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UN Maritime Boss Warns Ships To Avoid Hormuz As Transits Continue

The International Maritime Organization warned Wednesday that the Strait of Hormuz remains too dangerous for commercial shipping, even as vessels continue to transit the narrow waterway.

US Central Command said its latest round of strikes against Iranian coastal military targets concluded early Wednesday. Tehran retaliated with missile and drone attacks against US-allied Gulf states while continuing to disrupt some maritime traffic through the strait.

Yet commercial ships are still transiting, suggesting Iran's ability to fully weaponize the maritime chokepoint is gradually eroding under sustained US air and naval superiority.

Speaking on Bloomberg Radio, Arsenio Dominguez, the secretary general of the IMO, said the waterway remains dangerous and unsafe for tankers and bulk cargo ships.

"I will maintain the message of upholding international law, for countries to do the same thing, and for companies — at this stage, particularly with the volatility — not to take risk to transit through the strait of Hormuz," Dominguez said.

Dominguez's warning appears to be ignored by some ships.

Strait of Hormuz risks deepen despite slight rise in crossings

Vessel activity through the Strait of Hormuz increased slightly on 14 July, with 21 confirmed crossings recorded, according to #MarineTraffic data. Commercial traffic accounted for most movements, including vessels… pic.twitter.com/oIkrtu2kGl

— MarineTraffic (@MarineTraffic) July 15, 2026

Bloomberg data show that vessel traffic continues in the narrow waterway, at lower volumes than last week, even as fighting between the US and Iran intensified overnight.

With or without Tehran's cooperation, US-allied Gulf countries are in the beginning innings of what we've described as a "great energy rewiring"...

Latest:

• Great Rewiring: US Supports Iraq-Syria Oil Pipeline To Erode Tehran's Hormuz Leverage
• Dubai's New East Coast Port Signals The Beginning Of End For Iran's Hormuz Leverage
• "Zero Hormuz Dependency": UAE Races To Rewire Energy Flows, Bypassing Chokepoint Chaos
• Hormuz Bypasses Maxed Out: Saudi East-West Pipeline Hits Record 7 MMb/d, As UAE Fujairah Crude Loadings Reach Capacity

We compiled evidence for readers showing that US-allied Gulf countries are poised to undertake a generational rewiring of regional energy flows to bypass the Hormuz chokepoint. Over time, that infrastructure buildout - from pipelines to ports - could render Tehran's leverage over the critical waterway increasingly irrelevant.

Tyler Durden Wed, 07/15/2026 - 14:00

Iraqi Militia Vows To Disrupt Any Future Iraq-Syria Oil Pipeline: US 'Stealing Our Oil'

Via The Cradle

US and Iraqi officials are set to conclude a major energy deal as part of Prime Minister Ali al-Zaidi’s visit to Washington this week, according to Iraqi officials cited by AP Wednesday.

"An agreement is slated to be signed Friday between Iraq, US companies Chevron and TI Capital, and Qatar’s UCC for construction of an oil pipeline that will connect southern Iraq’s Basra to western Iraq’s Haditha," the officials said.

via Reuters

The pipeline is meant to extend from Haditha to Turkiye’s Ceyhan port and the port of Baniyas in Syria. 

The details of the reported agreement were not discussed publicly during meetings between Zaidi and US President Donald Trump in the Oval Office on Tuesday. Neither the US president nor the Iraqi premier mentioned the deal. AP referred to it as a “significant energy deal.”

A senior Trump administration official said later on 14 July that Washington is “facilitating conversation” between Iraq and Syria regarding potential future energy projects.

Meanwhile, Iraqi pro-Iran resistance faction Al-Nujaba Movement warned against making deals with Washington in Iraq.

“[Trump] will not continue living under the illusion of stealing Iraq's oil and wealth, whether through direct theft or under the cover of suspicious investments. The Islamic resistance will continue confronting US forces and drive them from Iraq's land and skies,” the movement’s leader Akram al-Kaabi said in a statement on Wednesday.

The new Iraqi prime minister’s visit to Washington is expected to last until Saturday. 

On Tuesday, the premier said that Iraq deserved an equitable allocation within OPEC, coming during discussions with Trump in the Oval Office. His comments were a response to questions on whether Iraq was considering withdrawing from the oil producers' alliance.

“Iraq is one of the founding members of OPEC ... Our right is to receive a fair share for Iraq,” Zaidi said to reporters during the meeting with Trump. 

“The damage suffered by Iraq exceeds $400 billion, and to this ⁠day some Iraqis still have destroyed homes and are living in camps. I have a plan to return them to ⁠their homes, and that is why I want a fair share for Iraq in OPEC,” the Iraqi premier went on to say. 

During the meeting at the Oval Office, Trump called Zaidi “young” and “handsome,”  and that he had “tremendous chemistry” with the new Iraqi prime minister. 

In a press briefing between the two leaders, Baghdad and Washington announced that US combat troops would withdraw from Iraq by September 30. 

Zaidi was sworn in as premier in May this year, succeeding former prime minister Mohammed Shia al-Sudani. This came after the president had threatened to “cut off” Iraq completely if Nouri al-Maliki – a former Iraqi premier with ties to Iran – was re-elected. 

Despite initially vowing to continue running, Maliki ended up withdrawing his candidacy. “Mark my words, I knew what I was doing,” Trump said as he sat near Zaidi in the Oval Office on Tuesday.

“This man is going to be a great leader … beyond Iraq. His influence is going to spread all throughout the [region],” he said, referring to Zaidi. Zaidi’s visit coincided with reports of a major escalation of US pressure tactics, aimed at forcing the Iraqi resistance to surrender its arms.  Sources told the New Arab on Wednesday that Washington has “hardened its stance” against resistance factions in the country. 

Trump: Soleimani—I killed him…a very bad person from Iraq happened to be killed in that same incident . So I don't know if I did you a favor or not. I've never asked you that question.

Iraq PM: I was not in politics…. I'd like to talk about the future pic.twitter.com/8GDvhUadTD

— Acyn (@Acyn) July 14, 2026

The Trump administration has adopted a significantly more coercive approach than its predecessors to disarming the Iraqi resistance, stepping up pressure on Baghdad in recent months to dismantle the resistance factions swiftly.

Washington reportedly froze security programs with Baghdad and blocked dollar shipments to the country earlier this year to pressure Iraq into dismantling Iran-backed resistance groups.

Late last month, Baghdad issued a 30 September deadline for the disarmament of all armed factions in Iraq, including resistance movements.

After months of heavy US pressure, some armed organizations have agreed to turn over weapons to the state. Many others, including resistance groups Kataib Hezbollah and Al-Nujaba Movement, have refused.

Iraqi resistance groups demand a full US withdrawal, rather than the “transitional” pullout agreed on between Washington and Baghdad, which will see Washington shift from a “combat” to an “advisory” role, while still retaining a military presence in the country.

Tyler Durden Wed, 07/15/2026 - 13:40

Pennsylvania Data Centers Face Increased Oversight Under New Law

By Diana DiGangi of UtilityDive

Pennsylvania's Democratic Governor Josh Shapiro, signed a budget Sunday which will require data centers to report their exact water and power usage annually to the state. It also requires the PJM Interconnection to give Pennsylvania state regulators additional insight into its demand forecasting.

“The current process by which utilities submit information to PJM lacks transparency for policymakers, regulators and stakeholders,” states House Bill 1924, which was folded into Pennsylvania’s 2026-2027 budget. “There is a need for oversight by the Pennsylvania Public Utility Commission to ensure accuracy and transparency of load-forecast inputs.”

Data centers in the state will now be required to compile an annual report containing information such as their “estimated average amount of energy usage per hour during the data center’s peak load,” the provision states.

The provision in the budget also requires data centers to submit total energy consumption for the previous calendar year, an estimate of the projected total energy demand for the following year, and “any measures undertaken to generate electricity on site or off site to reduce carbon emissions or impacts on the electric grid, including the specific energy source, and any potential future measures to generate electricity or other form of energy on site or off site,” it states. 

Data centers that fail to comply with the new reporting requirements will be fined $10,000 per day until their report is submitted, according to the budget.

The state Department of Environmental Protection will publish an annual report on the “aggregate energy consumption and water consumption trends for data centers operating [in the state], including environmental impacts and recommendations to address identified issues.”

Data center development in Pennsylvania has boomed, with utility PPL Electric reporting in May that its “advanced” stage data center pipeline had jumped 12% in three months, from 25.2 GW to 28.3 GW expected by 2034.

The PJM language in the budget will help state agencies “better understand future electricity needs as demand continues to increase,” said state Sen. Gene Yaw, R, who sponsored the original legislation, in a Monday release.

Shapiro was one of the PJM state governors who in September threatened to pull their states out of PJM’s markets unless they were given a role in governing the organization. “If PJM refuses to change, we will be forced to go in a different direction,” he said. “That is not a path that I am eager to chart, but I am not willing to stand idly by and let PJM dictate our future.”

An October memo about the legislation, circulated by Yaw and Sen. Nick Miller, D, said that “the process by which utilities and load-serving entities submit information to PJM is opaque, and policymakers, regulators, and stakeholders lack confidence in the data’s reliability.”

The Pennsylvania PUC “showed one utility is projecting its load to grow over the next 9 years by over 200% while the next closest utility was at 11% over the same period,” the memo said. “Such a wide disparity raises questions about how Pennsylvania utilities are evaluating requests for new service from large customers and relaying that information to PJM.”

The legislation gives the Pennsylvania PUC the authority to “review and validate load forecasts submitted by Pennsylvania utilities to PJM,” “coordinate with PJM and other state regulators to ensure accuracy and prevent duplicative counting of projects and contracts,” and “access all relevant materials necessary to carry out this oversight,” the memo said.

Tyler Durden Wed, 07/15/2026 - 13:00

SpaceX Shares Fall Below $135 IPO Price, But The Real Story Is Its Bonds

SpaceX has slipped below its much-hyped $135 IPO price, and down 40% from the all time high hit during the June 15th gamma squeeze when the stock surged above $220 if ovenright trading, an "inevitable outcome" according to Bloomberg, which lends some validation to the skepticism surrounding "a valuation that always relied more on imagination than observable fundamentals."

Wall Street’s price target estimates spanned from roughly $60 to $800 (from Raymond James), a forecast that was 5x above the IPO price...

... a remarkable range that underscored just how little conviction existed around intrinsic value, and where all the upside is based on the Musk "story.".

As Bloomberg's Brendan Fagan writes, "when analysts cannot even agree within hundreds of billions of dollars on what a company is worth, valuation becomes an exercise in storytelling rather than finance." Not like that should have been a surprise: after all, this was expected from the journey that Tesla shares have been on.

While the recent price action does not settle the debate over SpaceX’s long-term potential, but it does suggest the market is becoming less willing to pay almost any price for that uncertainty.

But while the SPCX stock price is notable, the real story is not in the stock but rather the company's brand new $25BN bonds due 2056, which have been a one-way street lower since breaking for trade on June 24...

... and which now yield a junkbond-esque 7.5%. 

The issue here, no pun intended, is that the rout of particular bond has pushed the Goldman hyperscaler bond basket to a new record wide as we noted earlier... 

Hyperscaler bond basket: another day, another record wide https://t.co/Ge41UpsaL9 pic.twitter.com/nssT8MoTeH

— zerohedge (@zerohedge) July 15, 2026

... and prompted Bloomberg to paraphrase what we said over the weekend, in its "Before the Bell" this morning, writing that "Signs of Hyperscaler credit stress has reached the highest since Goldman Sachs launched the basket in February. The data-center building boom has sparked an explosion of debt funding, with investors not paying enough attention to the terms of their lending."

For those who missed it, here is our article from this weekend "Carnage" In The Hyperscaler Bond Market: Did Goldman Just Pop The AI Debt Bubble, in which we explained that the bond market is almost at capacity, and will barely be able to digest any more bond issuance. Which, in a world where trillions in future capex have to be funded almost entirely by new debt issuance...

