The S&P 500 Index is down 0.31% and the Nasdaq 100 Index has decreased by 1.51%, influenced by a sell-off in South Korean chipmakers, which saw the Kospi Index drop over 8%. SK Hynix and Samsung Electronics both fell more than 10% due to concerns over an overextended AI market. In contrast, the Dow Jones Industrial Average is up 0.16% today, with WTI crude oil prices rising over 3% amid escalating US-Iran hostilities.
On the geopolitical front, the US recently launched missile attacks targeting Iranian facilities, prompting Iran to retaliate with strikes on Jordan, Bahrain, Kuwait, and Qatar. This heightened tension is raising inflation expectations as crude oil prices climb. Current forecasts indicate a bullish outlook for Q2 earnings, expected to rise by 23%, primarily driven by AI infrastructure spending.
In financial markets, the chance of a 25 basis point rate hike by the Fed at its next meeting on July 28-29 is estimated at 36%. Overseas, major European markets and China’s Shanghai Composite are lower, reflecting global market sentiment.
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