Macro update
Banks deliver strong results:
Morgan Stanley surged 4.7% to a record high and Bank of America climbed 4.4% after both beat quarterly profit expectations, extending the S&P 500 banking index’s winning streak to three sessions.
Semiconductors rally on AI optimism:
The Philadelphia Semiconductor Index jumped 3% after ASML posted robust earnings and order growth, boosting confidence amid Taiwan Semiconductor Manufacturing Co’s (TSMC) results and driving AI-related stocks higher worldwide.
Trade frictions persist:
President Trump declared the US “in a trade war” with China, though Treasury Secretary Scott Bessent signalled efforts towards de-escalation and a potential meeting with President Xi later this month.
Fed maintains dovish tone:
Federal Reserve (Fed) Governor Stephen Miran said two further rate cuts this year remain likely, while the Beige Book cited selective job losses tied to AI investment and tighter immigration policies.
Asia extends gains:
Asian markets hit record highs on Thursday, led by technology shares. Gold reached a new all-time high above $4,230.00, while oil prices advanced after India pledged to halt imports of Russian crude.
DAX 40 back under pressure
The DAX 40 remains under pressure and while it stays below Wednesday’s 24,339 high, it may slip towards Tuesday’s 23,987 low. A fall through this level may put the 23,800 region back on the cards.
A rise above 24,339 could lead to the 22 August high at 24,444 being revisited.