US equity futures are flat on the final trading session of the week, with Tech lagging, as traders hold off on big bets ahead of the weekend, with the fragile truce in the Middle East keeping geopolitical risk front of mind. Overnight, the US said Iran talks will continue, a positive step amid the recent escalation near the Strait of Hormuz (then again the market never reacted negatively to the latest strikes in the first place). As of 7:45am ET, S&P futures are flat and Nasdaq futures are down 0.2%; pre-market, Mag 7 stocks are mixed: META +1.8%, MSFT +0.9%, while NVDA and AAPL are down 0.6% and 0.4%, respectively. Notably, META has been outperforming since the announcement of its Muse Spark AI model and its strategy for the cloud business. SemiAnalysis, whose "unbiased", often wrong but never in doubt, views at some point be investigated by a regulator, also struck a positive note on META’s AI development (here). Bond yields are 1–2 bp lower, and USD is mostly unchanged. Commodities are mixed: WTI is down 0.2%; base metals are higher, while precious metals are mostly lower. The US economic data calendar empty for the session. Next week includes June CPI, PPI data. Fed calendar empty for the session. In premarket trading, Magnificent 7 stocks are mixed with Meta rising 3% after research firm SemiAnalysis posted a positive report on the social media giant’s AI compute business (Microsoft +0.4%, Amazon unchanged, Alphabet +0.1%, Apple -0.4%, Tesla unchanged, Nvidia -0.4%).CCC Intelligent Solutions (CCC) jumps 9% after Reuters reports that the insurance software company is exploring a sale.Circle Internet Group (CRCL) gains 13% after the stablecoin issuer received approval from the US Comptroller of the Currency to establish “First National Digital Currency Bank, N.A.,” a national trust bank that will offer digital asset services.Delta Air Lines (DAL) slips 2.8% after the airline posted second quarter results.EquipmentShare.com (EQPT) gains 13% after the company announced a $500 million share buyback.Fermi (FRMI ) down -17% after offering $350 million in convertible senior notesTwilio (TWLO) climbs 2% as Stifel upgrades to buy on the company’s potential to capitalize on the current AI cycle.WD-40 (WDFC) rises 14% after the lubricant spray maker boosted its net sales forecast for the full year.In other AI news, JPMorgan has built an array of AI-powered investing agents that beat 60/40 portfolio in back-tests. OpenAI and Google confirmed they have been supplying AI services to Singapore-based subsidiaries of Alibaba, Baidu and Tencent, the Financial Times reports. Netflix is said to be considering steps to deal with signs of declining subscriber engagement, according to the WSJ. Bayer sold a minority stake in its contraceptives business to Apollo for €3 billion ($3.4 billion) and will use the funds raised to help cover its ballooning litigation costs tied to the herbicide Roundup. Polymarket is seeking regulatory approval to offer margin trading in the US, which would let users bet on events with less capital upfront.We end a week characterized by thematic rotations, signs of a summer trading lull and low volatility at the index level. Brent crude traded near $76.50 a barrel, swinging between small gains and losses after a volatile stretch. Talks between the US and Iran are continuing despite days of fighting that drove a steep drop in traffic through the Strait of Hormuz. The risk of further escalation is expected to keep investors cautious as they close out the week.“Over the weekend, discussions between the US and Iran are expected to continue,” said David Manso, chief investment officer at CaixaBank AM. “Oil prices could provide a useful gauge of investor sentiment and expectations regarding the evolution of the situation.”Yet away from geopolitics, things are about to get busier soon, with Tuesday’s blitz of five major US bank results heralding the start of the earnings season. And speaking of rotation, Lilian Chovin at Coutts in London, notes that the firm has moved a bit underweight US equities. “Other regions are probably better placed right now to navigate the coming few months. Obviously by reducing our US exposure, we have reduced our exposure to tech mega cap.” The Coutts team remains positive on the AI theme, he explains. “It’s more nuanced than people selling tech to go into defensive sectors. We’ve seen a rotation within tech, caused by some noise around semiconductors.” After an unprecedented rally in chipmakers and other AI buildout stocks helped markets shrug off higher oil prices and elevated bond yields, the bar is now high for companies to justify their lofty valuations. For hyperscalers, the onus is on proving that the spending can generate strong returns.