Global Financial Breakfast | July 2, 2026

Today's Highlights

Federal Reserve Chairman Walsh: Inflation expectations and inflation risks have both declined in recent weeks
U.S. June ADP employment increase lower than expected
Walsh appoints Bessent's aide as Fed advisor, sources say
Meta reportedly plans to sell excess AI computing power
Wang Yi holds phone conversation with U.S. Secretary of State Rubio
Agent confirms MLCC leader Yageo's price hike is true

Market Recap

On Wednesday, Federal Reserve Chairman Walsh stated that inflation expectations and inflation risks have eased in recent weeks. The U.S. dollar index rose then pared gains, eventually closing up 0.25% at 101.39; the benchmark 10-year U.S. Treasury yield closed at 4.458%, while the 2-year U.S. Treasury yield, sensitive to Fed policy rates, closed at 4.183%.

Due to lower-than-expected U.S. ADP employment data and Walsh's remarks that inflation is receding, which pushed U.S. Treasury yields lower, spot gold closed up 0.59% at $4,031.29 per ounce; spot silver eventually closed up 0.92% at $59.11 per ounce.

Trump said talks in Qatar were progressing well, and optimism over U.S.-Iran negotiations eased market concerns about crude oil supply. WTI crude eventually closed down 2.68% at $68.03 per barrel; Brent crude eventually closed down 3.05% at $71.16 per barrel.

The Dow closed down 0.02%, the S&P 500 down 0.2%, and the Nasdaq down 0.66%. Nvidia (NVDA.O) fell 1%, Micron Technology (MU.O) fell 10.5%, SanDisk (SNDK.O) fell 10.6%, AMD (AMD.O) fell 6.8%, Meta (META.O) rose 8.8%. The Nasdaq China Golden Dragon Index surged 2.9%, Alibaba (BABA.N) rose 2%.

Major European stock indices mostly closed lower. Germany's DAX30 closed up 0.18%, the UK's FTSE 100 closed down 0.18%, and the Euro Stoxx 50 closed down 0.72%.

Hong Kong stocks were closed for one day due to the Hong Kong Special Administrative Region Establishment Day, with southbound and northbound trading halted.

China's A-share three major indices showed clear divergence. The Shanghai Composite briefly surged over 1%, while the ChiNext and Shenzhen Component indices traded sideways. In the afternoon, all three major indices weakened, with the Shanghai Composite erasing earlier gains and briefly turning negative, and the ChiNext falling over 2%. At the close, the Shanghai Composite closed up 0.44%, the Shenzhen Component closed down 0.53%, and the ChiNext closed down 1.89%; total trading volume on the Shanghai and Shenzhen exchanges exceeded 3.5 trillion yuan, with over 4,000 stocks rising. In terms of sectors, the large financial sector surged across the board, with brokerages, insurance, and internet finance all rising sharply; the innovative drug sector rebounded from lows; aquaculture and baijiu sectors performed strongly; in the afternoon, most tech stocks retreated, with CPO, fiber optic concepts, high-speed copper cable connections, and other sectors leading declines. The photovoltaic equipment sector remained weak throughout the day, with Sungrow Power Supply falling 13.9% in a single day.

International News

1. Meta reportedly plans to sell excess AI computing power.

2. Walsh appoints Bessent's aide as Fed advisor, sources say.

3. Micron Technology invests $250 million in the "Trump account."

4. Trump advisor Hassett urges Fed not to raise interest rates.

5. World Gold Council: Gold prices may trade around $4,100 within the year.

6. U.S. decides not to renew USMCA, shifting to rolling reviews and negotiations.

7. Sources: OPEC+ likely to increase August oil production quotas by 188k bpd at Sunday's meeting.

8. U.S. June Challenger job cuts total 45.85k, the lowest since December 2025.

9. U.S. June ADP employment increased by 98k, the smallest gain since March, below the market expectation of 118k.

10. Speeches by four central bank governors—① Fed Chairman Walsh: Inflation expectations and inflation risks have both declined in recent weeks. Will not provide forward guidance. The dot plot will still be retained for now. It's no secret that I want to shrink the balance sheet. ② Bank of England Governor: Not considering rate cuts at present. Policy has been tightened without raising rates. ③ European Central Bank President: Risks to euro area inflation and economic growth are now more balanced than a few weeks ago. ④ Bank of Canada Governor: We are at the lower end of the neutral rate range, roughly at an appropriate level to contain inflation. ⑤ Walsh invited former Bank of England Governor Mervyn King to lead the Fed's communications working group.

11. Middle East Situation—① Qatar: Positive progress on the memorandum of understanding issue, all parties agree to advance discussions. The next meeting will be held after the funeral of the former Supreme Leader of Iran.

② Iran is ready to sell oil to all countries except Israel.

③ Iran's Deputy Foreign Minister: In talks with Qatar, it was decided to use part of the unfrozen $6 billion in funds to purchase necessary supplies according to Iran's needs. A supervision group will be formed, and violations of the memorandum of understanding will be reported and reviewed through direct communication channels. A working group responsible for following up on the implementation of the memorandum and negotiating the final agreement has been established, and consultations continue through mediators to determine the time and place for the working group's negotiations.

④ Media say Doha negotiators have reached a preliminary agreement to release $3 billion in funds to Iran.

⑤ U.S. media: The U.S. is trying to persuade Iran to give up collecting tolls, saying that the benefits after sanctions are lifted will be "a hundred times" higher.

Domestic News

1. Wang Yi holds phone conversation with U.S. Secretary of State Rubio, both sides agree to continue communication in a flexible manner.

2. CATL resumes production of 100k tons of lithium carbonate capacity.

3. Agent confirms MLCC leader Yageo's price hike is true.

4. RatingDog June China Manufacturing PMI registered 51.7, remaining in expansion territory for the seventh consecutive month.

5. Several new energy vehicle companies released June "report cards," NIO and XPeng returned to the "40k club," while Li Auto and Xiaomi held steady at the 30k-unit threshold.

6. Lead Intelligent Equipment received a inquiry letter from the Shanghai Stock Exchange, requiring an explanation of whether there was any early leakage of inside information.

Risk Warning

☆15:00, China's Ministry of Commerce will hold the first regular press conference in July;

☆17:00, the Eurozone will announce May unemployment rate, market expectation 6.3%, previous value 6.30%;

☆19:45, 2027 FOMC voter, San Francisco Fed President Daly will participate in a conference on the Spanish economy;

☆20:30, the U.S. will announce June unemployment rate, market expectation 4.30%, previous value 4.30%;

☆20:30, the U.S. will announce June seasonally adjusted non-farm payrolls, market expectation 110k new jobs, previous value 172k;

☆20:30, the U.S. will announce initial jobless claims for the week ending June 27, market expectation 220k, previous value 215k;

☆20:30, the U.S. will announce June average hourly earnings data, market expectation annual rate 3.50%, previous value 3.40%; monthly rate expectation 0.30%, previous value 0.30%;