encompasses the Upper West and Upper East Sides in Manhattan. In the state assembly, Bores represents the Upper East Side and Lasher represents the Upper West Side.

Lasher has a long history in New York politics, working as director of policy for Hochul prior to becoming a state legislator. He also worked as chief of staff to the state attorney general, as well as legislative director for former Mayor Michael Bloomberg.

Voters in the 12th District shared their thoughts on the election with The Epoch Times.

Shaughna Bishop, a psychologist, said one of the main things that guides her vote is LGBTQ rights. For this election, she said the debate over regulating AI also impacted her decision, which wouldn't normally be the case. She also considered a candidate's experience as a legislator in local government. "Jack Schlossberg is cute, but he hasn't done anything." Bishop decided to vote for Alex Bores.

Her son Cole Bishop, who also voted on June 23, said regulating AI was the most important issue for him. "I am probably much more motivated by the debate on AI. I think the rapid consumption of our clean water is going to be devastating."

Michelle Roseblatt, retired, another voter in New York's 12th District, said it's important to vote. "It's our duty. It's an honor to vote. People die and give their lives in other countries to vote," Roseblatt said.

"All those new voters who signed up in the mayoral election, where are they now? Are they sitting this out? Because every election is as vital as the last one."

Army Veteran to Challenge Rep. Lawler

Incumbent Republican Rep. Mike Lawler will face Army veteran Cait Conley.

Conley won the Democratic primary, defeating Rockland County Legislator Beth Davidson, Tarrytown Trustee and nonprofit executive Effie Phillips-Staley, and journalist Mike Sacks.

Lawler has represented the district, based in the Hudson Valley, since 2023.

The Cook Political Report rates the race as a toss-up.

Trump-Backed Candidate Wins Primary for Rep. Stefanik's Seat

Manufacturing executive Anthony Constantino defeated New York State Assemblymember Robert Smullen. President Donald Trump endorsed Constantino.

Dairy farmer Blake Gendebien won the Democratic primary.

Whoever wins will succeed Republican Rep. Elise Stefanik, who declined to run for re-election.

Shaughna Bishop and her son Cole Bishop said the debate over regulating artificial intelligence affected their decision. They voted in Manhattan, N.Y., on June 23, 2026. Nick Zifkac/The Epoch Times Tyler Durden Wed, 06/24/2026 - 08:05

Chip Party Must Go On: SK Hynix To Raise $29 Billion In US Listing

About two days after a Chosun media report from South Korea sparked a global sell-off in memory stocks and triggered a 10% crash in the Kospi, a new report states that memory giant SK Hynix is planning a massive $29.4 billion US listing. This move will test investor appetite for another mega AI-linked offering and demonstrate whether markets can absorb another massive listing weeks after the SpaceX IPO.

Bloomberg reports the offering would be the largest U.S. listing by a Korean firm and the biggest ever via American Depositary Receipts, easily exceeding Alibaba's $25 billion 2014 debut.

The offering is being led by Bank of America, Citigroup, Goldman Sachs, and JPMorgan. SK Hynix is at the center of the AI infrastructure buildout, serving as one of the top suppliers of high-bandwidth memory chips used in AI chip stacks at data centers.

The listing gives SK Hynix access to a much broader and more liquid US investor base, which could help narrow its valuation discount to Micron - similar to how TSMC's ADR listing attracted global flows and sustained a premium valuation.

UBS analyst Nicolas Gaudois's first take on the news:

Headline:

ADR listing targeted 10 July, to raise up to Won45tn, 17.8m shares (1 to 10 ADRs; 2.5% of outstanding).

Our Take:

Size/timing in line with investor expectations. We expect SKH to buy back shares to maintain SK Square ownership >20% (currently 20.5%). We believe SKH will continue to buy back and possibly issue some in the US to provide more liquidity over time.

CLSA Analyst Sanjeev Rana said the US listing of SK Hynix will help boost liquidity in the stock and propel a further rally.

"If they can get at least a valuation multiple similar to Micron, for example, then the local shares also need to reflect that, so that kind of expectation is there," Rana said. "I wouldn't be surprised if this rally continues."

Pictet Asset Management analyst Jon Withaar said, "A large part of the motivation behind this is no doubt the success of TSMC ADR which is very liquid, trades at a persistent premium to the Taiwan line and is accessed readily by globally investors."

"While we might see some sell on the news, the news is overall positive for SK Hynix," said Kevin Net, head of Asian equities at Financière de l'Echiquier. "The listing will help SK Hynix receive more funding for further investment, and it will also drive higher probability for more shareholders return and reduce valuation discount to Micron."