“What remains to be confirmed is whether growth can hold up despite that pressure, with the AI capex cycle continuing to support investment, revenues and earnings,” said Florian Ielpo, head of macro at Lombard Odier Investment Managers. “Expectations are high, but the real test is whether earnings can keep validating the expansion story.”This morning another company capitalized on the chip bubble when SK Hynix raised $26.5 billion in its ADR offering, the largest ever US first-time share sale by a foreign company. The company sold 177.9 million ADRs for $149 apiece, each equivalent to a 10th of a Seoul-traded common share. Hynix’s US debut is set to spur a wave of leveraged ETF product launches. Analysts have upgraded S&P 500 earnings estimates ahead of the second-quarter reporting season, setting the bar high in “an atypical move,” according to HSBC strategists. The Street now expect profits to rise 22% from a year earlier, the highest in the post-pandemic period. Meanwhile, with Q2 reports due shortly, an interesting set-up is emerging between earnings season expectations and headline risk, notes Bloomberg’s equity derivatives specialist Christian Dass. Persistently low implied correlation leaves the VIX vulnerable to a sharp repricing if markets become increasingly driven by macro headlines rather than stock specific fundamentals.In politics, Trump fired two Democratic members of the US Election Assistance Commission, while the Republican member resigned. Graham Platner’s exit from the Maine Senate race has set off a scramble to find a replacement to take on Republican incumbent Senator Susan Collins, with at least six Democrats entering the field.In other assets, carry trades are seeing the most compelling backdrop in more than two decades, according to Goldman Sachs, while an unprecedented divergence in the oil-market crack spread gauge are prompting Vanguard to buy insurance against stickier-than-expected US inflation. Trade during the European session has been indecisive and non-committal alongside a particularly slow news cycle. The Stoxx 600 has oscillated around the unchanged mark: tech and energy sectors are the worst performers, while telecoms and miners are the biggest gainers. Here are some of the biggest movers on Friday:EasyJet shares jump as much as 15% after the budget airline received a fresh bid from private equity firm Apollo that beats a rival proposal from Castlelake. The shares remain below both offer prices.Vodafone shares soar as much as 14% after its biggest shareholder Emirates Telecommunications Group agreed to sell its entire 16% stake in the firm to a vehicle controlled by billionaire Xavier Niel.Voestalpine, Salzgitter and ArcelorMittal rose after JPMorgan upgraded the steel producers. The bank says it expects 2Q reporting to focus on the impact of cuts to EU steel imports and import tariffs effective from July, which have the potential to transfer demand to EU steel producers.EMS-Chemie shares gain as much as 3.5% after it reported better-than-expected first-half sales and profit and raised its net sales forecast for the year.Hays shares rise as much as 13% after the recruitment company reported stronger-than-expected fourth-quarter fees and forecast full 2026 profit to be at top end of the consensus range.St James’s Place shares fall as much as 7% after Financial News reported that one of the wealth manager’s largest advice firms has decided to exit the group, spotlighting ongoing retention troubles.Duerr shares fall as much as 4% as Berenberg downgrades the German stock to hold from buy and slashes its price target almost in half, citing dependency to automotive original equipment manufacturers.Glenveagh Properties drops as much as 5.1% after being downgraded at Deutsche Bank, as analysts believe the Irish housebuilder is fairly valued following recent gains.Troax shares fall as much as 6.6% after Berenberg downgraded the Swedish maker of machinery parts and warehouse fittings to hold from buy, citing a tough automotive end-market and the likelihood of a slow margin recovery.The mood in Asia was more upbeat with the MSCI APAC index up 0.8%, boosted by a rally in tech shares. Asian stocks climbed, boosted by a rally in tech shares amid optimism ahead of the US listing by South Korean chipmaker SK Hynix. The MSCI Asia Pacific Index jumped as much as 1.7%, the most in a week. Shares of Samsung Electronics and SK Hynix were the top contributors to the benchmark’s advance and led a 5% surge in the Kospi. Japan’s Nikkei 225 was up almost 2%. SK Hynix raised $26.5 billion in its American depositary receipt offering, powering through recent volatility in global semiconductor stocks. Meanwhile, Samsung Electronics’ Executive Chairman Jay Lee is seeking to meet with Nvidia’s Jensen Huang