Market News

Yesterday, I wrote about how AI leaders can't be trusted to tell us the truth about what's coming. I lamented that they've suddenly switched their stance on AI job losses at exactly the same time that they need to raise trillions and get government backing for huge infrastructure projects. That's not a coincidence.

Today, that view got a powerful endorsement from Bill Gates. The Microsoft founder remains among the richest people int he world but now owns very little of the shares as he's steadily sold and donated stock.

Today, he published a crucial essay to raise alarm bells about the lack of preparation and the scale of disruption that's coming.

"I don’t see evidence that leaders, experts, and communities are confronting the challenges…

Crude oil futures are settling at $82.23, down $0.13, or 0.16%, on the day. The session was volatile, with the price trading as high as $83.31 before falling to $79.62 and subsequently rebounding into the settlement.

Looking at the hourly chart, the recovery from the session low fell short of the key moving-average resistance above. The 200-hour moving average is currently at $84.05, while the 100-hour moving average sits just above it at $84.38. That creates a well-defined resistance cluster. Moving above would be more bullish.

On the downside, today’s low stalled ahead of an upward-sloping trendline currently near $79.32. That trendline remains the key support and risk-defining level for buyers.

With crude settling at $82.23, the price…

A 100 MW dedicated inference campus running GB200 NVL72 racks needs roughly $2.91 per GPU-hour to generate a 15% levered equity IRR.

That's the conclusion of a deep dive from the Scotiabank Global Equity Research team. The $2.91 needed to clear the return hurdle and it comes from this:

• $4.03 billion of total project capex on 100 MW of critical IT load,
• That is $40.3 million per megawatt.
• Sixty-four percent of that is IT equipment at $3.0 million per NVL72 rack (much of that going to NVDA)
• Thirty-six percent is the facility at $14.5 million per MW.
• 70% is financed at 8.0% over six years
• It assumes a 15% residual value on IT capex after year six

The good news is that current GB200 rental indications clear it. Another way of looking at it…

• High yield 4.393%
• WI level at the time of the auction 4.391%.
• Tail +0.2 basis points
• Bid to cover 2.37X versus 2.32X
• Directs 28.4% vs average of 21.2%.
• Indirects 61.5% versus average of 65.4%
• Dealers 10.05% versus average of 13.4%

The domestic buyers were the stronger today it ain't 428.4% of the issue. The international buyers were less than the average at 61.5%. The bid to cover was modestly higher than the average. The tail although positive was better than the average of 0.7 basis points.

Auction Grade: B

This article was written by Greg Michalowski at investinglive.com.

The Dallas Fed trimmed mean PCE came in at 2.2% versus 1.5% last month. That compares favorably to the July core PCE your and your at 3.3%, and the headline PCE year on year at 3.7%. However, the rise from 1.5% last month and moving back above the 2.0% level is going the wrong way.

What is the difference between the Trimmed Mean PCE and headline PCE seen earlier?

The Dallas Fed Trimmed Mean PCE Inflation Rate is an alternative measure of inflation designed to filter out the "noise" from unusually large price moves and provide a better picture of the underlying inflation trend.

Here's how it works:

• Starts with the same data as the Fed's preferred inflation gauge — the Personal Consumption Expenditures (PCE) Price Index.
• Instead of removing…

The CIA visit to Moscow yesterday led to some optimism about a thawing or potential deal. Instead, we're getting a further cycle of escalation that follows rumors of 300,000 more Russians set to be drafted.

In any case, oil is higher on this report and it's hard to see this war ever ending.

The Bloomberg report says: 

Russia is preparing to escalate attacks on Ukraine after concluding that negotiations for a peace deal have reached a dead end, according to three people close to the Kremlin. For now, Russia is weighing an intensification of powerful conventional ballistic missile attacks on Kyiv, including the center of the capital, and infrastructure targets in other Ukrainian cities, the people said.

This is obviously being leaked to put…

European shares closed mostly higher, although gains were modest as investors digested the latest U.S. inflation and growth data while awaiting Nvidia’s earnings after the close. Italy’s FTSE MIB led the gains, while the UK FTSE 100 was the only major index to finish lower.

• German DAX: +0.19% at 26,315.92
• France’s CAC 40: +0.27% at 8,462.39
• UK’s FTSE 100: -0.07% at 10,878.11
• Spain’s Ibex: +0.05% at 20,067.29
• Italy’s FTSE MIB: +0.31% at 52,882.98

In the European debt market, benchmark 10-year yields moved sharply higher following the hotter inflation readings from the United States. The increases were broadly between five and six basis points:

• Germany: 3.235%, +5.5 basis points
• France: 4.090%, +5.4 basis points
• UK: 5.037%, +4.9 basis…

The NZDUSD moved sharply higher last week, extending to a high of 0.59831. However, buyers could not sustain the momentum to the high from late May at 0.5993

The initial decline found support near the rising 100-hour moving average yesterday, and buyers made another run to the upside yesterday. That rebound stalled at a lower high near 0.5982, giving sellers the go-ahead to push the pair back lower.  Today, in the Asian Pacific session the price fell below the 100 hour MA with more momentum (blue line currently at 0.59623). The price did bounce with the price reaching the MA level, but sellers held resistance and the price momentum to the downside restarted.  .

The price is now testing a key support cluster near 0.5930. That area includes…

In a post yesterday, I highlighted the importance of the USDCHF swing area extending down to 0.8009, along with the rising 100-hour moving average (blue line on the chart below) and the 50% retracement near 0.8000.

The low today reached 0.8007—between those key levels and just above the 100-hour moving average. Buyers leaned against that support cluster and have since pushed the price steadily higher.

The rebound has now taken the USDCHF toward the next key resistance cluster near 0.8050. That area is defined by the falling 200-hour moving average and the broken 38.2% retracement.

Getting and staying above 0.8050 would strengthen the short-term bullish bias and give buyers more control. Conversely, if sellers lean against the resistance…

• Prior was +4405K
• Gasoline -2536K vs -670K expected
• Prior was +688K
• Distillates -2228K vs -1570K expected
• Prior was -1530K

API data from late yesterday:

• Crude +4200K
• Gasoline -3200K
• Distillates -500K

WTI was trading at $81.63 ahead of the report after falling as low as $79.62 earlier on the Russian report of a ceasefire in Iran.

This article was written by Adam Button at investinglive.com.

Scotiabank published its NielsenIQ Omnishopper and the headline number is a deceleration: consumer spending growth ran at +6.1% y/y in the four weeks to July 11. That's down from +8.1% in May and +7.1% in June. The trailing 12-week figure dipped to +6.4% from +7.1% a month ago.

They say it's a "slight negative," with caution heading into the September reporting season.

It's certainly not a collapse as the first quarter averaged roughly the same pace, so on a year-to-date view nothing has broken. But May and June were the high-water mark and the trend since is slipping. When you're looking at nominal spending growth, the important question is how much of that 6% is price and how much is volume. Given where grocery and fuel costs have been…

Meta has reached a settlement with the California attorney general and other states in a case alleging that its platforms harmed children. The states had filed claims against Meta’s at roughly $200 billion (and not realistic). The settlement caps Meta’s payments to the states at $16.68 billion—well below either figure and clearly better than market expectations. The payments are over 10 years as well.  

Meta shares are up 4.65% at $596 in premarket trading following the news.

From a technical perspective, today’s rise is taking the price closer to its 100-day moving average at $607.35. However, the stock remains below that key technical level. If buyers are to take more control, the price needs to break above—and stay above—the 100-day…