[Platinum Insights] (6.27.23)

Good morning. 

Wall Street futures fell on this morning, pressured by a report on new U.S. curbs on exporting artificial intelligence (AI) chips to China. Shares of chip companies Nvidia fell 4.6% in premarket trading, while Advanced Micro Devices dipped 3.5% on the news. 

Markets are awaiting the Personal Consumption Expenditures (PCE) index, the Fed’s favored inflation gauge, initial jobless claims data and the final reading of first-quarter GDP later this week to assess the state of the U.S. economy. Investors are also focused on a panel discussion of key central bank policymakers including Powell and European Central Bank President Christine Lagarde at the ECB annual forum in Sintra, Portugal. 

U.S. government bond investors have racked up positive returns so far this year, with the higher income from bonds offering a buffer against market weakness if the Federal Reserve increases interest rates again. So far this year, Treasury yields – which move inversely to prices – have increased in the short part of the curve as the Fed raised rates another 75 basis points on top of 425 basis points last year. Two-year Treasury yields stood at 4.76% as of Tuesday, up from 4.4% at the beginning of the year. 

Walgreens Boots Alliance, Inc. shares dropped over 9% on Tuesday after the company lowered its full-year profit forecast and reported downbeat quarterly earnings. Investors are awaiting earnings results from General Mills, Inc., UniFirst Corporation and Micron Technology, Inc. today. 

WTI crude futures were at $67.68 per barrel. Gold held below $1,920 an ounce while the yield on the US 10-year Treasury note hovered around 3.7%. 

The Dow Jones closed higher by around 212 points to 33,926.74 on Tuesday. The S&P 500 rose 1.15% at 4,378.41, while the Nasdaq Composite surged 1.65% to settle at 13,555.67 during the session.

 Have a great day!