Wall Street Morning News: Inflation data keeps cooling, storage plunges, Apple leads tech giants; PayPal rises more than 17%, and SpaceX breaks the offer price

From Monday to Friday every morning, we focus on macro, US stocks, AI, precious metals, and crude oil—revisiting the market with data and seizing opportunities with trends, produced by PANews.

Inflation cools, but the Fed’s tone remains cautious; Vaush says AI price hikes don’t necessarily trigger inflation

The latest US 6月 PPI came in below market expectations, further validating the downtrend in inflation and resonating with the previously released CPI. The market quickly cut expectations for the Fed to tighten policy further, with most investors essentially ruling out the possibility of rate hikes in the near term. All three major US stock indexes closed higher: the Dow Jones Industrial Average rose 0.29%, the S&P 500 gained 0.38%, and the Nasdaq Composite climbed 0.62%. Money has flowed back into mega-cap tech stocks, and pressure on growth-stock valuations has eased.

Despite improving inflation data, the Fed internally remains cautious.

• In congressional testimony, Chair Vaush stressed that Fed policy remains independent. AI infrastructure buildout is lifting prices of some commodities, but this does not mean a truly sustainable inflation trend. Whether inflation forms in the future still depends on the balance of supply and demand and monetary policy. He believes current inflation indicators have limitations and pays more attention to data changes over the coming months.

• Meanwhile, Fed Governor Cook said that inflation risks have once again surpassed employment risks due to AI investment, tariffs, and supply shocks from the Middle East. If inflation fails to continue falling in the future, they do not rule out taking further action.

• New York Fed President Williams was relatively more moderate, saying inflation is still high, but there are signs it may be topping out. Current policy is sufficient to bring inflation back to the 2% target. For traders, this implies the Fed will not rush to raise rates in the near term, nor quickly pivot to aggressive easing.

Trump continues to pressure rates, saying that compared with hiking, it is “better for the Fed to stand pat” and he hopes to see rates decline. He expects year-end inflation to be lower than the current level and hinted there may be resistance within the Fed.

The Fed’s latest Beige Book shows the US economy continues to expand at a moderate pace, with 11 of 12 districts seeing growth in economic activity. The jobs market is broadly stable, but energy prices remain the biggest variable for future inflation. Shortages of technical workers in some areas continue to push up wage costs, meaning inflation still has the possibility of bouncing around in the future.

Holzh risk is still there; oil’s rally is capped by inventories

The Middle East situation continues to provide a geopolitical premium to oil prices. After a 5-day US military strike on Iran, the targets reportedly included military facilities related to threats to navigation freedom through the Strait of Hormuz. Trump said Iran is “very eager” to reach a deal, but at the same time said oil prices will remain volatile for a while. If the situation in Iran stabilizes, oil could fall to $55 per barrel.

WTI and Brent crude are trading in ranges around $80 and $85, respectively, and inventory data limits upside room for oil prices. Data from the US Energy Information Administration showed that weaker demand led to a large increase in distillate fuel inventories. US crude production remains at a high level. Overall oil exports grew, but they are still below recent pre-war averages. Goldman analyst Yulia Grigsby noted that if the risk of a Strait of Hormuz blockade truly materializes, the market could face a supply gap on the order of 13.4 million barrels per day. At that point, more pronounced demand destruction and inventory drawdowns would be needed to rebalance.

Short-end rates lead the decline; the dollar gives back the Vaush move

After PPI cooled, short-end US Treasuries were bought quickly. The 2-year yield fell by about 7 basis points, while the 30-year yield dropped by only about 2 basis points. The yield curve further steepened. HSBC’s rate strategist Dhiraj Narula said the market has already reduced the implied probability of the next FOMC rate hike, bringing yields moderately lower. But since oil prices have rebounded since July, investors remain wary of upside inflation risk, so yields still stay near relatively high levels for the year.

The US Dollar Index weakened following Treasury yields, down about 0.43% on the day, erasing more than half of the gains since Vaush took office. For US stocks, a weaker dollar benefits profit translation for multinational tech companies, which also helps explain the strength in mega-cap tech stocks last night.

Over the next one or two days, institutions will focus on US retail sales, initial jobless claims, the Philadelphia Fed manufacturing index, and key earnings reports from TSMC, Netflix, and others. Macro traders won’t be looking at just one data point, but whether “inflation cooling can coexist with consumer resilience.” If retail sales hold up and initial claims do not rise, US stocks can keep trading a soft-landing narrative. If consumption clearly weakens, the market may shift from optimism about rate cuts to worries about growth.

Tech giants become a safe haven; AI trading shifts from “buying chips” to “buying platforms”

Inflation cooling combined with the start of earnings season has kept risk appetite rising. Funds have clearly rotated out of the storage-chip segment, which surged earlier, and into large tech platforms with more stable cash flows. The “Seven Tech Giants” index rose 2.47%, becoming a core force supporting the Nasdaq.

The Philadelphia Semiconductor Index fell 2.08%. Storage chips were hit the hardest, with Micron, SanDisk, Western Digital, and SK hynix all plunging together. Traders believe AI is still the main theme, but storage and some chip stocks that had risen too much earlier started to take profits; money then moved toward large platform stocks with better liquidity and more stable narratives. Goldman’s trading desk said hedge funds are selling the technology and communications services sectors aggressively, with selling pressure at the 98th percentile over the past year. At the same time, long-term net buyers are still accumulating technology and communications services.

