Economy

In the United States, PCE inflation, at +0.45% m/m in May, and Core PCE, at 0.3% m/m and 3.4% y/y, came in line with expectations, while June PMI indices came in above consensus: Manufacturing (55.7, +0.6 pt) and Services (51.3, +0.6 pt), while durable goods orders fell by -4.5% in May versus an expected -4.8%. In the eurozone, June’s PMI indices were more mixed: Manufacturing at 51.3 (-0.3 pt, vs. an expected 51.6) and Services at 48.9 (+1.2 pt, vs. an expected 48.7); the consumer confidence index rebounded to -17.7 (+1.3 pt) but fell short of the expected -17.0. Finally, foreign direct investment in China continues to decline, falling 8.6% year-over-year in May after a 10.3% drop in April.

Artificial Intelligence

OpenAI has launched GPT-5.6 in a limited preview, with three versions: Sol (“frontier”), Terra (cost-effective), and Luna (fast/economical). Access remains restricted to a small number of approved partners, at Washington’s request. As with Anthropic, the same conclusion applies: the models are becoming more powerful, but their commercial deployment may now proceed in a more gradual and regulated manner.

Markets

The rise in core PCE inflation did not prevent U.S. 10-year yields from continuing their decline, thanks to Kevin Warsh’s remarks the previous week and the further drop in oil prices (Brent -10.5%). As a result, government bonds rose by 0.7% (U.S.) to 1.2% (Europe). Stocks did not benefit from this (U.S. -2.0%, Nasdaq -3.3%, Europe 0%, Japan -2.7%, Emerging Markets -4.5%). The reason: a decline in the technology sector, particularly among hyperscalers. The market is reassessing the risk of a surge in AI investment costs. This week, we’ll be tracking: PMI indices, the jobs report, and June consumer confidence in the U.S.; June economic confidence indices and May unemployment rates in Europe; and the official and S&P PMI indices for June in China.

Swiss Market

Coming up this week: May retail sales, the KOF Business Climate Index, and the June PMI indices for purchasing managers; June inflation figures; and the SNB’s first-quarter trading volumes in the foreign exchange markets.
No significant corporate events or earnings reports are expected.

Equities

APPLE (Core Holding) illustrates the gradual pass-through of AI costs to the end consumer. With rising memory and storage prices, the company has adjusted the prices of certain Macs and iPads to preserve its margins. At the same time, Apple has reportedly asked Washington for authorization to purchase DRAM from CXMT, a sensitive Chinese supplier. This development confirms that the supply chain is becoming as much a geopolitical issue as an industrial one—an arena where Tim Cook retains genuine leverage to mediate between Beijing and Washington.

ROCHE (Core Holding) is launching AXELIOS 1, a next-generation sequencing platform that enables full genome sequencing on the same day, with accurate results available within a few hours. The platform offers greater accuracy, faster analysis, and higher throughput, and its launch will support the division’s growth through 2030 (expected to be +5–8% per year).

VOLKSWAGEN (Satellite): According to media reports, VW is considering cutting 100,000 jobs and closing four plants in Germany. If confirmed, this plan (which is expected to be presented to the Supervisory Board on July 9) would be the largest in the Group’s history. VW is also selling a 51% stake in Everllence (engines, turbomachinery, and decarbonization) to Bain Capital for 7.4 billion EUR, compared to a balance sheet asset value of 3.4 billion EUR for 100%. In short, a restructuring of operations and the portfolio is on the horizon.

Bonds

In the U.S., the 10-year yield ended the week down 8 basis points, driven mainly by prospects for an end to the conflict in Iran and a resumption of traffic through the Strait of Hormuz. Economic data was generally positive, with manufacturing and services PMIs on the rise and jobless claims slightly below expectations. In Europe, the 10-year Bund fell by 14 basis points and the 10-year OAT by 11 basis points, driven by services PMIs that remained in sharp contraction. This week, the market will be watching for May’s JOLTS data and June’s ISM readings in the U.S.

Sentiment of traders

Stock markets

The week—shortened in the U.S. due to “Independence Day”—starts in positive territory and will be eventful, with ISM, PMI, industrial orders, and employment data on the agenda, while in the eurozone, CPI and unemployment figures will be released. On the corporate front, we’ll see earnings reports from Nike and General Mills. The still-uncertain geopolitical situation could throw a wrench into the works for indices that remain in good shape.

Currencies

Following an exchange of fire over the weekend between Iran and the U.S., the dollar is consolidating at $/CHF 0.8088 and $/JPY 161.80. This week’s U.S. employment data is expected to reignite volatility. The euro is attempting a tentative rebound at €/$ 1.1408; without a break above the res. 1.1450, we anticipate a test of the sup. 1.1276. The Swiss franc remains firm at €/CHF 0.9225, with support at 0.9175 and resistance at 0.9266. The pound remains under pressure at £/$ 1.3222, sup. 1.3160, res. 1.3325. Gold is at $4,063/oz, sup. 3,886, res. 4,220.

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