July 14th Market Overview

Happy Monday

The markets delivered another lesson in how people think/act vs. how headlines read.

Trump threatened his biggest tariffs yet over the weekend, and stocks are green anyway. Bitcoin made history above $120,000 and corporate America served up some genuine merger surprises.

Earnings season starts tomorrow with the big banks.

Let's dig in...

Summary

1. Markets absorbed Trump's biggest tariff threats yet
The president announced 30% duties on EU and Mexico starting August 1st, then threatened 100% on Russia. Traders bought the news as the Nasdaq hit fresh highs and the EU delayed retaliatory measures to keep talks alive.

2. Bitcoin shattered records above $120,000 
The ATH breakout drove Coinbase to a $100 billion market cap milestone while MicroStrategy added another 683 coins for $79 million as the House prepares crypto legislation votes this week.

3. Critical earnings and inflation week begins 
The big banks earnings tomorrow alongside June CPI data that economists expect to accelerate to 2.7%, testing Federal Reserve dovishness.

Market Overview

Stock Spotlight

Kenvue $KVUE ( ▲ 1.96% ) made the biggest waves after announcing CEO Thibaut Mongon’s departure and launching a comprehensive strategic review. The Tylenol maker’s board is exploring alternatives including portfolio simplification, signaling potential divestitures ahead.

Coinbase $COIN ( ▲ 3.97% ) crossed the $100 billion market cap threshold as Bitcoin’s historic run continued. The timing aligns perfectly with House lawmakers preparing to vote on crypto legislation this week.

MicroStrategy $MSTR ( ▲ 2.94% ) added 683 more Bitcoin to its treasury, paying $79 million at an average of $116,000 per coin. TD Cowen raised its price target to $680, noting no competitor can match the company’s cost of capital advantage.

Waters Corporation $WAT ( ▲ 0.15% ) dropped after announcing its $17.5 billion merger with Becton Dickinson’s diagnostics unit. Waters will take on $4 billion in debt and issue 39.2% of its stock to complete the deal.

Tesla $TSLA ( ▲ 3.25% ) gained after Elon Musk clarified he doesn’t support merging with his AI company xAI but confirmed shareholders will vote on Tesla investing in the venture.

Big Name Updates

Amazon $AMZN ( ▼ 1.43% ) delivered another record Prime Day with U.S. online sales hitting $24.1 billion during the four-day period. The 30.3% growth beat estimates and reinforced the company's e-commerce dominance.

Meta Platforms $META ( ▼ 1.08% ) faces an $8 billion privacy trial while acquiring Play AI, a startup specializing in human-like AI voices. The full team joins Meta next week.

Broadcom $AVGO ( ▼ 0.45% ) pulled out of a proposed $1 billion chip plant in Spain after government talks collapsed, dealing a blow to Spain's semiconductor ambitions.

Other Notable Company News

Goldman Sachs initiated Nebius $NBIS ( ▼ 0.75% ) with a Buy rating and $68 target, calling it a leader in the AI infrastructure rental market.

Morgan Stanley flagged troubling trends at Hims & Hers $HIMS ( ▲ 3.17% ) , noting June marked the first year-over-year decline in app downloads.

Needham raised Uber $UBER ( ▼ 1.82% ) to a $109 target, citing healthy consumer assumptions and booking growth potential.

Piper Sandler downgraded Oscar Health $OSCR ( ▲ 2.25% ) to Neutral, questioning the company's ability to navigate 2026 challenges.

Arista Networks $ANET ( ▲ 0.72% ) earned a positive catalyst watch from Citi ahead of earnings, with expectations for upward guidance revisions.

Sector Watch

Bond Market

The 10-year Treasury yield climbed to 4.429% ahead of Tuesday’s inflation report. Economists forecast June CPI accelerated to 2.7% from May’s 2.4%.

• Bank of America warns recent tariff developments reduce rate cut odds

Policy Watch

Escalated trade tensions with 30% tariff threats on EU and Mexico starting August 1st, plus potential 100% duties on Russia if Ukraine talks don't progress within 50 days. The EU extended its suspension of counter-tariffs until August 1st to allow more negotiating time.

White House targeting Fed Chair Jerome Powell 
The administration is probing Federal Reserve building renovation costs as potential "cause" to justify firing Powell. National Economic Council Director Kevin Hassett confirmed Trump has this authority.

Market risk underappreciated 
Deutsche Bank strategists warn Powell's removal represents one of the market's most under-priced risks, with potential for severe disruption within 24 hours of any action.

Fed independence at stake:
The central bank has pushed back against renovation criticisms while maintaining policy independence, but tensions continue escalating as Trump criticizes Powell for not cutting rates faster.

What to Watch

1. Tuesday's Inflation Data:
June CPI at 8:30 AM ET could reshape Federal Reserve expectations if core inflation exceeds forecasts. Watch for broad-based price pressures beyond tariff impacts.

2. Bank Earnings Triple Header:
JPMorgan Chase, Wells Fargo, and Citigroup report Tuesday morning. Focus on net interest income guidance and loan loss provisions for economic health signals.

3. Crypto Legislative Week:
House votes on multiple cryptocurrency bills that could provide regulatory clarity and fuel institutional adoption beyond Bitcoin's current record run.

4. Tariff Negotiation Developments:
Any progress in EU-US talks before the August 1st deadline could signal broader trade de-escalation and market relief.

5. Fed Chair Uncertainty:
Monitor White House actions regarding Jerome Powell. Deutsche Bank warns this represents significant underpriced risk for immediate market shock.


Thanks for reading 🙂

- John

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