Public Markets 3 Days

Last updated: July 3, 2026, 11:30 AM ET

Global Markets & Macroeconomics

Global stocks experienced a broad rally, with Europe's benchmark index reaching an all-time high as jitters surrounding the artificial intelligence trade subsided. The U.S. dollar weakened against a basket of currencies, touching a two-week low, following a worse-than-expected U.S. jobs report that cooled rate-hike concerns. Investors are dialing back bets on a Federal Reserve interest rate increase this month, with U.S. stocks ending mixed after the disappointing June hiring data. The WSJ Dollar Index fell 0.5%, snapping a two-day winning streak to 97.25. Meanwhile, gold extended its gains, buoyed by the weakening dollar and the risk-on sentiment. In Asia, South Korean stocks rebounded sharply, jumping 5% after a turbulent prior week marked by AI-related swings, highlighting skittish investor sentiment amid growing scrutiny over the sustainability of the global AI boom.

Energy & Commodities

OPEC crude oil production surged in June as Persian Gulf members restored exports through the Strait of Hormuz, aided by a peace accord between the U.S. and Iran. This increase in supply, coupled with recovering transits through the Strait of Hormuz, has led to bearish forecasts for oil prices, with Citigroup predicting Brent crude could fall $60 barrel by year-end. Goldman Sachs also flagged the potential for an oil surplus, even as nations rebuild stockpiles as traffic recovers. Russia's subsidy payouts to domestic refiners jumped more than six-fold in June from a year earlier, as Moscow sought to avoid shortages by keeping more fuel at home amid biting shortages. Russian refineries are facing long lines for gasoline, shattering the illusion of normalcy in wartime Russia, with one citizen questioning, "Are we in the Soviet Union now?". French oil major Total Energies SE is offering millions of barrels of Iraqi crude for prompt delivery to Asia, further adding to the market's ample supply as refiners take notice.

Artificial Intelligence & Technology

Investor sentiment surrounding the artificial intelligence trade is showing signs of strain, with cracks appearing in the AI build-out and causing whiplash in tech-heavy indexes. Doubts are creeping in about the profitability and sustainability of the AI expansion, leading to a loss of a key signal in the sector. European chip stocks rebounded after a selloff, following their Asian peers as investors reassessed AI-linked equities. A new wave of AI factories is forcing power equipment firms to rethink their portfolios in a market expected to be worth over $200 billion annually seeking new opportunities. The immense sums poured into AI are fueling a trillion-dollar debt binge, with a century-old private bond market opening a new front for tech borrowers to sell debt directly to insurance firms seeking capital. Meanwhile, Meta Platforms Inc. and SoftBank Group Corp.'s recent moves are exposing fault lines in the growing pile of AI debt, suggesting that beneath the surface, the booming AI world is turning into a cause for concern. The U.S. government is reportedly looking into the water usage of AI data centers, which may be far higher than most tech giants disclose, particularly when considering the water used at the power plants supplying electricity to these facilities.

Mergers, Acquisitions & IPOs

GFL Environmental Inc. is considering a potential take-private transaction, having drawn interest from buyout firms seeking a deal. Carlyle Group Inc. has hired JM Financial Ltd. and Goldman Sachs Group Inc. to advise on a potential initial public offering of its India-based healthcare revenue cycle management business aiming for $400 million. In a rescue deal, iCON Infrastructure is set to buy Northern Fiber Holding Gmb H, a struggling German fiber-network operator formerly owned by UBS Asset Management, from its lenders to avoid insolvency. CVC Capital Partners Plc is financing its buyout of Italian food-ingredients maker Irca SpA with €1.2 billion ($1.4 of high-yield bonds to fund the acquisition. Industrial machinery maker Renk Group AG has agreed to acquire privately held David Brown Defence for approximately $200 million, gaining greater exposure to the naval sector in a strategic move. In India, state objections are mounting over Mediterranean Shipping Co.'s planned $1.4 billion investment in an Adani Group-run terminal, intensifying scrutiny of the Swiss firm after a chemical spill last year raising concerns.

Central Banks & Monetary Policy

Despite recent U.S. labor market weakness, the Federal Reserve will likely need to hike interest rates this year, according to two French chief economists in their assessment. The European Central Bank is in a comfortable position following its June rate hike, as falling oil prices ease price pressures in the euro zone, according to Governing Council member Emmanuel Moulin in a recent statement. Federal Reserve Chair Kevin Warsh has indicated that inflation risks are diminishing, contributing to a broader sense of economic strength and easing concerns about further rate hikes as price pressures fade. U.S. stocks rose as this sentiment took hold, with the S&P 500 and Nasdaq logging their best quarterly performances since 2020 ending the day higher. Investors are concerned that a quieter approach from the Federal Reserve under Warsh could lead to increased market volatility as communication shifts.

