MPC Markets Morning Call

Trump declared the Iran ceasefire "over" at NATO, launching a second day of strikes as markets closed. Oil surged past $80 before settling at $78.55. The S&P dipped 0.3% while chip stocks bounced. Fed minutes showed a split committee on rate hikes under new chair Warsh. We break down the Iran escalation, oil dynamics, Hormuz traffic, Nvidia's China chip deal, the IMF growth downgrade, bond yield spikes, earnings season risks, and why portfolio hedging matters right now.

Samsung's record profit wasn't enough. Chip stocks got hammered across the board, with the Philly Semis down 4.7% and Intel off nearly 10%. The US hit Iran with fresh strikes and revoked its oil sales waiver after three tankers were attacked in the Strait of Hormuz. Crude surged 5%, gold dropped, and bond yields hit a four-week high.

But here's the thing — most S&P 500 stocks rose. Money is rotating out of tech, not leaving the market. We break down what that means, plus SpaceX's rough first day on the Nasdaq 100, SK Hynix's monster IPO, the VIX sitting at cycle lows, and what to watch for Wednesday including the Fed minutes.

Chip stocks snap a two-week losing streak on light post-holiday volume. AMD, Broadcom, TSMC all up big — Nvidia lagged on delay rumours. Dow at a record, S&P within 1% of highs. Bitcoin up nearly 10% in five days. Former Japanese currency czar says yen undervalued by 20%. Fed Chair Warsh testifies tonight, first-under-Warsh minutes out Wednesday. ASX news: Lynas, South32, Netwealth, VanEck's AI ETF. Daily market briefing with Mark Gardner at MPC Markets.

Dow hits record 52,899 but chip stocks crater. June payrolls: 57k vs 115k expected. Rate hike odds slashed. We cover the jobs miss, what it means for the Fed, Meta's $145B AI capex scramble, oil flattening at pre-war levels, gold surging on dollar weakness, and why 87% of the S&P 500's H1 gains came from chips alone. Plus the 1990s Desert Storm parallel for where inflation goes from here. No show Monday (July 4th) — back Tuesday. Catch Bulls vs Bears this afternoon for the full H1 wrap.

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Book a Portfolio Review: https://www.mpcmarkets.com.au/portfolio-review/Semiconductor stocks were hammered today after reports that OpenAI has dramatically cut inference costs through software optimisations — slashing GPU requirements for large parts of ChatGPT traffic. The SOX Index fell over 6% in its worst session in months, hitting Nvidia, AMD, Intel and chip equipment names hard after one of the strongest quarters on record.In this episode we break down what this means for the AI infrastructure trade, whether hyperscaler capex is at risk of slowing, and how the market is digesting the shift from training-heavy to inference-heavy dynamics. We also cover progress in US-Iran talks in Doha on the Strait of Hormuz and frozen assets, which helped ease oil supply concerns.Plus, Fed’s Kevin Warsh struck a dovish tone on inflation risks at ECB Sintra, while fresh ISM data showed pipeline price pressures cooling sharply. We discuss positioning implications across equities, energy, gold and what to watch as US markets head into the July 4th holiday.

Best quarter in six years and chips stole the show. SOX up 88% for the quarter — its best ever. Micron quadrupled. Intel trebled. And the Mag Seven? Down 4% for the year. The companies spending the money are lagging the companies selling them the shovels.

Gold's had its worst quarter since 2013, down 24% from the January highs. Iran talks resume in Doha but the "back to normal in two weeks" calls from Wall Street feel detached from reality. Samsung and SK Hynix just pledged $1.3 trillion in new chip investment. Nike beat on both lines and still sold off. JOLTS job openings hit a two-year high and rate hike bets are building.

Plus: ASX starts FY27, South32 sells its aluminium business to Alcoa for $8.1bn, and why healthcare might be the rotation play when chip stocks eventually turn. Payrolls land Thursday night with no US market Friday — that Asian open could get spicy.