Meanwhile on Tuesday:

• Ahead Of The Korea Open: Goldman Warns More Selling On Deck, As Everyone Dumps On Retail
• Korea Crashed: Goldman Explains What Happened And Why It Matters

Surging demand for HBM chips has sent SK Hynix shares in Seoul soaring, with retail investors piling into chip trades. The stock has climbed about 306% this year, pushing the company's market value above $1.2 trillion.

To keep that momentum alive, SK Hynix now appears to be turning to the US investor pool. Its planned US listing, expected to begin trading on July 10, would certainly provide a more direct way to buy into the HBM boom.

Tyler Durden Wed, 06/24/2026 - 07:45

Tanker Owners Having The Best Week Of The Hormuz Crisis As VLCC Rates Soar

By Julianne Geiger of OilPrice.com

The Strait of Hormuz may be reopening, but don't tell tanker owners the crisis is over. They're making too much money.

As Middle Eastern producers scramble to move crude that has spent months stranded in the Persian Gulf, tanker rates have exploded higher, turning a slow return to normal into a windfall for shipping companies.

According to Reuters, the cost of hiring a tanker in the Gulf has nearly doubled in just a week, jumping from around $106,000 per day to more than $190,000 per day. For some very large crude carriers (VLCCs) hauling cargoes through Hormuz, daily earnings have surged to nearly $470,000—a level that would have seemed absurd before the war began.

Oil prices have spent much of the past week falling as traders price in the return of Middle Eastern supply, with Brent futures trading at $77 on Tuesday afternoon. Meanwhile, the people actually moving that oil are charging some of the highest rates seen during the entire crisis.

There still aren't enough ships.

Even after Iran lifted its effective blockade last week as part of the 60-day ceasefire agreement with the United States, traffic through Hormuz remains well below normal levels. Before the war began in late February, roughly 125 ships passed through the chokepoint each day. Current traffic remains a fraction of that.

At the same time, roughly 100 tankers are still trapped inside the Gulf carrying cargoes loaded during the conflict.

Now producers want their barrels moving again.

Abu Dhabi's ADNOC has been aggressively marketing crude cargoes, while refiners in major importing nations such as India are seeking additional Middle Eastern supplies after months of disruption. The result is a sudden surge in demand for ships just as vessel availability remains unusually tight.

The futures market has largely moved on from the crisis, but the shipping market clearly hasn't.

Until more vessels begin moving through the world's most important oil chokepoint, tanker owners may remain among the biggest winners of a conflict that cost almost everyone else dearly.

Tyler Durden Wed, 06/24/2026 - 07:20

Rheinmetall Plunges After Germany Scraps Warship Order

Rheinmetall shares plunged as much as 17%, the largest intraday drop in more than a year, after the Financial Times reported that Berlin has scrapped a multi-billion-euro program to build six F126 frigates.

The German Ministry of Defense told FT on Wednesday that the decision was due "to significant delays in the project, foreseeable cost increases and the risks that would have been associated with a change of main contractor," adding that changing the contractor would have added even more costs but also required the government to contractually "waive potential claims for damages against the previous contractor".

The ministry noted that it now plans to procure eight MEKO-200 frigates from TKMS instead. "Sea-based anti-submarine warfare is of the utmost importance within NATO and is therefore also a national priority," it said.

TKMS shares in Germany jumped 10% on the news.

Morgan Stanley analyst Marie-Ange Riggio said the report was a surprise, especially because Rheinmetall had been confident it would secure the contract before summer.

Riggio said it raises questions about German defense procurement visibility and Rheinmetall's near-term naval ambitions, but it should not materially affect current guidance because deliveries were not expected until 2031, leaving a limited impact on 2030 targets.

Here is Citi analyst Charles Armitage's first take on the news:

It has been widely reported (Bloomberg, 24/6/26, here) that Germany will cancel the F126 frigate program (and buy 8 MEKO frigates from TKMS instead, 4 more than previously). We have been cautious of Rheinmetall's ability to ramp Naval sales up to Eur5bn by 2030 and forecast Eur2.5bn sales in 2030 (see Figure 38 of our initiation report, which also gave Eur115 of further upside if Eur5bn sales were to be obtained) – following the reported cancellation, this seems more likely (with our existing group forecast of Eur37bn sales in 2030 also looking more valid).

Two points: 1) our valuation of Eur1,000-1,100 per share for the non-ammunition business still stands, plus Eur300-500 per share for the ammunition, giving our Target Price of Eur1,408, which remains valid; 2) that said, the incremental news today would appear to call the Naval targets into question – suggesting an estimated ~Eur115 downside risk to the share price.

Barclays analyst Afonso Osorio says, "This comes as a surprise, weighs on sentiment, and raises questions about how quickly defense spending will evolve."

Tyler Durden Wed, 06/24/2026 - 06:55