Meanwhile, AI industry headlines are landing in quick succession. Anthropic is reportedly moving fastest and could launch an IPO as early as October this year, with its valuation rising to $965 billion; Huang Renxun appeared in Tokyo, pushing Nvidia to cooperate with Japan’s industrial, robotics, automotive, and gaming sectors; and Trump blasted New York for pausing approvals for large AI data centers, saying data-center taxes and jobs are “liquid gold.” AI is no longer just a chip story—it has become a super-narrative jointly priced by energy, regulation, sovereign computing power, and capital markets.

Specific project moves and stock-price swings:

• Apple rose 4.01%: It set a new all-time high again, with market cap approaching $5 trillion. Apple is actively searching for acquisition targets among chip companies to strengthen its AI server capabilities. At the same time, rumors about AI model adaptation in China reinforce investors’ expectations for Apple’s AI rollout. Related large tech stocks also climbed in tandem: Microsoft rose 2.78%, Amazon gained 3.02%, Google A rose 3.17%, Meta climbed 3.07%, and Nvidia rose 0.33%.

• PayPal surged 17%: It became the best-performing S&P 500 component stock. Reports say Stripe and private equity firm Advent have submitted an offer price of more than $53 billion for an acquisition. Sentiment across fintech and payments chains warmed up, and Circle rose 3.88%.

• The storage-chip sector became the biggest laggard: SK hynix fell 9%, SanDisk dropped 8.12%, Micron fell 8.02%, Western Digital slid more than 8%, and AMD fell 3.46%. Market chatter said the third-party AI compute cloud giant CoreWeave is trying to hedge the risk of storage-chip price declines via derivatives, sparking widespread concern that semiconductor heavy capital expenditures may not translate into free cash flow.

• ASML rose 2.23%: The company released strong signals for AI demand and raised its 2026 sales guidance significantly to between €43 billion and €45 billion. However, its largest customer TSMC strongly opposed ASML’s potential pricing increase plan. TSMC believes the cost of a single machine—over €350 million—is too high, and that it is currently only suitable for R&D.

• Intel fell 4.43%: Even though Intel confirmed it is purchasing and using ASML’s high-end High NA EUV equipment for some Panther Lake processor production, the stock still fell alongside the broader semiconductor sector. While the market still hopes for a revival of Intel’s foundry business, KeyBanc and FactSet reported that Intel’s 18A process yield has improved from 65% to 85%. Still, near-term funds are focusing more on cooling across the overall chip sector.

• Oracle rose 3.56%: Oracle and NetApp launched a fully managed cloud storage service, natively integrating enterprise-grade NetApp storage into Oracle Cloud infrastructure, targeting AI and enterprise-critical workload migrations. The market continues to give valuation premiums to cloud infrastructure and AI data services. Among related cloud and AI infrastructure stocks, Microsoft rose 2.78%, Amazon gained 3.02%, and Nvidia rose 0.33%.

• SpaceX fell 0.60%: This was the fourth straight trading day of decline. During the session, it briefly dropped to $132.15, breaking below its $135 IPO price. Ahead of Starship’s test flight and its first quarterly earnings report, shorts have reportedly added aggressively in recent days; the short ratio is already 28%, and shorts’ paper gains are close to $3.9 billion.

• Johnson & Johnson fell 2.69% after reporting earnings: Although it raised the midpoint of its 2026 operating sales guidance to $100.6 billion, sales of its core product Stelara plunged 55.7% due to competition from biosimilars. Its MedTech cardiovascular segment’s Abiomed sales fell 2%, exposing a growth concern for a medical giant during the transition period between new and old products.

• AST SpaceMobile (ASTS) shares plunged 12% in after-hours trading: The company announced plans to issue $1 billion in principal amount of 2034-due convertible senior notes via a private placement to support an expansion of its launch resources and potential M&A, triggering market worries about equity dilution.

What to watch next:

• On July 16, the US will release June retail sales, the number of initial jobless claims for the week ending July 11, the Philadelphia Fed manufacturing index, and other data, which will directly affect the market’s assessment of US economic resilience and the Fed’s policy path.

• Pre-market on July 16: TSMC, UnitedHealth, GE Aerospace, US Bancorp, State Bank, and Abbott will release earnings. TSMC’s report is especially critical, directly validating AI chip demand, advanced packaging capacity, and the strength of capital expenditures. If guidance is strong, it could ease selling pressure in the chip sector; if gross margin or capital expenditures fall short of expectations, semiconductor adjustments may continue.

• After-hours on July 16 (US stock market): Netflix, Intuitive Surgical, and Alcoa will release after-hours earnings reports. Netflix will test the earnings quality of large-growth stocks in the US market; if subscription and advertising businesses perform strongly, it could continue to support Nasdaq sentiment. Alcoa is a window into industrial demand and the commodities cycle.

• Around July 17: SpaceX’s Starship 13th test-flight window. The test results will become a key catalyst for short-term bulls-vs-bears in SpaceX. If successful, it may ease break-even share-pressure; if it fails or is delayed, combined with earnings and lock-up/unlock worries, price volatility could be amplified further.