Geopolitics & Defense

A U.K.-Italian-Japanese fighter jet venture has secured a contract valued at $6.14 billion to develop a new stealth fighter jet, with BAE Systems, Leonardo, and Japan Aircraft Industrial Enhancement Co. as the key participants in the defense deal. Russia has hiked its June subsidies to refiners, with payouts jumping more than six-fold from a year earlier, as Moscow aims to avoid shortages and keep more fuel at home amid domestic pressures. Crimea has become a critical theater in the Ukraine War, with escalating drone strikes, fuel shortages, and power cuts in the annexed region heating up the conflict. Drone incursions over Europe, frequently observed near military assets, are raising concerns about Russian activities, with analysts suggesting it marks a campaign to probe defenses and gather information near NATO borders. Germany's defense sector is seeing consolidation, with Bavaria-based Renk acquiring U.K. company David Brown Defence for $200 million, a firm that previously assisted in manufacturing Spitfires expanding its reach.

North American Markets

Canadian stocks experienced broad gains, with the benchmark index climbing after Prime Minister Mark Carney unveiled a new pipeline project to the country's West Coast boosting investor confidence. In the U.S., investors are turning away from domestic stocks at the fastest pace since March, with Bank of America noting significant outflows. The dollar remained weak against a basket of currencies following worse-than-expected U.S. nonfarm payrolls data, which prompted investors to dial back bets on a near-term Federal Reserve interest rate increase as hiring cools. U.S. stocks ended mixed after the June hiring data, though the blue-chip Dow average finished at a record as investors reduced rate-hike expectations on cooling data. Brightline, the debt-laden Florida private railroad, tapped reserves to make a July 1 interest payment due to holders of its senior municipal bonds and corporate notes amid financial strain.

European Markets & Regulation

European stocks headed for their best week since May, with the benchmark index rising to an all-time high as jitters surrounding the AI trade subsided building momentum. Money managers in Europe will now have fewer ESG data reporting requirements on their assets under revised disclosure rules, a move aimed at streamlining requirements. France's Finance Minister Roland Lescure indicated he will push for a 2027 budget that brings the deficit below 5% and expects parliament to approve such a budget improving public finances. Germany's central bank is well-positioned to oversee the country's planned state-backed pension fund if tasked with the role, according to President Joachim Nagel offering stability. The UK's Financial Conduct Authority has criticized investment firms for unintelligible disclosure documents and banned 'double-dipping' as it seeks to improve customer treatment enhancing transparency.

Asia-Pacific Markets

Japan's annual wage negotiations concluded with average pay gains topping 5% for a third consecutive year, underscoring the economy's resilience and reinforcing the Bank of Japan's stance to maintain its interest rate policy showing sustained growth. South Korean officials are preparing for currency flows related to SK Hynix Inc.'s offering of American depositary receipts, with the listing anticipated as soon as Friday managing inflows. In India, billionaire Gautam Adani has secured nearly $15 billion in investment commitments this week across his ports, mining, and flagship businesses, as U.S. legal clouds begin to clear boosting confidence. The Indian food regulator has issued notices to at least six energy drink makers, including Red Bull's local unit, for allegedly making misleading claims, tightening oversight of a rapidly expanding market targeting misbranding.

Financial Services & Banking

HSBC Holdings Plc is preparing for a significant risk transfer linked to a portfolio of Asia-Pacific loans as it increases its use of the hedging instrument managing risk. ICICI Bank Ltd., India's second-largest private-sector lender, is in talks to raise at least $500 million in offshore bonds, capitalizing on a recent Reserve Bank of India concession for overseas borrowing seeking capital. Standard Chartered Plc is targeting mid-sized African companies for debt sales, with a $50 million green bond placed last month for a solar home system financier opening the door for similar debt issuances across the continent. The head of BlackRock Inc.'s beleaguered private credit fund is in the process of leaving the firm, a move that follows months of losses on soured loans and revelations of a U.S. regulatory probe amid fund troubles. Starling Bank plans to cut jobs to simplify operations and restructure its banking and tech functions, leading to the elimination of "duplicate" roles as profits dip streamlining operations. Banks continue to charge high overdraft fees, with revenue from these charges rising after Congress scrapped a rule that capped such fees last year increasing revenue.

Corporate News & Deals

Associated British Foods expects its sugar unit to post a loss as market conditions deteriorate, though it maintained guidance for its other businesses ahead of the Primark spinoff facing headwinds. Chanel has acquired luxury Parisian shirtmaker Charvet, a deal for the revered brand that follows an earlier collaboration with Chanel creative director Matthieu Blazy expanding its luxury portfolio. Big brewers, including Const