S&P 500: 7,496 (+0.8%) | Nasdaq: 26,213 (+1.5%) | Dow: record 52,317 | SPI: 8,784

The Dow closed at a record 52,182 as Alphabet debuted in the index and tech staged a sharp rebound from last week's semiconductor selloff. Mark Gardner breaks down whether this is genuine buying or end-of-quarter window dressing — plus why the best quarter for equities since COVID might actually be a warning sign.

Also covered: the Japanese yen at 40-year lows and what that means for equity markets, the ASX outlook with RBA minutes due today, Collins Foods hitting record revenue, early-stage biotech momentum, and a busy week ahead with non-farm payrolls landing on a pre-holiday Thursday.

Key numbers: S&P 500 +1.2% to 7,439 • Nasdaq +2.3% • Dow +0.6% to 52,182 • SOX +87% YTD • Yen 161.94/USD (1986 low) • WTI $70.54 • ASX futures 8,825

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MPC Markets | General commentary, not financial advice.

The chip index dropped 7.9% last week while Iran broke the ceasefire and struck two ships in the Strait of Hormuz. Oil barely moved. The Fed's Kashkari has swung to a rate hike. And the BIS just warned that sovereign debt, AI overinvestment and leveraged hedge funds are building systemic risk.

Mark covers the chip selloff and what it means for hyperscaler margins, why software stocks at 52-week lows could be a generational buy, the healthcare rotation, and what to watch on the ASX this shortened week — including RBA minutes, tax-loss selling season and U.S. payrolls on Thursday.

New episodes every weekday before the ASX open. Visit mpcmarkets.com.au/podcast for the full written Morning Call.

Micron's blowout AI earnings sent memory stocks surging 16% — but the consequences hit fast. Apple raised prices across MacBooks and iPads by up to $500, Microsoft hiked Xbox pricing, and every Mag Seven name traded lower. The chip boom is feeding the same inflation problem the Fed is already fighting.

KPMG now expects two rate hikes by year-end. May core PCE held at 3.4% YoY, GDP was revised sharply to 2.1%, and oil rebounded after an IRGC attack on a cargo ship in the Strait of Hormuz threatened the fragile US–Iran peace deal. In Australia, employment surprised massively to the upside at +40,300 jobs — ASX futures up 9 points at 8,755.

Covered today: Micron's $22bn in locked-in orders and what it means for hyperscaler margins, Apple and Microsoft passing costs through to consumers, the PCE inflation read and Fed hike outlook, the Hormuz incident and oil dynamics, commodities getting belted on the week, Australian employment and RBA minutes preview, plus the week ahead with non-farm payrolls brought forward for Independence Day.

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Micron Technology crushed Wall Street expectations overnight, reporting Q3 revenue of $41.5 billion (a $6.2 billion beat) with cloud memory up 307% year-on-year and core data centre up 653%. The stock surged ~13% after hours, dragging Nasdaq futures up around 2% and effectively reversing the session's losses. Qualcomm added to the momentum with positive CEO commentary.

In today's Morning Call, Mark Gardner covers:

— Why Micron's result matters for the broader AI trade and whether the rally can continue from here
— Oil hitting its lowest level since before the Iran war as 20 million barrels transit the Strait of Hormuz
— The commodity rout across gold, silver, copper and crude — and where the buying opportunities might be
— U.S. dollar strength and what's driving the move despite weakening consumer discretionary budgets
— Australia's May employment data due today and what it means for the RBA rate path
— Trim mean inflation coming in slightly higher than expected — rate hikes still on the agenda?
— Healthcare sector green shoots: why names like CSL, Telix and Vive are starting to turn
— JPMorgan and Goldman Sachs boosted dividends after passing Fed stress tests
— a2 Milk's positive update and Tourism Holdings' fresh takeover approach

ASX 200 futures pointed ~20 points higher at the close. SPI up around 0.2% to 8,810.

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