in the US late July to discuss the former’s investment plans in South Korea’s southwest area, according to a media report. Elsewhere, trading in Taiwan was halted as a strong typhoon approached the island. Japan called on its pension funds, which include one of the world’s largest, to invest in domestic assets. Here Are the Most Notable MoversShares of Japanese wafer maker Sumco rallied as much as 15% to hit their upper daily limit after Micron’s plan to invest in Taiwan’s GlobalWafers was seen as a sign of rising demand in the sector.Lenovo’ shares rise as much as 9.2% after Morgan Stanley upgrades the Chinese device maker and more than doubles the price target, citing its ability to pass through higher component costs amid AI-driven demand.Zhipu shares drop as much as 9.7% in Hong Kong, paring a sharp three-day rally, after Goldman initiated coverage at neutral, saying their valuation fairly reflects the competitiveness of the company’s AI models.Mitsubishi Motors shares climbed as much as 17%, the most since December 2024, after the vehicle maker announced a tie-up to produce humanoid robots with a Tokyo-based startup.Fast Retailing shares slipped as much as 3.7%, the most since May 12, after the Uniqlo owner’s 3Q earnings beat was seen as priced inIn FX, the dollar dipped 0.1% in a third straight day of losses. Bonds extended a rebound, with the yield on 10-year Treasuries falling two basis point to 4.54%. The yen outperformed major currencies, rising 0.4% after Japanese Finance Minister Satsuki Katayama said the government wants pension funds to increase investment in domestic assets.In rates, treasuries are slightly richer across the curve following similar price action across European bonds with oil prices steady. US yields are 1bp-2bp lower with curve spreads within a basis point of Thursday’s close, 10-year near 4.535% with bunds and gilts in the sector also about 1.5bp richer on the day. During Asia session, yen and JGBs advanced after Japan’s Finance Minister Satsuki Katayama called on pension funds, including the GPIF, to invest in domestic assets. Long-end JGB yields ended more than 10bp lower. US session has no major scheduled events. IG dollar issuance slate empty so far. Four borrowers priced $2.25b in new US investment-grade bonds Thursday, pushing weekly volume through $51b and more than double forecasts. Issuers paid about 2bps in new issue concessions on deals that were 4.2 times covered.In commodities, Brent crude futures are down 0.5% and around the $76/bbl mark with traders awaiting further directional clues from events in the Middle East. WTI crude oil futures little changed as US and Iran continue talks despite a flare-up in fighting. Precious metals are on the back foot with spot gold and silver down 0.6% and 0.8% respectively. Bitcoin is higher by 1.5%. The US economic data calendar empty for the session. Next week includes June CPI, PPI data. Fed calendar empty for the session. Next week Federal Reserve Chairman Warsh testifies before the House Financial Services and Senate Banking Committees on its Semi-Annual Monetary Policy Report.Market SnapshotTop Overnight NewsUS-Iran negotiations on a permanent peace deal are continuing, according to an American official, despite two days of clashes that threatened to unravel the ceasefire. BBGIsrael shared new intelligence with the U.S. that it said indicated a fresh Iranian plan to kill President Trump, people familiar with the matter said, a finding that would mark an escalation in the war between Washington and Iran. This news that comes just 24 hours after Trump unexpectedly switched back to the old Air Force One for his return flight from the NATO summit in Turkey as a “security precaution” (the New Air Force One doesn’t have the same security features as the old one). Iran for years has vowed openly to retaliate against Trump for the assassination of Qassem Soleimani, who was a top general in the Islamic Revolutionary Guard Corps, in the president’s first term. WSJ The UAE boosted crude production to an all-time high last month, pumping 4.1 million b/d on average in June. IEA Global diesel market faces a significant supply crunch as Russia bans exports due to domestic shortages following Ukraine strikes. FTJapan’s Finance Minister, Satsuki Katayama, sparked a jump in the yen on Friday when she said the government would pursue policies to encourage pension funds to buy more Japanese assets. Japan’s biggest public pension fund will likely ignore the call to boost domestic investment, at least in the short run, because of strict rules governing asset allocation and its public mandate. BBGJapan’s producer prices picked up in June to the fastest pace since early 2023, reinforcing the case for the BOJ to keep hiking rates. BBG