Daily Note | July 9, 2026 | Discounts, ASA / Gold Comments, NVDA Buy
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Lots of research and news: Steve at the BondBeatup
Despite greater geopolitical risks following a restart of attacks on Iran, and higher oil prices, markets are pointed up. Semiconductors are rallying for a change as the SMH is up 3.5%, and other hot names like Micron and Sandisk up more than 4%.
The S&P 500 is less than two percent away from new all-time highs, but other indices are down more. The XLK, tech sector SPDR ETF, is down 8.5% from its early June high. Small caps are about 2.3% from a new high.
The Fed minutes were released yesterday and indicated that the majority of the participants favored giving out less information (”Fedspeak”) including less speeches and interviews.
The minutes also suggested that the Fed has no idea what is going to happen and will adjust course as the data comes in.
Citi came out and is arguing that the labor market is weakening and that the Fed will shift from focusing on inflation to supporting the jobs. They said June U.S. payrolls weakened sharply, eroding the case for further Fed hikes, while easing oil, rents, and potential core PCE methodology revisions may reduce measured inflation.
Citi pointed to June nonfarm payrolls rising just 57,000, well below expectations. The prior two months were also revised down by a combined 74,000. Following the revisions, the three-month average pace of job growth eased to about 111,000 per month, down sharply from more than 180,000 previously. The unemployment rate fell to 4.189% in June from 4.296%, but Citi attributed the decline mainly to a drop in the labor force participation rate to 61.5% from 61.8%. Citi estimated that if participation had held steady, the unemployment rate would have climbed above 4.5%.
