Wall Street woke up on Thursday to the scent of euphoria, as stock futures ticked upward on the back of a surging semiconductor sector. Micron Technology, often a backstage hand in the glitzy world of AI innovation, delivered a stellar earnings report that did more than lift its own shares by over 2.3%. It ignited a broader rally in chipmakers, a class of stocks now carrying the burden of national hopes, technological sovereignty, and market momentum. Nvidia touched yet another record. The Nasdaq hovered within whispering distance of its all-time high.

Yet, even as investors bask in the glow of AI's promise, a darker and more politically charged narrative simmers beneath the surface. Micron's success - and the sector-wide enthusiasm it inspired - coincides with increasingly chaotic signals from Washington, where President Donald Trump is reportedly considering announcing Jerome Powell's replacement months before the end of the Fed Chair's term. It's a move that has financial observers scrambling for their civics textbooks and central bankers revisiting their oaths of independence.

The Wall Street Journal reported that Donald Trump intends to name Powell's successor as soon as possible (probably by October, given that his term ends in May 2026). The aim is to send a message and put pressure on the current Fed chairman, who is considered too unruly. Kevin Warsh, Kevin Hassett, and Scott Bessent (who had already declined, I believe) are among the candidates being considered by the White House. The WSJ specifies that the US president is evaluating candidates based on their commitment to lowering rates and, I quote, their "made-for-TV" appeal.

Micron's earnings might reflect AI exuberance, but the rest of the macroeconomic picture is less rosy. Traders, clinging to Powell's careful rhetoric before Congress, still price in multiple rate cuts by year's end - an acknowledgment that despite robust corporate profits, the broader economy walks a tightrope between resilience and stagnation. Durable goods data and the final first-quarter GDP estimate - released this morning - offered clues. In a disquieting signal for the U.S. economy, goods exports in May fell by 5.2% month-over-month - the sharpest decline since the early pandemic turmoil of 2020. The steep drop suggests a weakening in global demand or a growing drag from trade tensions and tariffs, raising fresh concerns about the resilience of American manufacturing amid geopolitical uncertainty. Meanwhile, weekly jobless claims came in at 236,000 for the week ending June 21, slightly below economists’ expectations of 243,000, offering a sliver of reassurance that the labor market remains relatively stable. 

But the real tell will be Friday's release of the Personal Consumption Expenditures report, the Fed's preferred inflation gauge, now shadowed by tariff threats and growing geopolitical unpredictability.

The market's early morning climb appears to be powered by a paradox. On one side is the dazzling optimism of AI and on the other, the creeping realization that monetary policy may become a political football in a high-stakes election year. If Trump's rumored nomination of a dovish Fed successor becomes reality, it could upend the Fed's credibility and further weaken the already-sliding dollar, which just hit a three-year low.

This confluence of events presents an unsettling picture. The same investors cheering Micron's forecast are also hedging against future inflation, recalibrating bond strategies, and squinting at the Fed with suspicion. Treasury yields are falling - but not too far.

In the background, subtle but telling corporate shifts are taking place. Meta poached three researchers from OpenAI, a reminder that in the world of AI, talent is the true currency. Coinbase, a once-embattled crypto platform, reached its highest close since 2022. Shell and BP plc sparked merger rumors, underlining the strategic reshuffling across industries, although it was denied by the parties. And Nike, bracing for what analysts call an “ugly” quarter, still managed to lift its stock ahead of earnings..

In other news, the US has managed to get other NATO members to pay more. Everyone congratulated each other yesterday, especially since Washington has tipped the balance back in Ukraine's favor in the conflict with Russia. 

In Asia-Pacific markets, the picture is very mixed. Indices went from a 1.1% decline in South Korea, where the strength of US semiconductors has not spread, to a 1.5% gain in Japan. Australia and Hong Kong were down slightly, while India gained some ground. European leading indicators are bullish, with the Stoxx Europe 600 up 0.2%.

Today's economic highlights:

Today: in the United States, the Chicago Fed National Activity Index, durable goods orders, annualized GDP, new unemployment claims, wholesale inventories, and pending home sales. See the full calendar here.

  • Dollar index: 97,264
  • Gold: $3,334
  • Crude Oil (BRENT): $66.95 (WTI) $65.08
  • United States 10 years: 4.28%
  • BITCOIN: $107,262

In corporate news:

  • Shell is reportedly in preliminary discussions to acquire competitor BP in a transaction valued at approximately $80 billion. BP plc shares surged following news of Shell's potential acquisition.
  • Warehouse REIT has agreed to Tritax's takeover offer, choosing it over a competing bid from Blackstone.
  • Microsoft and OpenAI are facing disagreements over an AGI contract clause in their partnership.
  • Meta has hired three OpenAI researchers to bolster its superintelligence team.
  • FedEx shares dropped 6% due to a lower profit forecast and trade war uncertainties.
  • Nvidia breaks its record and regains the title of world's largest company by market capitalization from Microsoft.
  • The EU launches an antitrust investigation into Mars' acquisition of Kellanova.
  • Micron gains 2% in pre-market trading following its quarterly results.
  • Solventum withdraws its drinking water treatment unit from the proposed acquisition of its filtration division by Thermo Fisher.
  • Hims & Hers refuses to give in to Novo Nordisk's demands, according to its CEO.
  • Dutch groups CCC and the Consumers’ Association plan to sue Booking.com for allegedly inflating hotel prices since 2013.
  • Pfizer said phase 3 data show its hemophilia drug Hympavzi cut bleeding episodes far more than on-demand therapy.
  • Walgreens Boots Alliance reported Q3 EPS down 40 % to $0.38 despite higher sales, citing weak U.S. retail trends.
  • Palantir Technologies will co-develop an AI-based nuclear-construction platform with The Nuclear Company in a $100 M deal.
  • Incyte appointed former Anthos CEO Bill Meury as its new chief executive.
  • Cyngn is using Nvidia’s Isaac platform to build autonomous industrial vehicles.

Analyst Recommendations:

  • Equinix, Inc.: BMO Capital Markets downgrades to market perform from outperform with a target price reduced from USD 1045 to USD 850.
  • Factset Research Systems, Inc.: Raymond James upgrades to market perform from underperform.
  • General Mills, Inc.: RBC Capital upgrades to outperform from sector perform with a price target reduced from USD 67 to USD 63.
  • Jefferies Financial Group Inc.: Zacks upgrades to neutral from underperform with a price target raised from USD 45.55 to USD 59.
  • Mgm Resorts International: Citizens downgrades to market perform from market outperform.
  • New Fortress Energy Inc.: BTIG downgrades to neutral from buy.
  • Texas Pacific Land Corporation: Texas Capital upgrades to buy from hold with a price target raised from USD 1240 to USD 1280.
  • The Trade Desk, Inc.: Wells Fargo downgrades to equalweight from overweight with a target price reduced from USD 74 to USD 68.
  • Celsius Holdings, Inc.: BNP Paribas Exane maintains its outperform recommendation and raises the target price from 46 to USD 56.
  • Coinbase Global, Inc.: Oppenheimer maintains its outperform recommendation and raises the target price from USD 293 to USD 395.
  • Micron Technology, Inc.: Barclays maintains its overweight recommendation and raises the target price from USD 95 to USD 140.
  • Quanta Services, Inc.: Jefferies remains at a hold recommendation with a price target raised from USD 298 to USD 359.
  • Regal Rexnord Corporation: KeyBanc Capital Markets maintains its overweight recommendation and raises the target price from USD 125 to USD 180.
  • The Cooper Companies, Inc.: Rothschild & Co Redburn maintains its buy recommendation and reduces the target price from USD 120 to USD 95.