The corporate bond market threw a tantrum at "just" $250bn in IG bonds YTD.

So how do we get to $8 trillion... or $4.https://t.co/pA7aONbtiy https://t.co/8PamQYA6FH

— zerohedge (@zerohedge) July 15, 2026

... is suddenly a very big problem.

Tyler Durden Wed, 07/15/2026 - 12:44

Legionnaires' Cases Rise In Manhattan's Upper East Side As Dozens Of Cooling Towers Test Positive

Authored by Kimberley Hayek via The Epoch Times,

New York Health officials have identified dozens of cooling towers in Manhattan’s Upper East Side that tested positive for traces of Legionella bacteria, as Legionnaires’ disease cases reached 63 as of Tuesday. So far, 12 people are currently hospitalized, and 40 have been discharged from the hospital.

The New York City Department of Health and Mental Hygiene published a list this week detailing building cooling towers where initial PCR tests were positive for the bacteria.

Owners must drain, clean, and disinfect those cooling towers immediately. Many have already completed the work, with a few pending, according to numbers published by officials.

The towers with positive PCR results, according to the health department’s July 14 update, include 60 East End Avenue, 100 East End Avenue, 180 East End Avenue, and a long string along Madison, Park, York, and Fifth avenues, plus blocks of East 78th through 95th streets.

A handful still show cleaning pending, including 80 East End Avenue and 90 East End Avenue. The department posted exact addresses and street numbers, down to 300 East 83rd Street, which had an unregistered tower.

Confirmed cases climbed to 18 by July 5, an increase from 10 just days prior. They are clustered in ZIP codes 10028, 10128, and 10075, which are located in Yorkville and Carnegie Hill, as well as a stretch east of Central Park.

No deaths have been reported thus far.

Symptoms for legionnaires’ disease include fever, chills, cough, and muscle aches, and it spreads when people inhale mist from contaminated water, not from person-to-person contact. The symptoms usually appear 2–10 days after exposure, according to the U.S. Centers for Disease Control and Prevention.

The disease is treatable with antibiotics. Nonetheless, approximately 1 in 10 cases can be fatal, especially in older adults, smokers, and those with weakened immune systems or chronic lung disease. Cooling towers on rooftops are often the source of these outbreaks through warm, stagnant water.

Health Commissioner Dr. Alister Martin urged people to be on the lookout for symptoms.

“Any New Yorkers who currently live or work in this area or people who have visited the area since late June and are experiencing flu-like symptoms, such as cough, fever, or difficulty breathing, should contact a health care provider immediately,” the department said in an earlier statement.

“This is not an issue with any building’s plumbing system,” the health department noted.

Legionnaires’ disease is a form of pneumonia caused by Legionella bacteria, which thrive in warm water. It produces flu-like symptoms, and if left untreated, complications can become serious or even fatal.

When multiple cases emerge within a neighborhood—known as a community cluster—the exposure often traces back to sources such as cooling towers, hot tubs, or spray fountains. When cases cluster within a single building instead, the source is usually the building’s plumbing system, particularly its hot water system. In these situations, residents can be exposed to the bacteria through water mist while showering.

Last summer, a cluster in Central Harlem made 114 people sick and killed seven. That one was also connected to cooling towers.

Tyler Durden Wed, 07/15/2026 - 12:40

Alibaba's Qwen AI Will Be Integrated Into Apple Phones In China Amid Push For Local Models

Apple is starting to take cost-cutting (and Chinese supply chains) very seriously.

Just days after reports that the smartphone giant will use China's DRAM pioneer CXMT (which just priced its IPO) for local memory as a cheaper alternative source to ridiculously overpriced DRAM sourced from the memory cartel triad of Samsung, SK Hynix and Micron, this morning Reuters reported that BABA Qwen AI - much cheaper but just as efficient as most US frontier models - will be integrated into Apple Intelligence in China.

US-listed shares in of Alibaba rose 6% on Wednesday after the company confirmed to CNBC that the Qwen AI model will be integrated into Apple systems in China. 

“Qwen will be integrated into Apple Intelligence experiences within iOS, iPadOS, macOS, and visionOS for users in China,” an Alibaba spokesperson told CNBC. 

The Cyberspace Administration of China included Apple AI services on a list of approved providers, which included products from homegrown companies like Huawei.

The decision follows a long route to a Beijing greenlight for Apple’s AI service since the offering was first announced in 2024. In that time, the technological rivalry between the US and China has intensified as both countries race for dominance in AI.

The Apple-Qwen integration gives users the ability to access the model’s capabilities, “like text and image understanding and generation, without needing to jump between tools,” the Alibaba spokesperson added.

It comes after CNBC reported that Apple is in talks with a small Silicon Valley company that says it can shrink powerful artificial intelligence models enough to run directly on an iPhone, the startup’s CEO told CNBC on Tuesday. PrismML, a Khosla Ventures-backed spinout from the California Institute of Technology, publicly released compressed versions of Alibaba’s open-source Qwen model on Tuesday. The company said it reduced the model from roughly 54 GB to less than 4 GB, allowing all 27 billion of its parameters to run on an iPhone 15 or newer.

Meanwhile, in a stealthy push for local (i.e., "on your cell phone") models, earlier this week Bloomberg reported that Apple's planned M7 Ultra chip is being designed to support up to 1.5 TB of unified memory and to push AI performance toward the class of Nvidia's Blackwell accelerators. Why? To give the company's upcoming local LLMs access to as much DRAM as possible so the company is not confined to the cloud.

Apple's M7 Ultra chip coming in 2029 is rumored to support 1.5TB of RAM.

This would make the processor much more capable for on-device AI. pic.twitter.com/7162RWZjpN

— AppleTrack (@appltrack) July 12, 2026

We previously looked at the Chinese LLM scene in two extended articles recently, the first one showing how rapidly China's open models are catching up to the latest frontier offerings in the US (see "Are Chinese AI models a better value than US models")...

... and the second one drilling down into each and every AI model in what we called the "definitive Chinese LLM primer."

Source: Goldman

We also did an extended overview of the Alibaba offering which increasingly appears primed to take on the leading US frontier models; the schematic is summarized below.

Source: Goldman

Much more in the full reports (here and here).

Tyler Durden Wed, 07/15/2026 - 12:20

Standard Nuclear Slashes IPO Size As Nuclear Comps Collapse

Standard Nuclear reset its IPO terms sharply lower as recent nuclear peers have watched their stock price crater after debuting on the public market. 

The TRISO fuel manufacturing company originally targeted 18.25 million shares at $18-$21, for up to $383 million in proceeds and an implied valuation as high as $3.55 billion. It has now filed to sell 10 million shares at $15, raising $150 million with a fully diluted market value around $2.4-2.7 billion.

The adjustment reflects cooling sentiment toward newer nuclear public vehicles. While some established or better-capitalized names have held up, others that listed via SPAC or IPO have had their stock prices obliterated.

Terrestrial Energy (IMSR), which went public in late 2025, trades under $6 after falling more than 70% from its highs. 

Hadron Energy (HDRN), a micro-modular reactor play that listed earlier this year, has dropped roughly 80% from its post-deal peaks and now trades around $2 with a market cap near $140 million.

Standard Nuclear reported just $3 million in revenue for the twelve months ended March 31, 2026, against a net loss of approximately $15 million. At the original top-end valuation of $3.55 billion, that implied a price-to-sales multiple over 1000x. The revised valuation doesn't improve the multiple very much, but it's worth noting that the company at least has revenue compared to some of its other nuclear peers.

The company produces TRISO fuel for advanced reactors and claims the only privately funded industrial-scale line in the US after acquiring assets from the Ultra Safe Nuclear bankruptcy. 

BWXT already manufactures and has delivered TRISO fuel for Department of Defense programs such as Project Pele and continues expanding capacity. 

Newer players include Kairos Power, which uses TRISO in annular pebbles for its fluoride salt-cooled design and is collaborating with BWXT on commercial production scaling, and X-Energy with its TRISO-X fuel for the Xe-100.

Markets are applying greater scrutiny to nuclear valuation and timelines even as long-term demand tailwinds from AI power needs remain intact. Capital is clearly no longer flowing indiscriminately to every nuclear story that reaches the public tape.
 

Tyler Durden Wed, 07/15/2026 - 12:00

Trump Says FBI Wasting Time If It Probes Conspiracy Theories About Graham's Death

Authored by Aldgra Fredly via The Epoch Times,

President Donald Trump said on July 14 that he was aware of the conspiracy theories surrounding Sen. Lindsey Graham’s (R-S.C) sudden death but said that any FBI investigation into them would be a waste of time.

Trump was responding to a reporter’s question at the Oval Office about why FBI agents were at the senator’s residence and whether there were any updates on the possible probe into his death.

“Well, I don’t know why because I think he had a problem. His father had a very similar problem, as you know. It’s very unique,” the president said, referring to Graham’s health issues.

“I don’t see a lot of evil there. I know there’s all sorts of conspiracy theories going on and I think the FBI is wasting their time if they’re doing that.”

Graham passed away on July 11 after what his office described as a “brief and sudden illness.”

Preliminary findings by the medical examiner suggest that Graham died from an aortic dissection due to arteriosclerotic cardiovascular disease, which is considered an aorta rupture stemming from hardening of his arteries, according to his office.

Trump said that Graham’s condition was difficult to detect, although he noted that the late senator had previously complained about having a “bad back.”

“I wish he took better care of himself,” the president told reporters.

“What happened is actually something that’s very hard to detect. It was not related to any blockage. It was a totally different thing.

“I’ve watched all the medical reports. I’ve had the doctors from the White House come in and explain what happened. And this is something that is very, almost undetectable. And if it happens, there’s not much you can do about it.”

Trump: 'A part of Lindsey's body literally BLEW up' pic.twitter.com/5uwHasvYWQ

— RT (@RT_com) July 14, 2026

The Epoch Times reached out to the FBI for comment but did not receive a response by publication time.

FBI Director Kash Patel speaks during a press conference in Washington on April 27, 2026. Madalina Kilroy/The Epoch Times

FBI Director Kash Patel said in a July 12 post on X that the FBI was “assisting local authorities and has made every necessary resource available,” but did not elaborate.

Graham had just returned from a trip to Kyiv, Ukraine, where he announced on July 10 that he and other senators had reached ​an agreement with the Trump administration to move forward with updated legislation on Russia sanctions.

The legislation, which Graham had been ​working on with fellow Republicans and Democrats for months, would impose sanctions on countries doing business with Russia, including buyers of its ‌energy exports.

Graham, who met with Ukrainian President Volodymyr Zelenskiy in Kyiv on the same day, said the ​agreement meant the legislation could move forward, giving Trump fresh tools to help end the Ukraine–Russia war, which is now in its fifth year.

“We’ve reached an agreement with the White House on a version of the Russian sanctions bill that they will support. It means it’s ​going to become law,” he told reporters, wrapping up his 10th visit to Kyiv.

Following Graham’s passing, South Carolina Gov. Henry McMaster announced on July 13 that he had appointed Graham’s sister, Darline Graham Nordone, to serve the remainder of the late senator’s term, which is set to expire in January 2027.

Tyler Durden Wed, 07/15/2026 - 11:40

Wisconsin Panel Finds Elon Musk Likely Broke The Law With $1 Million Voter Checks

Authored by Kimberley Hayek via The Epoch Times,

A bipartisan Wisconsin elections panel has determined there is probable cause that Elon Musk broke state law by offering two $1 million checks to voters during last year’s hotly contested Supreme Court race.

The Wisconsin Elections Commission voted 5-1 last week to file two complaints against the billionaire with Brown County District Attorney David Lasee. Prosecutors have 40 days to decide whether to file criminal charges under the state’s election bribery statute. That law blocks offering anything of value to entice someone to vote.

