Better-than-expected U.S. earnings drove a strong rebound from recent lows, led by the Nasdaq and Philadelphia Semiconductor Index as optimism toward technology and semiconductors returned. Meanwhile, Trump canceled planned military strikes on Iran, easing market concerns and supporting European equities. However, Europe lagged the U.S. due to its lower technology weighting.
Trump canceled planned military strikes on Iran, allowing U.S.-Iran talks to continue and easing Middle East tensions. Lower geopolitical risk pushed Brent briefly below US$80/bbl and pulled Treasury yields off recent highs. The U.S. 10Y yield fell to around 4.65% and the 30Y to 5.20%, lifting bonds across the curve, with long-duration bonds outperforming.
The latest ISM Manufacturing Index rose further, with key sub-indices improving. New orders rebounded, while new export orders returned above 50, signaling solid U.S. manufacturing demand. Production accelerated and employment returned to expansion, consistent with improving labor data. Prices continued to ease from recent highs, though only modestly, suggesting inflation pressures remain.
SpaceX 2Q26 revenue rose 66.5% QoQ to US$7.81bn. AI compute revenue reached US$2.56bn, up 247.5% YoY, as compute leasing contracts with Google, Anthropic and other customers began contributing. Starlink subscriber growth also drove satellite communications revenue up 66% YoY to US$4.29bn.
Japan’s nominal wage growth accelerated to 3.4% YoY in June, supporting steady growth in regular wages and reflecting a tight labor market. Real wages rose 1.6% YoY, marking a sixth straight month of growth as wages caught up with inflation and household purchasing power improved. Consumption remained positive, with retail sales rising modestly. Food and essentials demand stayed solid despite weak durable goods spending. Overall, wage growth remains a key support for domestic demand.
Japanese stocks have recently pulled back, mainly reflecting valuation corrections in AI-related names after strong gains. Meanwhile, most corporate earnings have beaten expectations, driving continued upgrades to earnings growth forecasts and signaling improving fundamentals.
