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1. Mag 7 are back!

Microsoft shares are soaring 9% after the bell, hitting a new all-time high and topping the $4 trillion market cap mark after posting a beat-and-raise quarter.

It continues to face data center infrastructure shortages, and it’s throwing money at the problem until the supply-demand balance improves. Its Intelligent Cloud unit revenue rose 26% YoY.

As long as these companies continue to post strong growth and print cash from their core business, investors are likely to be okay with these capital expenditures.

Below: After being down 27% in april, the Mag7 is now at +6% year-to-date in dollar terms.

2. Between the 4 hyperscalers, forecasts of their capital expenditures for this fiscal year have doubled since late 2022 to a whopping $317 billion.

“We don’t know if it’s possible for so many companies to spend so much on a developing technology and all make great returns. Of course it depends on the goal. If it’s a winner-take-all race to be the first to “superintelligence,” then maybe. However, if it’s an exercise in grinding out profits by spending wisely, it might be a different proposition. “

Source: WSJ

3. Wall Street forecasts have been on a rollercoaster this year.

4. The Euro was down against the dollar on perception that the trade deal will hurt the European economy.

Former Bank Of Japan Deputy Governor Hiroshi Nakaso said the U.S. dollar will remain a key global currency but “cracks” appearing in its status will prod investors to continue diversifying into other currencies.

5. Astrazeneca breaking out.

The AZN equity story has transitioned from earnings upgrades to pipeline de-risking events and the pipeline continues to be underestimated by street. AZN shares currently trade at c.16x P/E, with a superior growth (11% versus 6% for peers) and pipeline.

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