The complaints arose from Musk’s actions in the days before the April 1, 2025, election. He posted on X promising $1 million prizes and gave out two oversized checks at a Green Bay rally to supporters who signed a petition against “activist judges.” The recipients were Nicholas Jacobs and Ekaterina Diestler.

The commission said Musk’s social media promise and the public giveaway were meant to induce individuals to vote in that Supreme Court contest. Musk donated and backed groups in the race to help conservative candidate Brad Schimel flip the court’s liberal majority.

Musk’s spokespeople did not immediately return a request for comment.

Democrat-backed Susan Crawford defeated Schimel by approximately 10 percentage points. The loss came despite Musk-connected efforts spending tens of millions. Total spending in the race broke records, surpassing $100 million and rendering it the most expensive judicial contest in American history.

On March 30, 2025, Musk hosted a town hall in Green Bay, donning a cheesehead hat, and made a show of awarding the prizes. He told the crowd the race could impact the future of the state, the House of Representatives, and even “Western civilization.”

“The Wisconsin Supreme Court is able to redraw the districts,” he said at the event.

“They will gerrymander the district and deprive Wisconsin of two seats on the Republican side.”

Wisconsin Attorney General Josh Kaul, a Democrat, tried to prevent the payouts. He filed emergency lawsuits arguing they violated laws against using money to influence votes. Lower courts turned him down. The state Supreme Court itself, with its liberal majority, refused to hear the last-minute appeal without explanation.

Kaul’s office had said it was committed to “safe, secure, free and fair” elections. But the payments were made anyway.

Crawford’s victory maintained the 4-3 liberal sway on the court. Conservatives had hoped a new majority could help redraw congressional maps and bolster Republican influence in Washington. 

Musk later signaled he'd slow down political spending, and his side framed the checks as rewards for petition signers and publicity, not direct vote-buying. Similar complaints were lodged around Musk’s $100 offers for petition signatures in other states.

Tyler Durden Wed, 07/15/2026 - 11:05

WTI Dips As US Crude Production Hits Record High, SPR Draw Slows, Cushing Remains At 'Tank Bottoms'

Oil prices are marginally higher overnight after President Trump reinstated the blockade on Iranian ports in the Strait of Hormuz and shipping slowed to a crawl amid the renewed warfare in the critical waterway.

US Central Command said it completed a morning round of strikes on Iran that further degraded its ability to attack commercial shipping in Hormuz.

It comes a day after attacks on ships that had been participating in so-called shuttle runs that have helped get oil from inside the Persian Gulf through the strait.

Visible transit through the waterway has fallen sharply in recent days, but there remains a high level of uncertainty about what’s actually crossing because many ships have been doing so dark - without broadcasting their location.

“While crude has started to find some balance after rallying from around $70, it still takes a brave shipowner to transit the Strait of Hormuz with the threat of attacks from forces aligned with Tehran remaining very real,” said Chris Weston, head of research at Pepperstone Group Ltd.

“The broader geopolitical backdrop continues to deteriorate, providing ongoing support for crude prices and keeping buyers prepared to step back in should prices push toward the $90 area.”

Overnight saw mixed data from API on crude/product supply, all eyes now on the official data.

API

• Crude -564k

• Cushing +200k

• Gasoline -1.664mm

• Distillates +2.3mm

DOE

• Crude -1.69mm (-900k exp)

• Cushing +430k

• Gasoline -1.53mm

• Distillates +4.56mm - biggest build since Jan 2026

After a build the prior week, crude stocks resumed their series of drawdowns last week (11 of last 12 weeks) and gasoline stocks also saw another draw while distillate stocks soared (amid record 3-2-1 crack spreads)...

Crack spreads remain at record highs...

The SPR saw yet another drawdown... but the smallest since the war-driven releases began (-2.985mm)...

Cushing stocks barely moved off 'tank bottoms'...

US crude production pushed back up to record highs as the rig count trends higher...

Interestingly, after reaching record highs in the prior week, US crude product exports plunged to pre-war norms last week (but bear in mind this data series is a week lagged)...

The rebound in crude... and more notably products... has started to drag pump prices higher in the US...

Not what President trump wants to see.

But oil prices are dipping after the report...

Finally, as The FT reports, oil traders are warning that the latest flare-up of tensions in the Strait of Hormuz marks a risky new phase for the market, which is facing fresh disruption without the stockpiles that helped avert a wider economic crisis earlier in the US-Iran war.

“We’ve burned through all of the buffers we had. Everything,” said one trader.

“All of that’s now gone,” he said.

Western powers released record volumes of strategic oil reserves, China cut its oil imports in half and made its state-backed companies pull fuel from inventories, while the White House even let it be known the US could, in theory at least, intervene in futures markets if prices got out of hand.

The result was that Brent crude peaked at $126 a barrel in April, well below its all-time high, despite the IEA warning that the world was experiencing the worst supply disruption in history.

But traders said that if the renewed closure of the strait lasts for months, with some suspecting Iran wants to keep the pressure on US President Donald Trump ahead of the November midterm elections, it is not clear this time where the oil to make up the shortfall would come from.

Tyler Durden Wed, 07/15/2026 - 10:40

"Going To Rock A Lot Of Things": Pentair Crashes After Guidance Cut And CFO Exit As Pool Boom Fades

Pentair shares crashed in early U.S. cash trading after the swimming pool equipment and water treatment systems company slashed its 2026 outlook. Preliminary second-quarter results also missed estimates, while the sudden departure of its CFO raises questions about the company's trajectory and whether the Covid-era pool boom has finally run its course.

Pentair now expects full-year adjusted earnings of $4.60 to $4.80 per share, down from prior estimates of $5.30 to $5.40, and well below the Bloomberg consensus estimate of $5.33.

Preliminary second quarter sales were about $930 million, while adjusted earnings of roughly $1.12 per share missed the $1.47 consensus.

Goldman analysts told clients earlier:

Watching PNR down 18% pre-market – big guide down last night + CFO resigning. This is going to rock a lot of things consumer today – PNR sells equipment into the pool end market. POOL HAYW are the other names people will sell. But broad negative read.

The Covid-era pool boom boosted Pentair's revenues beginning in the second half of 2020, and quarterly revenues have since flatlined around $1 billion.

Here's what other Wall Street analysts are saying (courtesy of Bloomberg):

RBC Capital Markets (sector perform from outperform)

• Analyst Deane Dray downgrades to sector perform after a "negative preannouncement, full year guidance cut, and surprise CFO departure after just four months in the role"
• Says Pool channel destocking is "clearly proving far worse" than previously communicated by management; says lack of visibility of recovery makes it a "show-me story for now"

TD Cowen (sell)

• Analyst Joe Giordano sees a "significant" miss and that "magnitude of the reset highlights questions around market share dynamics and underlying market health into 2027"
• Says announcement suggests "more extreme" underperformance, "sizeable" change in market dynamics, or combination of both

Citi (buy)

• Analyst Andrew Kaplowitz says quarterly revenue miss was "meaningful," flagging company commentary that Pool channel inventory weighed on results
• Say that even with leadership and business changes "we acknowledge that remaining 3Q destocking actions and investor concern around PNR's Pool market share could keep shares pressured in the near-term"

It remains unclear how or when Pentair's pool business will recover. Perhaps lower interest rates and another pandemic-driven home improvement boom are what it will take to revive demand.

Tyler Durden Wed, 07/15/2026 - 10:35

We Have The Tools/Tolls To Do It

By Michael Every of Rabobank

Markets were delighted by US CPI data. Against a backdrop of oil up nearly double digits they instead got a number closer to a future trimmed mean measure without that nasty volatility, even if it was a fall in gasoline prices that resulted in the -0.4% m-o-m headline and 0.0% core prints.

Warsh modelled the New Model Army he wants to see central bankers being: he refused to say ‘mission accomplished’ on inflation: “We have the tools to do it” is perhaps being the new “Whatever it takes.” However, he didn’t want to talk about what he thought on rates: markets had to do that themselves, and they took CPI to mean less Fed tightening.

The Middle East’s new models of arms will get a big say on that. In Hormuz, the US naval blockade of Iranian ports is now back in effect, with enforcement of sanctions, and the two sides are trading blows across the strait, if not the deadliest they are capable of. Yet President Trump is again threatening to hit Iranian power plants and bridges next week if no deal is reached; Axios reports that Trump just held a Situation Room meeting on massive new strikes that are wide enough in scope to force Tehran to back off in Hormuz; the Houthis might threaten the Red Sea after announcing Saudi airspace is not safe for overflight; and Israeli PM Netanyahu warned Iran if his country is attacked, the response will be a “decisive blow.”

There are more positive signs too. Israel-Lebanon talks continue in Rome, along with a surprise Trump press conference call for Israel to withdraw from Lebanon and Syria that is unlikely to mean much on the ground. Trump also just hosted Iraq’s PM for talks on a final US troop withdrawal set for end-September, Iran, and oil - where the US is supporting efforts to revive an Iraq-Syria crude oil pipeline as another Hormuz workaround.

Trump also dropped his 20% Hormuz toll in favor of GCC FDI pledges into the US. Take Trump seriously (the US is not going to fight for free) not literally (the toll was impractical short of a full state-press vs the private sector); and will those who fight alongside the US see their FDI contribution commensurately lower? A more obvious carrot and stick is the Wall Street Journal underlining the UAE was rewarded with coveted US AI chips for supporting the war.

At a more meta level than the Financial Times -- opining Trump has no clear path to victory vs. Iran -- sees, stop to Hor-muse over this idea for a moment too:

1. The US national security strategy openly calls for control of maritime chokepoints.
2. That must include Hormuz and its energy flows.
3. That’s very expensive --and hard-- to achieve and maintain.
4. Yet someone else controlling Hormuz is even more expensive, geostrategically.
5. So, if the US starts a war to control Hormuz but can’t, even if it gains during fighting as an LNG and helium exporter, why not then ensure the strait is not a chokepoint?
6. How better to achieve that than to ensure Hormuz remains in on-off chaos long enough that friends’ pipelines and new oil supply eventually reduce it to more of a sideshow?
7. Seen that way, though the US went into this war wanting ‘Venezuela 2.0’, within limits, it has rolling optionality on other outcomes that suit its geostrategy - and it “has the tolls to do it.”

Brent is still stable at $85-86, in line with our energy analyst Joe Delaura’s expectations, following the aggressive short squeeze just seen. For more from him, and Florence Schmit on LNG, see here.

There is also more recognition of the incredible success of Ukrainian drone strikes on Russia’s Sea of Azov fleet, which Moscow is calling terrorism. Imagine that transplanted elsewhere…

Meanwhile, President Macron used Bastille Day to showcase Europe's defense ambitions and will allow Ukraine to build French defense systems there; but the head of Germany’s Luftwaffe warned Europe has “no time” to counter Putin without US weapons. Somebody who should know thinks that Europe doesn’t have the tools to do it.

US Under Secretary of War Colby had a blunt social media message in a related regard, not just for Europe, but for Australia and Canada, among others: “There is a great deal of hubbub about a collective “middle powers” strategy these days. At the Department of War, we are not concerned that this is a serious possibility. Rather, we are more concerned that a few allies and partners will *think it is* and waste valuable time, money, and political capital on a distraction.”

Just before that, UK Chancellor Reeves gave an annual Mansion House speech which sounded like an interview to keep her job under PM Burnham by focusing on devolution, postcodes, “economic security is national security,” “securonomics,” and “industrial strategy.” Yet she didn’t mention tariffs as the tools to do it when statecraft logic, which she implies is being embraced, says this cannot happen without them. Then again, Reeves also sounded like she would like to rejoin the EU if possible, so that tariff decision hypothetically wouldn’t be any UK government’s to make anyway.

For its part, Europe will look at yesterday’s China-EU trade data, with the Chinese surplus surging yet again, and the report that China is targeting strategic sectors in the Netherlands as Dutch technology and companies offer Beijing outsize influence over value chains, and thinking about what it needs to do re: trade come October.

Likewise, Chinese Q2 GDP today was 4.3% y-o-y, lower than the 4.5% consensus, but 0.9% q-o-q expectations, and the y-o-y year-to-date (YTD) figure was 4.7% vs. 4.8%. Within that, retail sales for June were 1.0% y-o-y and 1.3% y-o-y YTD, while industrial production was 5.3% y-o-y vs. 4.6% consensus and 5.4% y-o-y YTD. Fixed asset investment was -5.7% y-o-y YTD, worse than -5.0% expected. In short, consumers are spending little, investment is declining (with property investment -18% y-o-y YTD and new house prices -0.3% m-o-m), yet industry is booming: that either means stockpiles are building or exports are flooding the world.

It’s the latter, clearly, as China’s economic statecraft has the tools to do it: for example, it now not only makes the tools Germany used to, but the tool-making machines it used to. Now let’s all say “securonomics” or “strategic autonomy” again and see what happens next.

Aside from tools and tolls, markets can also note that China just increased its holdings of US Treasuries, as Japan’s Finance Ministry is floating JGBs in tax-free accounts amid a GPIF portfolio review to incentivise its vast funds to keep more cash at home not abroad. What if (or when) other major economies follow suit to try to deal with the vast bills looming for a true “securonomics”?

In the meantime, enjoy headlines such as ‘Wall Street Traders Seize on Fervour and Fear to Set Records’ and ‘IBM Acting Like a Penny Stock Is a Sign of Times’ on your Bloomberg screen.

Tyler Durden Wed, 07/15/2026 - 10:00

Why Central Banks Love A Gold Sell-Off

Via SchiffSovereign.com,

On July 7, Bloomberg published an article with the headline: “Gold’s Bull Market Has Ended and Now All Eyes Are on Bears,” explaining how many retail investors have headed for the exits.

That same day, the People’s Bank of China, the country’s central bank, reported its largest monthly gold purchase since 2023.

Of course, June marked its twentieth consecutive month of adding gold to its reserves. Central banks are relatively price insensitive. They buy gold as a long term hedge to preserve value, not to trade back for more paper.

But they aren’t stupid either, and this shows they are buying the dip.

Gold peaked at $5,589 per ounce on January 28 and trades around $4,000 today, roughly 28% below the high. The second quarter was gold’s worst since 2013. Investors have pulled about $18 billion out of gold ETFs since the peak, much of it late money that piled in during last year’s frenzy and bolted the moment momentum broke.

But the price is not the story. The story is what central banks are doing.

Central banks have been the dominant force in gold since 2022, when Russia invaded Ukraine, the US froze $300 billion of Russia’s central bank reserves, and every finance ministry on earth learned that dollar assets were not the safe havens they’d believed.

In 2024, central banks bought 1,090 tons of gold, close to an all-time record.

That massive demand made gold expensive. The price nearly doubled from its 2025 low, and central bank buying slowed to 863 tons. That was still higher than historical averages, but down 21% from the year before.

The slowdown was not fading interest; it was price discipline. Central banks are not traders chasing momentum. They are savers accumulating a reserve asset, and like any sensible saver, they buy less when the thing they are saving in gets expensive.

And they speed back up when it goes on sale. In the first quarter of this year central banks bought 244 tons, more than the previous quarter and above the five-year average. China alone has added about 40 tons in the first six months of 2026, compared to just 27 tons in all of 2025. The People’s Bank of China bought more gold last month, with the price down nearly 30% from its high, than in any single month of the entire run-up.

The reason is simple: nothing has changed about why they buy.

The World Gold Council, the industry group that tracks official gold demand, surveyed 76 central banks this year. Seventy-four percent said they expect the dollar’s share of global reserves to be lower five years from now.

These are the institutions that actually hold the world’s reserves, and they are telling you, on the record, that they plan to keep moving away from the dollar.

None of their reasons went away when the price fell. The US national debt keeps growing by trillions, Congress has no plan beyond borrowing more, and Washington keeps proving it will continue to weaponize the dollar.

A central bank holding dollars is holding the liability of a government that is both overextended and unpredictable. Gold sitting in its own vault carries neither risk.

That calculus was true at $5,589, and it is just as true at $4,000.

A trader who is down 28% has a problem if they are trying to quickly turn a profit, and accumulate more paper dollars.

But a saver who plans to accumulate gold for the next decade just got a better price. That is why the sell-off did not scare away the biggest buyers in the market.

It may be exactly what they were waiting for.

We made this argument to our subscribers of our investment research newsletter, Strategic Assets, in January.

With gold near its all-time high, we said that this was no longer the early stage of a bull market, that a major drawdown was a real possibility, and that it was time to take some profits.

In fact, subscribers who took action on our research locked in gains of more than 950% on a small silver producer and 540% on a gold and silver producer, both in under a year.

Now the sell-off has come for the miners too. Even solid, debt-free producers are trading as much as 50% below their highs from earlier this year.

But again, as nothing had changed about the long term gold thesis, little has changed about the profitability of these companies. They are still wildly profitable at $4,000 gold, which is far above projections they had planned for.

Some of these companies are still pulling gold out of the ground at a cost of just $1,000 an ounce, which is an amazing margin.

So we are starting to buy again.

It is the same discipline the central banks just demonstrated: slow down when the asset is expensive, step up when it gets cheap, and never confuse a price correction with a change in the story.

Nobody knows where gold trades next month. But the biggest buyers on earth just showed you what they do when gold gets cheaper. They buy more.

Tyler Durden Wed, 07/15/2026 - 09:20

Man Fleeing ICE Agents Struck, Killed By Semi-Truck In Florida

Authored by Kimberley Hayek via The Epoch Times,

A 28-year-old man died early on July 14 after he ran into the path of a tractor-trailer on State Road 16 in St. Augustine, Florida, moments after running from federal immigration agents at a nearby gas station.

Florida Highway Patrol Master Sgt. Dylan Bryan said the sequence of events started in the parking lot of a convenience store just before 7 a.m.

Homeland Security Investigations and U.S. Immigration and Customs Enforcement (ICE) agents were at the scene when four people ran off.

One of them ran across the road straight into oncoming traffic when he was hit by a semi-truck.

He was pronounced dead at the scene. The truck driver was uninjured.

State troopers are handling the investigation. The man’s name hasn’t been released.

Authorities have not shared much information about the four people who tried to flee on Tuesday morning or exactly why agents contacted them in the first place.

ICE and the Department of Homeland Security (DHS) did not immediately reply to a request for comment.

It was the third death in a week during ICE incidents, following fatal shootings in Texas and Maine.

In Texas, an ICE officer fatally shot an illegal immigrant from Mexico during a targeted enforcement operation in Houston after the man used his vehicle to try to run over an agent.

In Maine, an illegal immigrant with a final order of removal was fatally shot by an ICE officer in Biddeford after he attempted to flee in his vehicle during a traffic stop.

A day later, border czar Tom Homan told Fox News on Tuesday that ICE is temporarily suspending most vehicle stops nationwide.

“It’s not a policy change. It’s a temporary pause,” Homan said.

“ICE leadership along with DHS believes they want to look at these last couple incidents and look: Is there something that could have been done better? Is there any training that can be improved? Or is it simply ICE doing a job, and bad things happen when people don’t comply with law enforcement officers?”

Homan stressed that the pause on most vehicle stops will not reduce the frequency of arrests ICE agents make of illegal immigrants. Officers can still apprehend individuals as they exit their homes before getting into a vehicle, or after they arrive at their destination, the border czar said. He cited a surge in vehicle assaults on federal agents since President Donald Trump returned to the White House as the reason for the change.

“If we can arrest that alien outside that vehicle and take that two-ton weapon away from them, that’s good in some instances,” Homan said. “Other instances, we’re still going to need to do vehicle stops for a significant criminal.”

Tyler Durden Wed, 07/15/2026 - 08:45

July Rate-Hike Off The Table After Producer Price Inflation Drops Most Since COVID

Following yesterday's much cooler than expected, Goldman's Rich Privorotsky notes that today’s PPI print matters more for the core PCE read-through (Fed's favorite inflation indicator), particularly healthcare and financial services.

While May's headline PPI print was hot, core was cooler than expected, and June's data release today was expected to show no change in headline producer prices.

In fact, like with CPI, headline Producer prices actually saw deflation (-0.3% MoM), equaling the biggest monthly decline since April 2020. The annual pace of producer price gains slowed to 5.5% (well below the 6.2% expected) and May's big jump was revised notably lower also...

While Services remain with modest inflation, Goods are in significant deflation now...

Core PPI (ex Food and Energy) printed +0.2% MoM, cooler than the +0.3% MoM expected, and May's rise was revised notably lower leaving Core prices up 4.7% YoY (vs +54.1% YoY exp)...

Energy was the biggest driver of the headline deflation, but Food and Transportation also saw MoM price declines...

PPI MoM dropped -0.3%, below est of 0.0%, and down from a 0.6% increase in May (revised from +1.1%). PPI rose 5.5% for the 12 months ended in June. Core PPI rose 0.1% MoM in June, a drop from the 0.8% in May; On a YoY basis, core PPI rose 5.5%, a drop from 6.0% in May.

The June PPI decline can be attributed to prices for final demand goods, which fell 1.4%. In contrast, the index for final demand services moved up 0.2%.

Final demand goods: The index for final demand goods moved down 1.4%R in June, the largest decrease since falling 1.9% in July 2022. Leading the decline in June, prices for final demand energy dropped 6.4 percent. The index for final demand foods moved down 0.6 percent. Conversely, prices for final demand goods less foods and energy increased 0.2 percent.

• Product detail: Nearly two-thirds of the June decline in the index for final demand goods can be traced to prices for gasoline, which dropped 12.0 percent. The indexes for diesel fuel, jet fuel, fresh vegetables (except potatoes), crude petroleum, and thermoplastic resins and materials also fell. In contrast, prices for plastic products advanced 1.6 percent. The indexes for residential electric power and for potatoes also increased.

Final demand services: The index for final demand services rose 0.2% in June after falling 0.1% in May. Over 60 percent of the advance can be attributed to margins for final demand trade services, which moved up 0.4 percent. (Trade indexes measure changes in margins received by wholesalers and retailers.) Prices for final demand services less trade, transportation, and warehousing increased 0.1%. Conversely, the index for final demand transportation and warehousing services declined 0.1%.

• Product detail: Half of the June increase in the index for final demand services can be traced to margins for fuels and lubricants retailing, which jumped 13.0 percent. The indexes for securities brokerage, dealing, and investment advice; furniture retailing; apparel, jewelry, footwear, and accessories retailing; loan services (partial); and inpatient care also rose. In contrast, margins for machinery and vehicle wholesaling declined 8.4 percent. The indexes for food and alcohol wholesaling and for deposit services (partial) also fell.

And it appears, like with CPI, that Energy's impact on inflation has peaked with prices...

Services did pick up from May's deflation...

Additionally, according to the data, Memory prices also dipped...

Following this print's confirmation of easing inflation angst, July is effectively off the table (technically 9% chance still priced), while September remains live (45%)...

Unless core inflation reaccelerates, Goldman's Privorotsky says rate pricing should remain close to current levels.

Tyler Durden Wed, 07/15/2026 - 08:38

Futures Rise After Blowout ASML Earnings Boost Tech Sentiment

Futures are higher led by technology stocks, after solid earnings from ASML offered fresh evidence of the relentless demand for chips enabling the global AI buildout and boosted sentiment across the AI Infra trade. As of 8:00am ET, S&P futures are up 0.1% and Nasdaq futures rise 0.4%, both off session highs. In Tech, focus is on ASML +4%  on guidance raise (US Semicap Equipment peers +2-4% in sympathy),  PYPL +20% on reports of a Stripe/Advent takeover offer;  AAPL +0.50% and BABA +4% on China approval of Alibaba “Qwen AI” integration into the iPhone experience; and NVDA flat on Jensen commentary that Vera Rubin chips were on track for deliver to customers (countering delay talk).  On the US/Iran front, the US carried out another round of strikes near the Strait of Hormuz overnight and President Trump said the US may hit power plants and bridges next week unless Iran returns to negotiations and makes a deal (also have report from Axios that Trump held a meeting in the situation room yesterday to discuss a new offensive). According to JPM, the tech complex is also getting a boost thanks to stabilization in Korea, with KOSPI adding 6% overnight (JPM APAC says that foreign & institutional demand is stepping into Korea as domestic retail investors are selling). Asia finished mixed (Shanghai -29bps / Hang Seng +1.4% / Nikkei +1.49% / Kospi +6.3%) as the day to day volatility continued in Korea (Hynix +4%, which appeared to be a “catch up” to SKHY post its +27% move in the US session). Bond yields edged higher in the US and Europe, with the yield on 10-year Treasuries up one basis point to 4.60%. The dollar wavered. While money markets have mostly priced out the possibility of a Federal Reserve hike later this month, expectations for a move in September remained high. Commodities are seeing a bid with gold the notable laggard. Brent crude futures rise 0.5% to just above $85 a barrel while European natural gas futures rise 3% to the highest since March. The Bloomberg Dollar Spot Index is near flat. Today’s macro data focus in on PPI and then macro read-through from names in Fins and Transports.  

In premarket trading, Mag 7stocks are mostly higher (Apple +0.6%, Amazon +0.3%, Microsoft +0.3%, Tesla +0.2%, Meta Platforms +0.2%, Alphabet -0.5%, Nvidia -0.2%)

• ASML Holding NV ADRs (ASML) gain 3% after the company lifted its annual sales forecast for the second time this year and laid out plans to increase production as a surge in artificial intelligence spending drives demand for the Dutch company’s chip-making machines.
• BlackRock (BLK) gains 4% after pulling in $192 billion of net client cash in the second quarter, with investors pouring money into exchange-traded funds and pushing total assets above $15 trillion for the first time.
• Elevance Health (ELV) falls 7% after boosting its profit guidance by less than Wall Street had hoped, as the company grapples with recent federal policy changes that have made healthcare more expensive. Peer health insurers are also lower, with Humana (HUM) down 1.6% and Centene (CNC) falling 4%.
• Lionsgate Studios (LION) climbs 7% after Reuters reported that the company is exploring a sale and has attracted takeover interest from Bollore Group. Reuters cited three unidentified people familiar with the matter.
• PayPal (PYPL) jumps 20% after Reuters reported Stripe and private equity company Advent ​International have made a joint offer to ‌buy PayPal for $60.50 per share, valuing the payments firm at more than $53 billion.
• Pentair (PNR) tumbles 22% after the water treatment company cut its adjusted earnings per share guidance for the full year. The company also said it appointed Robert Fishman as interim CFO after Nicholas Brazis resigned on July 10 to pursue another opportunity at a private company.
• Phoenix Education (PXED) drops 10% after the online education company trimmed its net revenue guidance for the full year.
• SK Hynix ADRs (SKHY) fall 6%.
• SpaceX (SPCX) is up 0.7% after closing on Tuesday just $1 above the IPO price.

In other corporate news Nokia says it developed the first commercial AI-driven radio access network (RAN) platform together with Nvidia to radically increase the amount of data operators can transmit using existing infrastructure. Apollo landed the biggest private credit deal on record, offering Broadcom $35 billion of debt, in the latest sign that the buyout shop-turned-blue chip lender is muscling in on the turf of Wall Street. OpenAI’s much-anticipated push into consumer devices is slated to begin with a mobile, screen-free smart speaker designed to be a new type of home computer for the AI era. Lionsgate Studios is exploring a sale and has attracted takeover interest from Bollore Group, Reuters reports.

Tech sentiment was boosted by blowout results from European chip giant ASML and a rebound in Korean stocks. Coming into ASML’s results, analysts set the bar high, expecting an upgrade to full-year net sales guidance. Europe’s most valuable company delivered, but clarity is needed on its conference call as to whether the chip equipment leader can meet the required capacity in the face of soaring AI-fueled demand. 

And speaking of lack of capacity, overnight we reported that the biggest US power grid failed for a third straight time to secure enough future supply commitments to ensure reliability in coming years amid a boom in data center demand. Power-hungry data centers have increased supply costs for the largest US electric grid by more than 60%, the system watchdog said. 

Oil prices rose for a third straight day after the US military launched a fresh wave of strikes against Iran, with Brent advancing 1.1% to around $85.60 a barrel. Overnight President Trump said the US may hit power plants and bridges next week unless Iran returns to negotiations and makes a deal (also have report from Axios that Trump held a meeting in the situation room yesterday to discuss a new offensive). 

Despite the uncertainty created by the standoff, investors say crude prices remain well off their highs above $100 a barrel from earlier in the conflict. Instead, traders are looking at whether earnings can justify high valuations, with early results this season looking promising. “Investors are aware that the road toward peace could never have been expected to be a straight line,” said Stephan Kemper, chief investment strategist at BNP Paribas Wealth Management. “As such, company fundamentals matter more than ever.” 

Bullish AI momentum is not without risks. Repeating what we said over the weekend, Bloomberg writes that signs of Hyperscaler credit stress has reached the highest since Goldman Sachs launched the basket in February.

Hyperscaler bond basket: another day, another record wide https://t.co/Ge41UpsaL9 pic.twitter.com/nssT8MoTeH

— zerohedge (@zerohedge) July 15, 2026

The data-center building boom has sparked an explosion of debt funding, with investors not paying enough attention to the terms of their lending, Bloomberg also noted. 

The threat posed by oil prices will remain in focus with the release of June’s producer price print. Inflation data on Tuesday delivered a strong downside surprise, prompting traders to dial down their expectations for near-term interest-rate hikes.

Fed Chair Kevin Warsh will testify in the Senate on Wednesday, with New York Fed President John Williams and Governor Lisa Cook scheduled to speak at separate engagements. 

“Any hint toward the CPI print being an outlier could revive rate hike concerns,” Kempner said. “This would be even more true if other Fed officials start to echo yesterday’s comments from the Fed Chair about the mission being ‘not yet’ accomplished.”

In politics, acting Attorney General Todd Blanche is set to appear Wednesday before the US Senate in support of his nomination to lead the Justice Department — just days after a federal judge in Miami issued harsh criticism of his actions in the job. Over in Europe, Marine Le Pen’s revived bid for the French presidency is giving investors like Vanguard and Natixis another reason to avoid the country’s government bonds.

In Europe, the Stoxx 600 is little changed thanks to ASML whose shares rise ~5% after the firm lifted its annual sales forecast for the second time this year and laid out plans to increase production. Gains in luxury names are also helping to offset losses elsewhere after Richemont sales expanded nearly twice as much as expected. Here are the biggest movers:

• European fintech stocks gain after Reuters reported that Stripe and private equity company Advent are offering to buy PayPal at a valuation of more than $53 billion
• Richemont surges as much as 7.4% to an all-time high after the Swiss jeweler reported first-quarter sales growth that was nearly twice as strong as expected
• ASML shares rise as much as 7.9% after the chip equipment firm raised FY guidance for this year and set capacity expansion goals for the next two years
• ICG shares rise as much as 3.4%, trimming year-to-date declines, after the alternative asset manager reported first-quarter assets under management slightly ahead of estimates
• Barratt Redrow shares rise as much as 6% after the UK homebuilder said it will return £400 million to shareholders this year. Sector peers are also finding support from Barratt’s FY update
• Camurus shares jump as much as 16%, the most since November, after the Swedish biopharmaceutical firm reported better-than-expected revenue and profit for the second quarter
• Rio Tinto falls as much as 2.3% in London, the most in a week, after the miner reported 2Q copper production that declined from the previous comparable period
• Elis shares slide as much as 4% to €24.64 after holder Canada Pension Plan Investment Board sold about 19.3 million shares for €24.60 apiece
• AFRY shares fall as much as 12%, hitting a 2014 low, after the Swedish engineer’s earnings fell short of expectations in the second quarter, according to analysts at Jefferies
• Handelsbanken shares decline as much as 6.2% after the lender reported net interest income for the second quarter that missed estimates while analysts also note weak lending growth in Sweden
• Premier Group falls as much as 7.3% in Johannesburg, the most since April 2025, after stockholder CapitalWorks sold shares in the packaged foods company at a discount

Asian stocks climbed the most in almost two weeks after a softer US inflation print relieved concerns over imminent rate hikes, while South Korea led advances in technology shares. The MSCI Asia Pacific Index gained 1.9%, the most since July 3. Leading contributor SK Hynix soared 9% in Seoul, tracking a surge in its American depositary receipts Tuesday, while chipmakers Samsung and TSMC also climbed after gains in US tech shares. South Korea’s benchmark Kospi jumped 6.2%, while Taiwan’s Taiex climbed the most in two weeks. Mainland China stocks edged lower after data showed the economy slowed more than expected last quarter, to the weakest in more than three years.  With earnings seasons starting, Asian software and IT services stocks followed global peers lower after IBM missed earnings expectations. Meanwhile, the Hang Seng China Enterprises Index rose the most in a week, as internet firms such as Tencent and Alibaba gained.

 “Softer-than-expected US inflation data has reduced the risk of a more aggressive Fed tightening cycle, which had become a more prominent concern over the past week as renewed US-Iran tensions pushed oil prices higher,” said Rajeev De Mello, global macro portfolio manager at GAMA Asset Management. “Investors have also absorbed last week’s SK Hynix equity issuance, allowing the Korean semiconductor sector to rebound, while the US earnings season has opened on a constructive note.”

In FX, the Bloomberg Dollar Spot Index is near flat. The Norwegian krone slipped to the bottom of the G-10 FX pile, falling 0.4% against the greenback after Norway’s core inflation surprised to the downside.

In rates, treasuries are cheaper by 1bp to 2bp across the curve, unwinding a portion of gains seen Tuesday following a soft CPI print. Treasury curve slightly flatter on the day with front-end leading losses, where 2-year yields trade around 4.215% and cheaper by 2bp on the day. US 10-year yields trade around 4.605% with bunds and gilts both trading slightly cheaper in the sector. IG dollar issuance slate includes a couple of deals. Goldman Sachs was one of three issuers Tuesday, selling a combined $13.9 billion of bonds. They paid an average of about 2.3 basis points in new issue concessions on deals that were 2.2 times covered. US session focus includes a handful of Federal Reserve speakers and June PPI data.  

In commodities, WTI futures advance almost 1% rising for a third day, and adding some upside pressure on yields, as Trump threatened further strikes on Iran after the US resumed its blockade on the Strait of Hormuz, and the US carried out more strikes against Iran, hitting dozens of military sites near the strait and along the nation’s coast. Brent crude futures rise 0.5% to just above $85 a barrel while European natural gas futures rise 3% to the highest since March. Precious metals decline.

US economic data calendar includes July Empire manufacturing and June PPI (8:30am). Fed calendar includes Williams (8:45am), Warsh testifies before Senate Banking Committee (10am), Cook (1pm) and Musalem (6:30pm). Fed releases latest Beige book at 2pm

Market Snapshot

Top Overnight News

• The US launched more airstrikes on Iran, with Donald Trump pledging to intensify his bombardment until Tehran stops attacking ships in the Strait of Hormuz and agrees to open the waterway. BBG
• As the U.S. war with Iran resumes, there is little sign that diplomacy can stop it. Efforts by Arab, Pakistani and other mediators to revive negotiations or restore a ceasefire have shown no public signs of progress, and the overall feeling in the Middle East and beyond is that the fighting will simply continue for now, according to two analysts and a person familiar with the situation. Politico
• The cost of the war with Iran could be more than triple the most recent estimate of roughly $30 billion, according to three U.S. officials and three people familiar with the internal cost estimates. NBC
• Nasdaq futures advanced as ASML raised its annual sales forecast for the second time this year, offering fresh evidence of AI-driven demand. SK Hynix continued its volatile run though, with the stock jumping in Seoul but ADRs falling premarket. BBG
• Stripe and Advent offered to buy PayPal at a valuation of more than $53 billion, Reuters reported. Their $60.50-a-share bid is around 28% more than PayPal’s closing price yesterday. RTRS
• BABA (Alibaba)’s Qwen AI will be integrated into Apple Intelligence in China. RTRS
• China’s economy slowed more than expected last quarter to the weakest in more than three years, raising pressure on policymakers to speed up public spending to ensure their annual growth goal is met. China’s Q2 GDP came in a bit below expectations (+4.3% vs. the Street +4.5% and down from +5% in Q1), but retail sales were ahead of plan for June (+1% vs. the Street -0.1%), as was industrial production (+5.3% vs. the Street +4.6%)  BBG
• Trump administration may pursue further executive action addressing China-related concerns over open-source AI models, according to Semafor citing an unnamed senior White House official.
• Beijing plans to fight attempts to monopolize advances in AI technology, state newspaper People’s Daily reported, following US attempts to curtail overseas access to cutting-edge models. BBG
• The rush for cash by some of the world’s largest companies is putting the long bull market at risk. Investors have been cheering the raging bull market for years—three years and nine months, to be precise—with the S&P 500 having more than doubled during that period. Now companies are racing to take advantage, raising concern that the party could be coming to an end. WS
• Fundamental L/S Gross leverage has declined in 5 of the last 6 weeks to 207.2% (28th percentile 1-year, 75th percentile 3-year). After reaching a 4-year high in early June, Fundamental L/S Net leverage has fallen -6.7 pts to 54.5% (22nd percentile 1-year, 39th percentile 3-year). Goldman PB

A more detailed look at global markets courtesy of Newqsuawk

APAC stocks traded with a positive bias as most major indices took impetus from the gains on Wall St, where sentiment was underpinned, and Fed rate hike bets were trimmed following softer-than-expected CPI data, while US President Trump also abandoned plans for a 20% Hormuz fee. ASX 200 eked out marginal gains with outperformance in miners following Rio Tinto's quarterly update, although the upside in the index was capped as defensives lag. Nikkei 225 rallied amid tech strength, but with further upside limited following weak Machinery Orders. KOSPI was boosted by the tech-related momentum and with SK Hynix shares up by a double-digit percentage as it played catch-up to the 27% surge in its ADRs. Hang Seng and Shanghai Comp diverged with the mainland lagging after a slew of mixed data releases, including Chinese GDP and activity data.

Top Asian News

• China announced a five-year plan to boost consumption and targets CNY 60tln yuan in retail sales by 2030, according to Nikkei.
• China's stats bureau deputy head said China's CPI and PPI are in reasonable ranges and hard won given most countries face big price increases, while the official added that China's energy supplies are sufficient, production is stable, and imports are under control. Furthermore, it was stated that the Q2 GDP growth slowdown is due mainly to short-term factors and external factors, while H1 GDP growth lays a good foundation for achieving the full-year growth target.
• Japan added a footnote on BoJ autonomy to its revised fiscal policy draft, Bloomberg reported.
• Japanese PM Takaichi said FX rates should be determined by the market; boosting international competitiveness will boost the credibility of JPY.
• India announced INR 1.28tln new semiconductor manufacturing plan, according to reports.

European bourses (STOXX 600 U/C) are broadly lower, with the outperformance in the AEX (+0.8%) following ASML earnings. Despite the lack of clear drivers for the underperformance, geopolitics persist, with US President Trump announcing that the US will conduct strikes again on Wednesday and threatening to hit power plants and bridges unless Iran starts to negotiate. Sectors are broadly negative. Consumer Products & Services (+1.2%) tops the sector pile, as positive Richemont earnings lift other luxury names, while Tech (+1.0%) also gains. To the downside lie Optimised Personal Care (-1.1%), Chemicals (-1.1%) and Telecoms (-0.8%). The highly anticipated ASML earnings did not disappoint. Top and bottom line figures beat estimates while raising its FY revenue guidance to EUR 43-45bln (exp. 39.4bln, prev. guided 36-40bln). Looking ahead to Q3, ASML projects sales of between EUR 11-12bln, above Jefferies' estimates of EUR 10.34bln. ASML stated that they are considering a 30% boost to EUV output for 2027 and again in 2028. Both Citi and JPMorgan highlighted this as a positive, with JPMorgan projecting it to add over EUR 65 in EPS in 2028. However, Citi points out that the 2027 production figure would amount to around 85 machines, which is below its forecast of between 90-100. Gains were seen as much as 7.4% at the start of trade, but has since pulled back to around 3.7%. US equity futures are firmer across the board. NQ (+0.5%) is the clear outperformer, helped by the ASML earnings and gains in SK Hynix overnight; however have come off in recent trade (in line with ASML). Banking earnings continue in the US, with Morgan Stanley on the docket.

Top European News

• Ed Miliband's opponents in the Labour Party believe he has failed his bid to become Chancellor, with current Home Secretary Mahmoud seen by some MPs as favourite to take the Chancellor role in Andy Burnham's new government, according to FT.
• OECD said the UK economy to grow 0.9% in 2026 and 1.1% in 2027, with risks tilted to the downside. Added that fiscal discipline is essential to the UK.
• German government is planning a EUR 13.3bln energy relief package for 2027, which will be used to assist businesses and consumers.

FX

• G10s mixed against the Buck, which is flat on the day despite being off recent lows. AUD and GBP lead; NOK underperforms.
• DXY looks to breach 101.00 after lifting from recent lows in the wake of cool US CPI on Tuesday. As Fed Chair Warsh said during the House testimony on Tuesday, one series does not make a trend, so while bets are trimmed for an immediate hike (prev. markets saw a 50% probability of tightening in July), eyes remain on incoming data. In addition to the post-CPI bounce, the Buck is being helped by energy benchmarks, which remain elevated amid a lack of positive Gulf newsflow.
• NOK is the worst G10 performer after the Norges Bank’s preferred inflation gauge, CPI-ATE, came in cooler than analyst/Norges Bank forecasts. NOK saw immediate pressure on the release (which was originally scheduled for 10th July).
• AUD and GBP are the best-performing G10 currencies, helped by the above factor as the cooler-than-expected US CPI trimmed bets for near-term Fed tightening, increasing appetite for these high-yielders.
• For GBP specifically, the UK press suggested Energy Secretary Miliband was less-favoured in the race for Chancellor, now Foreign Secretary Cooper and Home Secretary Mahmood are favourites for the job. Markets think that Mahmood would be fiscally conservative given her view on immigration; however, she lacks experience in economic roles, whereas Cooper previously worked as Chief Secretary to the Treasury under Gordon Brown. GBP/USD +0.1% and either side of the 1.34 mark.

Fixed Income

• USTs remain contained, caught between CPI and Warsh. Bunds lower on energy, but off worst levels despite a sharp but ultimately short-lived decline in the early morning. Gilts opened on the backfoot, given energy.
• USTs flat in a narrow 108-24+ to 108-31+ band, fresh catalysts light. Commentary remains focused on June’s dovish CPI report and the subsequent hawkish Fed testimony from Chair Warsh. Today, we get more insight on both points via Warsh’s Senate testimony and US PPI for June. Additionally, Fed’s Williams (voter) is on the docket.
• Bunds lower by around 20 ticks, but are a similar amount clear of the 124.79 trough. A base that printed in a bout of somewhat short-lived bout of pressure this morning. No obvious catalyst behind that, though it did occur in tandem with modest DAX and EUR downside. Ongoing focus on pension reform may have contributed, given reporting earlier in Politico that suggested pension points could be reduced in some scenarios, saving multiple billions; though, the debate continues and won’t be resolved this week.
• Alternatively, or additionally, the German Finance Ministry outlined that some EUR 13bln or energy-related relief is planned for 2027, funding for that to be sourced from the climate relief package.
• Gilts opened lower by 16 ticks and have since moved lower to an 86.89 base, holding above the 86.87 and 86.42 lows from the last two sessions. Pressure the typical underperformance seen in Gilts when energy leads. No real relief from reports, such as the FT, suggesting that Miliband has lost the race to be Chancellor; though, outlets make clear that no decision has been made yet, ahead of Burnham becoming PM this weekend.
• Germany sells EUR 0.753bln vs exp. EUR 1.0bln 2.50% 2054, EUR 0.768bln vs exp. EUR 1.0bln 2.90% 2056 & EUR 0.759 vs exp. EUR 1.0bln 0.00% 2052 Bund.
• Australia sells AUD 700mln 4.50% Apr 2033 bonds b/c 4.29, avg yield 4.6620%.

Commodities

• Geopolitics remains in focus, with US and Iran still conducting strikes. Markets appear to be accustomed to the ongoing attacks, with focus now on how transits through the Strait are being impacted. On that note, 11 vessels went through the passage, 9 of those used the Iranian-designated route. Yen Ling Song of S&P Global Energy wrote that “we are seeing significantly greater caution among shipowners and operators”, given the threat of Iranian strikes. On this front, traders have continued to price in another supply glut this month – and recent rhetoric from President Trump/Iran, does not point to a near term resolution.
• To recap, Trump warned that they would be striking Iran on Wednesday night, and threatened to hit power plants/bridges next week, unless Iran negotiates. Iran stated that it is a mistake to think military action will force them to talk.
• Crude benchmarks are modestly firmer this morning. Price action overnight was fairly rangebound, but then dipped in early European trade – benchmarks have remained near recent lows since. Brent Sept’26 traded within a USD 85.02-86.55/bbl range.
• Spot gold is a little lower this morning, but ultimately within the prior day’s ranges. Price action which appears to be a bit of pull-back from the extremes seen on Wednesday, following the cooler-than-expected CPI print. The yellow-metal currently holds above the USD 4k/oz mark, in a USD 4,017-4,062/oz range. Base metals hold a negative bias, as markets digested mixed Chinese data. 3M LME Copper traded within a USD 13,550-13,677/t range.
• US Private Inventory Data (bbls): Crude -0.6mln (exp. -2.7mln), Distillates +2.3mln (exp. +1.0mln), Gasoline -1.7mln (exp. +0.6mln), Cushing +0.2mln.

Trade/Tariffs

• EU Trade Commissioner Sefcovic said they are aiming to have the EU-India FTA implemented in 2027.

Central Banks

• ECB's Nagel said from a monetary policy perspective, it remains advisable to react with caution but to act decisively if needed. Monetary policy will maintain its vigilant stance.
• ECB's Panetta said EZ inflation is currently around 3% and expected to remain above that level until early 2027. Risks linked to higher energy prices, tighter financial conditions and persistent geopolitical uncertainty appear to be only partially incorporated into market evaluations. Several indicators suggest the rise in equity markets seen after the Iran conflict is due to an underestimation of risks. ECB's goal is to keep inflation expectations firmly anchored, limiting indirect and second-round effects of shocks.
• ECB's Kocher said they are ready to take monetary policy actions at any time if needed, adding that the ECB will do what is needed to bring inflation to 2% in medium-term and no second round effects seen currently.
• ECB's Cipollone said that he is not currently seeing second round inflation effects, but monitors inflation expectations "very closely".

Geopolitics

• US President Trump said in a pre-recorded Fox News interview that they are beating up Iran badly and Hormuz has to stay open, while he added that strikes will continue until he says it is enough, as well as stated they will save energy targets for last and will ultimately hit energy targets. Trump also said they will hit Iran hard on Wednesday night, and that next week will get really bad for Iran, in which they will hit Iran's power plants and bridges next week unless Iran comes to the negotiating table. Furthermore, he said US officials spoke to Iran on Tuesday and told Iran that it better make a deal.
• US Central Command forces began launching an additional round of strikes against Iran at 15:00EDT/20:00BST on Tuesday, to continue degrading Iranian capabilities used to attack commercial shipping in the Strait of Hormuz, while CENTCOM later announced the completion of strikes against Iran.
• US struck Qeshm Island in southern Iran, and explosions were heard in the maritime area of eastern Hormozgan and Sirik, while explosions were heard in Bandar Abbas and Hengam Island. Explosions were also heard in Bampur and Chabahar in Iran, although Iran's semi-official news agency Tasnim noted officials denied reports of explosions in Chabahar, while explosions were reported in Iran's port city of Bandar Imam Khomeini, and a mineral water plant in Deloran was hit by three projectiles. Furthermore, reports noted that air defences around the Bushehr Nuclear Power Plant in Iran became active.
• IRGC said it targeted enemy weapons and parts storage in Bahrain and Kuwait, while it targeted a drone ramp in Kuwait's Ali Al Salem air base and targeted US positions at Jordan's Azraq base, as well as the US Fifth Fleet Command HQ, fuel facilities and equipment in Bahrain. IRGC said as long as the US evil stays in the region, not a drop of oil and gas will be exported from the region, and that US aggression will have no result other than delaying the opening of the Strait of Hormuz.
• Iran will respond to the US attacks, Tasnim reported.
• Iran's Deputy Foreign Minister Gharibabadi said the US is making a mistake if it thinks its military attacks and blockade will force them to request negotiations, but also commented that Iran's return to negotiations and tolerance regarding the Strait of Hormuz is possible. Furthermore, he said the MoU effectively no longer exists and that no country should expect Iran to continue implementing the terms of the memorandum.
• Israeli PM Netanyahu is reportedly to travel to Washington on Saturday evening, aiming to meet with US President Trump, Yedioth reported.

US Event calendar

• 7:00 am: Jul 10 MBA Mortgage Applications, prior -2.2%
• 8:30 am: Jul Empire Manufacturing, est. 9.2, prior 5.7
• 8:30 am: Jun PPI Final Demand MoM, est. 0%, prior 1.1%
• 8:30 am: Jun PPI Ex Food and Energy MoM, est. 0.3%, prior 0.4%
• 8:30 am: Jun PPI Final Demand YoY, est. 6.2%, prior 6.5%
• 8:30 am: Jun PPI Ex Food and Energy YoY, est. 5.1%, prior 4.9%

Central Bank speakers

• 8:45 am: Fed’s Williams Delivers Keynote Remarks
• 10:00 am: Fed Chair Warsh Testifies Before Senate Banking Committee
• 1:00 pm: Fed’s Cook Speaks on the Economic Outlook
• 2:00 pm: Fed Releases Beige Book
• 6:30 pm: Fed’s Musalem Delivers Welcoming Remarks

DB's Jim Reid concludes the overnight wrap

A quick reminder the WOW! pack can be found here but life moves onto to the 2026 "Mapping the World's Prices" document which saw a whole host of press coverage from all round the world yesterday from Athens to Zurich and Berlin to Wellington. The stand-out theme from this year's edition is just how cheap Japan is. For example, a meal for two in Tokyo is a third of a cost of that in Zurich or New York. When we started the document in 2012 the US was very cheap and now its very expensive. Unless a country is in terminal difficulty, relative prices are a good future mean reversion indicator. For Japan we will likely look back on these relative prices as an indicator of how cheap it is. If nothing else it’s a very cheap destination for next year's holidays. There's plenty of other info on 69 globally important cities. See the report here at the Deutsche Bank Research Institute.  I wonder how cheap or expensive England 2026 World Cup Winning T-shirts will be in London tomorrow!  

As we await the second semi-final, it’s been another eventful 24 hours for markets, with investors taking heart from a huge downside surprise in the US CPI print, even as oil prices kept ratcheting higher. So markets rapidly priced out the chance of a Fed rate hike in a couple of weeks’ time, with US Treasuries posting strong gains as a result. Indeed, the 2yr yield (-9.0bps) was down to 4.19%, its biggest decline since May, whilst the S&P 500 (+0.38%) moved back within 1% of its record high from last month. In Asia US futures continue to rise and the KOSPI is back with a 7% plus day. More on that later but first the US inflation data.  

That CPI print was the main catalyst for the cross market rally, after consumer prices fell by -0.4% in June (vs. -0.1% expected). In fact, it was the biggest monthly price drop since the pandemic lockdowns of April 2020, and it pushed the year-on-year reading all the way down to +3.5%, having been at +4.2% in May. Admittedly, that was driven by a big slump in gasoline prices, which plummeted by -9.7% on the month. But even core CPI was surprising on the downside too, with a -0.02% monthly price drop (vs. +0.2% expected) amid a decline in core goods prices and subdued rent inflation. So that marked the first decline for core CPI since May 2020, and it pushed the year-on-year reading for core CPI down to +2.6%.

For markets, the main consequence was that the chance of a July rate hike was immediately priced out, with the probability down from 43% on Monday to just 17% by last night’s close. And that effect was clear further out the curve, as the chance of a hike by September also fell back to 66%, signaling a growing chance that the Fed might remain on hold for some months to come. Moreover, that led to a big decline for Treasury yields too, with the 10yr yield (-3.4bps) down to 4.59% by the close.

The 10yr Treasury yield traded low as 4.521% post-CPI but it then recovered somewhat, in part as Fed Chair Kevin Warsh continued to strike a tough note on inflation as he delivered his first testimony as Chair before the House Financial Services Committee. Warsh refrained from any direct policy guidance, while noting that yesterday’s softer CPI print did not mean “mission accomplished”. He also said that “members of our Committee have no tolerance for persistently elevated inflation” and argued that if the Fed “get policy right—and we will—the inflation surge of the last five years will be a thing of the past.” In all, the new Chair looked to cement inflation-fighting credibility. But he was fortunate to be making these tough remarks in a day of soft CPI, with the inflation data easing the pressure for any immediate policy tightening.   

Yet even as CPI surprised on the downside, oil prices continued to move higher, with Brent crude up another +1.72% yesterday to $84.73/bbl, taking its 2-day gain since the weekend to +11.47%. Nevertheless, that was actually well beneath the intraday peak above $87/bbl, with a big pullback after President Trump said that the proposal for a 20% fee in the Strait of Hormuz would be replaced by “Trade and Investment Deals that the various Gulf States will be making into the United States.” Meanwhile, the US military announced that it had resumed its naval blockade of Iran overnight, with Iranian media reporting an exchange of fire in the Strait of Hormuz. Overnight, Brent is +1.19% higher, trading at 85.74/bbl as we go to print.  

But for the most part, there were signs that investors were still looking through the latest oil price spike. Brent is well below its peak from earlier in the year, having spent around two months above $100/bbl. And as Henry pointed out yesterday (link here), earlier in the year it took Brent at $110/bbl before we saw meaningful vulnerabilities for equities and credit. And if we look back at the 2022 shock as well, it was a similar real-terms threshold for Brent (above $110/bbl in today’s prices) that started to cause meaningful stress, which we’re still some way from right now.

For equities, yesterday was another eventful session as earnings season started to get going. At the headline level, the S&P 500 (+0.38%) did well thanks to the downside CPI print and the dovish rates repricing. But this included some big moves under the surface, with IBM (-25.21%) posting its biggest daily decline in available Bloomberg data back to 1968, after they missed analyst estimates. It's another example of the huge ongoing tech disruption. Other software stocks also underperformed, including ServiceNow (-5.76%) and Adobe (-4.30%). Despite this, the information technology sector (+1.25%) was the best performer in the S&P 500 and the NASDAQ was up +0.90% amid gains for chipmakers that pushed the Philly semiconductor index +2.54% higher. So differentiation within the tech sector continues to be an ongoing theme, and one that supported the headline indices yesterday even as the equal-weighted S&P 500 slipped (-0.38%).

There were also some big earnings advances as well, with Goldman Sachs (+9.00%) posting its best day since Trump announced the 90-day tariff extension last year, which came after their own earnings beat expectations. There were also sizeable gains for JPMorgan (+2.50%) and Bank of America (+1.88%) after their results, which helped the KBW Bank index to a +1.05% gain. This morning S&P (+0.20%) and Nasdaq (+0.74%) futures continue to rally.  

Asian equity markets are also higher with the KOSPI (+7.70%) back leading the gains. Elsewhere, the Nikkei (+1.14%) and the Hang Seng (+1.46%) are also posting solid advances, while mainland Chinese equities remain subdued, with the CSI 300 (+0.04%) and Shanghai Composite (-0.08%) after Q2 GDP "only" expanded by 4.3% year-on-year, falling short of 4.5% expectations and slowing notably from the previous quarter (5%). As a result, first-half growth came in at 4.7%. On a quarter-on-quarter basis, GDP rose 0.9%, marking the slowest pace of expansion in more than two years.

Additional June data presented a mixed picture of momentum. Industrial production increased 5.3% year-on-year, surpassing expectations of 4.6% and accelerating from 4.5% in May, highlighting continued strength in the industrial sector. In contrast, fixed-asset investment fell -5.7% in the first half of the year from a year earlier, a steeper decline than expected and a deterioration from the -4.1% drop recorded over the January–May period. Retail sales rose 1.0% year-on-year in June, outperforming expectations for a slight contraction, although consumer spending remained relatively subdued. Meanwhile, China’s property market continued to weaken, with new home prices declining -0.15% month-on-month in June. While this represented a modest improvement from May’s -0.20% decline, persistent softness in housing demand across most regions continued to outweigh isolated signs of stabilization in major cities.

Earlier in Europe, markets generally put in a decent performance yesterday, with the STOXX 600 (+0.17%) reaching a one-week high, alongside modest gains for the FTSE 100 (+0.30%), the DAX (+0.13%) and the CAC 40 (+0.03%). For sovereign bonds there was a weaker performance however, with yields on 10yr bunds (+0.6bps), OATs (+0.8bps) and BTPs (+1.1bps) all moving higher. But as with the oil price, that was actually a decent pullback from earlier in the session, when the 10yr bund yield had been up over +3bps on the day.  

Looking at the day ahead, we’ll hear from Fed Chair Warsh again, who’s appearing before the Senate Banking Committee. Otherwise, central bank speakers include the Fed’s Williams, Cook and Musalem, the ECB’s Panetta and Nagel, and the BoE’s Pill. Meanwhile, the Bank of Canada will announce their latest policy decision, and the Fed will release their Beige Book. Data releases include US PPI inflation for June, and the Empire State manufacturing survey for July. Finally, today’s earnings releases include Morgan Stanley, BlackRock, United Airlines, and Johnson & Johnson.

Tyler Durden Wed, 07/15/2026 - 08:28

Federal Regulators Direct Banks To Scrutinize Loans To Illegal Aliens

Authored by AG News Staff via American Greatness,

Federal banking regulators have closed a long-standing loophole that allow illegal immigrants borrow money from U.S. financial institutions with little scrutiny of their legal status.

The Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corporation (FDIC), and the National Credit Union Administration (NCUA) jointly advised that banks "might consider" requiring customers to produce "evidence of continuing work authorization" and other documentation when assessing whether a borrower can repay a loan. The agencies also directed banks to watch for risky concentrations of lending in "geographic markets, employers or industries" that could be "disproportionately affected" by the Trump administration's expanded immigration enforcement.

The guidance carries out President Donald Trump's executive order signed in May, "Restoring Integrity to America's Financial System," which sought to cut off illegal immigrants' access to the U.S. banking system. That order directed the Treasury Department and financial regulators to draft stricter due-diligence standards for verifying customer identities and evaluating loans to people in the country illegally.

Current federal law does not bar banks from serving illegal immigrants, an omission the administration has moved to address after sustained pressure from supporters of Trump's deportation agenda, who have pushed the White House to cut illegal immigrants off from the financial system entirely as part of a debanking effort.

Trump signaled he wants the crackdown to go even further than the executive order. In a Truth Social post last month, he said bank accounts used to "enable" illegal immigration should be shut down and seized outright, though he offered no specifics on how such seizures would be carried out.

The Consumer Financial Protection Bureau (CFPB) reinforced the administration's approach last month with its own guidance, cautioning banks about the credit risks tied to lending to immigrants who lack legal work authorization.

Tyler Durden Wed, 07/15/2026 - 08:05

Largest US Power Grid Is 6.8 Gigawatts Short To Ensure Reliability On Historic Data Center Boom

The largest US power grid failed for a third straight year to secure enough future supply commitments to ensure reliability for the future amid a historic boom in data center demand.

PJM Interconnection, the largest US power grid (Regional Transmission Organization), which serves 67 million customers in 13 states and Washington, DC, said its auction to procure power for the year starting June 2028 fell 6.8 gigawatts short of what it will need to guarantee system reliability during demand spikes, in a statement released Tuesday. The shortfall is equivalent to almost seven traditional nuclear reactors.

The result ramps up pressure on a grid that’s home to Virginia’s Data Center Alley, the biggest concentration of data centers in the US, and has borne the brunt of criticism for the struggle to manage the AI boom and sufficiently protect customers from soaring costs. Attention now shifts to an emergency procurement mechanism later this year that aims to shift the burden of ramping up power generation to hyperscalers.

6.831 Megawatt Shortfall

PJM Interconnection today announced the results of its 2028/2029 Base Residual Auction (BRA), which secured 138,318 MW of unforced capacity generation (UCAP) and demand response to meet projected electricity needs for the more than 67 million people across 13 states and the District of Columbia, which fall under the RTO's umbrella.

Regions under the Fixed Resource Requirement (FRR) acquired an additional 10,864 MW in UCAP, for a total of 149,182 MW in UCAP available to serve forecasted peak electricity demand, plus a reserve margin. UCAP represents a generation resource’s maximum output adjusted for its estimated ability to reliably perform at times of highest system risk. The capacity of the resources procured in the auction, plus FRR resources, is short of PJM’s reliability requirement by 6,831 MW, meaning that the committed supply is less than what would be required to meet the one-event-in-10-year reliability standard (and with electricity-guzzling data centers popping up almost daily these days, the one-event-in-10-year has become a daily occurrence).

This shortfall was not unexpected given the conditions PJM has been observing, including a shortfall of approximately 6,500 MW in the previous capacity auction (for the 2027/2028 Delivery Year). These most recent auctions were the first in PJM history in which the entire RTO fell short of the reliability requirement. PJM plans to seek FERC approval to hold a special “Backstop Procurement” in September to help address the near-term shortfall in electricity supply.

In coordination with the governors of all 13 PJM states and the Federal Energy Regulatory Commission, PJM established a price cap and floor, or collar, for four capacity auctions to protect both consumers and investors from market volatility. This was the third consecutive auction with the price collar.

The clearing price came in at the FERC-approved price ceiling of $325 per megawatt-day which will show up in users’ monthly utility bills; the price was a 2.5% decrease from the 2027/2028 Base Residual Auction cap of $333.44 per megawatt day.

Source: PJM

Costs would be even higher if not for the price cap first negotiated in 2024. While that has helped keep a (loose) lid on costs, PJM has been among those to say that the system also means there isn’t a sufficient price signal for producers to build new power generation. 

The table below from the PJM statement shows what prices would have been without a price cap.  For 2028/2029, all prices cleared at $554.72  except the COMED LDA, which cleared at $776.69. 

In other words, absent a regulatory cap, the price of electricity would be 70% higher ($554.72 vs $325).

Source: PJM

Meanwhile, advanced technology providers of nuclear energy such as modular reactor companies Nano Nuclear and Oklo are just waiting for the green light to plug their energy sources into the grid. 

Payouts to generators for the year starting June 2028 matched the last auction’s all-time high of $16.4 billion set in December, according to PJM (the total value does not equate to the total cost to load because load that is hedged through self-supply or bilateral contracts is not exposed to the clearing prices in the auction). 

PJM power prices jumped 76% during the first quarter due to rampant demand from data centers, according to a report from Monitoring Analytics, the grid’s independent market monitor.

PJM CEO David Mills recently described such a situation as “untenable."

Commenting on today's auction, Mills said that “these auction results show that demand for electricity continues to grow faster than electricity supply. At the same time, PJM recognizes how this supply-and-demand imbalance impacts the reliability of the system and costs for consumers. We are working with government and industry leaders on multiple fronts to restore that balance by bringing on new generation as fast as possible and managing the growth of new load on the grid.”  

As we have repeatedly warned when discussing just how little excess capacity there is in the US grid - with PJM already well below the critical reliability threshold - a searing heat dome earlier this month showed just how close the PJM grid is to reaching its limits, with power demand likely surpassing a record that had stood for over two decades. Without urgent action, the grid risks further deterioration with demand outstripping oncoming supply.

Next summer the Eastern seaboard will look like North Korea at night thanks to chatbots pic.twitter.com/NEY97pa1LB

— zerohedge (@zerohedge) May 6, 2026

PJM already was under intense scrutiny with data centers and power generators saying they are not being connected fast enough as consumer groups and politicians hammer the grid for spiraling power bills. Those concerns are likely to come to a head at a July 23 conference called by the Federal Energy Regulatory Commission to discuss grid governance.

The latest auction result, intended to guarantee enough capacity is available for the few hours in a typical year when demand peaks, will also put further onus of an emergency measure slated for later this year to fill the supply gap and ensure data centers pay. As Bloomberg notes, PJM has yet to submit its proposal for exactly how that will work, but the process is set to get underway in September after heavy pressure from the White House and state governors.

Tyler Durden Wed, 07/15/2026 - 07:55

PayPal Soars On Reported $53 Billion Buyout Bid From Stripe And Advent

PayPal shares surged the most on record in premarket trading in New York after Reuters reported that payment company Stripe and private equity firm Advent International have offered more than $53 billion to acquire the struggling payments platform.

PYPL shares are up 20% premarket... 

It's the biggest single-day jump since at least 2015 (which is near the lows where it is currently trading)...

Bloomberg noted call option volume surged ahead of the Reuters report:

Call option volume and implied volatility for Paypal surged ahead of a report that Stripe and Advent had made a bid for the ​digital payments firm, indicating some traders were well-positioned ahead of the news.

The proposed $60.50-a-share bid represents a roughly 28% premium to PayPal's Tuesday close, though it remains 80% below the $308 peak recorded in July 2021.

Here's more from the report:

The offer, submitted earlier ‌this month, is backed by about $50 billion in committed financing from banks, said one of the people. The offer represents around a 28% premium to PayPal's closing share price on Tuesday.

Rumors of a potential acquisition first surfaced in late February when Bloomberg reported that Stripe had expressed interest in PayPal.

Related:

• PayPal Suffers Worst Drop In Four Years After Profit Miss, CEO Set To Exit

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Tyler Durden Wed, 07/15/2026 - 07:45

ASML Rises On Upgraded Outlook As Capacity Expansion Signals Robust Chip Demand

Technology stocks moved higher early Wednesday after ASML Holding delivered strong earnings and raised its full-year guidance, providing fresh evidence that demand for the advanced chips and manufacturing equipment powering the AI boom remains intact.

Nasdaq 100 futures gained about 40bps, while ASML shares rose 4% in Amsterdam after the company lifted its annual sales forecast for the second time this year. SK Hynix surged 8.8% in Seoul as the memory-chip maker's locally listed shares caught up with its US-listed ADRs, which soared 27% on Tuesday.

Focusing on ASML earnings, the company now expects annual revenue of 43 billion euros to 45 billion euros, well above its previous guidance and the Bloomberg Consensus estimate of 39.3 billion euros.

Second-quarter sales and profit also beat the Bloomberg Consensus estimate, while ASML lifted its full-year gross-margin forecast to as much as 56%, exceeding the 52.5% estimate.

ASML shares are up 4% in Amsterdam. Year-to-date, shares have risen 75%, continuing a powerful uptrend and maintaining the up-and-to-the-right pattern since mid-2025.

ASML plans to increase capacity for its low-NA extreme ultraviolet lithography machines by about 30% in 2027 and is considering another 30% expansion in 2028. CEO Christophe Fouquet said customers are increasing capital-spending plans, creating demand for more machines beginning this year.

Here's a snapshot of the full-year forecast (courtesy of Bloomberg):

• Sees net sales EU43 billion to EU45 billion, saw EU36 billion to EU40 billion, estimate EU39.3 billion (Bloomberg Consensus)
• Sees gross margin 54% to 56%, saw 51% to 53%, estimate 52.5%

Third quarter forecast:

• Sees net sales EU11.0 billion to EU12.0 billion, estimate EU10.27 billion
• Sees gross margin 55% to 57%, estimate 52.5%
• Sees R&D expenses about EU1.2 billion

Results suggest that ASML customers, including TSMC, Samsung and SK Hynix, are expanding production, while Intel has begun using the company's most advanced High-NA system. ASML expects a surge in demand from Elon Musk's proposed Terafab chipmaking project.

Here is Goldman analysts' first take on the ASML earnings, very positive:

ASML: Q2 beat, FY26 guidance was raised, and — more importantly — management gave stronger color on 2027 and 2028

Low-NA EUV capacity, directly addressing the key investor debate. Q2 sales of €9.3bn beat consensus of €8.9bn and came in above the top end of guidance.

Gross margin of 54.0% was also well ahead of the 51–52% guide and 51.7% consensus. Q3 guidance was materially better than expected, with sales of €11–12bn — around 11% above VA consensus at the midpoint — and gross margin of 55–57%, implying Q3 EBIT is roughly 26% above VA consensus.

The most important takeaway is that management addressed the core investor question on AI-driven EUV capacity. ASML said AI demand is accelerating customer capacity plans, order intake was "extremely strong," and it now plans to add 30% to 2026 Low-NA EUV capacity of c.65 tools for 2027, taking capacity to roughly 85 tools.

Other commentary from Wall Street (courtesy of Bloomberg):

Barclays (overweight)

• “We think ASML has given a lot of what investors were looking for," says analyst Simon Coles
• Says its guidance for low-NA EUV capacity for 2027 and 2028 should reduce investor debate on whether the firm is supply constrained
• Low-NA EUV bookings in 1H could be as much as €22b, reaching record levels

JPMorgan (overweight)

• The 2028 capacity guidance implies more than €65 in EPS for 2028, potentially enhanced even more so by the very strong installed base management revenue, says analyst Sandeep Deshpande
• The company isn't guiding to 90 EUV tools for 2027, but "we don't believe this should matter" given the much stronger-than- expected guidance for EUV and DUV capacity for 2028

Jefferies (hold)

• The company's outlook comments are mixed, with the strong increase in installed base management sales and gross margins being especially positive, while the 2027 EUV guide is underwhelming, says analyst Janardan Menon
• Says 2027 low-NA EUV capacity guidance is below market expectations that have climbed sharply recently

Morgan Stanley (overweight)

• Despite no longer reporting bookings, the company talked of very strong order intake continuing across 1H, and customers looking to accelerate capacity expansions, says analyst Lee Simpson
• That suggests strong sales momentum into FY27

Oddo BHF (outperform)

• Estimates should go up materially, probably in the range of 20%
• China exposure remains at around 20% of 2026 sales but is now on a materially higher revenue base, with incremental demand coming primarily from logic
• "ASML remains a story of unrivaled tech dominance and now benefits from a fundamentally different cycle driven by AI"

Stephan Kemper, chief investment strategist at BNP Paribas Wealth Management, noted, "As such, company fundamentals matter more than ever."

But more importantly, read our latest note on hyperscaler stress titled "Carnage" In The Hyperscaler Bond Market: Did Goldman Just Pop The AI Debt Bubble ... 

Tyler Durden Wed, 07/15/2026 - 07:20