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July 13, 2026

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Apple’s decision to sue OpenAI marks one of the biggest legal confrontations yet in the artificial intelligence industry, transforming what was once a strategic partnership into an increasingly bitter rivalry.

The iPhone maker alleges that OpenAI systematically acquired Apple trade secrets to accelerate its ambitions in AI hardware, accusing the ChatGPT creator of using former employees, recruiting tactics, and supplier relationships to gain access to confidential information.

The lawsuit filed on Friday comes at a time when the battle in artificial intelligence is expanding beyond software models into consumer devices, making hardware the next major competitive frontier.

Here is a closer look at what Apple’s lawsuit is about, why it matters, and what it could mean for the AI industry.

Why has Apple sued OpenAI?

Apple’s complaint alleges that OpenAI orchestrated a broad campaign to obtain confidential information relating to Apple’s unreleased technologies, manufacturing processes, and products.

According to the lawsuit, OpenAI relied heavily on former Apple employees and supplier relationships to accelerate development of its own hardware products.

“Recently, significant evidence has emerged suggesting individuals employed by OpenAI wrongfully took Apple’s secret and confidential information regarding our unreleased technologies, processes, and products,” an Apple spokesperson said.

OpenAI has denied the allegations.

“We have no interest in other companies’ trade secrets,” OpenAI spokesperson Drew Pusateri said.

“We remain focused on building innovative technology that empowers people everywhere.”

Apple is seeking a court order preventing OpenAI from possessing or using its confidential information and wants the AI company to return any Apple intellectual property it may possess.

How did two partners become rivals?

The lawsuit represents a remarkable reversal in the relationship between the two companies.

In 2024, Apple announced a major partnership with OpenAI that integrated ChatGPT into iPhones, iPads, and Macs as part of its Apple Intelligence initiative.

That alliance, however, has steadily weakened.

Last month, Apple unveiled a revamped Siri powered by Google’s Gemini AI model rather than ChatGPT, signalling a shift in its AI strategy.

Meanwhile, OpenAI has increasingly moved toward building its own consumer hardware ecosystem.

The turning point came when OpenAI agreed to acquire io Products, the hardware startup founded by legendary former Apple designer Jony Ive, in a deal valued at $6.4 billion.

The acquisition made clear that OpenAI intended to compete directly in hardware rather than simply provide AI software.

“OpenAI’s nascent hardware business now rests on the shakiest of foundations, rotten to its core by its illegal reliance on misappropriated trade secrets,” Apple said in its complaint.

Which former employees are at the centre of the case?

Much of Apple’s complaint focuses on former executives who later joined OpenAI.

Among those named is Tang Tan, OpenAI’s chief hardware officer and a former Apple vice president.

Apple alleges Tan directed Apple employees interviewing with OpenAI to disclose confidential information.

“He has directed job candidates still working for Apple to bring ‘actual parts’ from Apple to their interviews for ‘show and tell’ sessions in which he and his team at OpenAI can elicit still more Apple confidential information,” Apple alleged.

The lawsuit also names former Apple employee Chang Liu, alleging he stole an Apple laptop before joining OpenAI.

According to the lawsuit, Liu allegedly left Apple with three key assets: a company-issued MacBook that was never returned, an ongoing relationship with an Apple employee who continued sharing internal information, and, most significantly, knowledge of a software flaw that gave him continued access to Apple’s internal file servers.

“LOL, I found out I can access the (network storage), so funny,” Liu allegedly wrote to his former Apple colleague, Alyssa Peng, Bloomberg reported.

Liu then used that access to download presentations, hardware designs, manufacturing details and testing procedures – while already working at OpenAI, Apple alleges.

According to Apple, OpenAI also coached departing employees on how to avoid Apple’s internal security procedures when leaving the company.

The complaint notes that more than 400 former Apple employees now work at OpenAI.

“That OpenAI now employs people who were once entrusted with Apple’s trade secrets does not entitle OpenAI to use that information to jumpstart its hardware efforts,” Apple wrote.

What trade secrets does Apple claim were stolen?

The complaint goes beyond employee recruitment.

Apple alleges OpenAI sought confidential information from Apple’s manufacturing partners and suppliers.

One allegation claims OpenAI asked a hardware supplier to reproduce a proprietary metal-finishing technique developed by Apple while leading the supplier to believe Apple had authorised the work.

The company also claims that Tang Tan carried confidential information relating to Apple suppliers after leaving the company.

Apple said it first raised concerns with OpenAI in February, writing to the company about what it believed was the misuse of confidential information.

According to the complaint, OpenAI did not respond.

Why is hardware becoming so important in AI?

The lawsuit reflects a broader shift underway in artificial intelligence.

While AI companies initially competed by building increasingly powerful language models, attention is now turning toward dedicated AI devices that could reduce dependence on smartphones.

OpenAI’s acquisition of Jony Ive’s startup signalled ambitions to create new categories of AI hardware.

For Apple, whose business remains centred around the iPhone, such efforts represent a potential long-term competitive threat.

“Apple sees OpenAI moving from partner to potential rival, while OpenAI is trying to reduce its dependence on the iPhone and build a direct relationship with consumers,” PP Foresight analyst Paolo Pescatore told Reuters.

“Even if the allegations are not proven, the lawsuit could delay OpenAI’s hardware ambitions and further weaken what is already becoming an increasingly fragile partnership.”

Does Apple have a history of such lawsuits?

Yes.

Apple has previously taken legal action against former employees whom it believed misused confidential information.

In 2019, it sued former chief chip architect Gerard Williams III after he left to establish semiconductor startup Nuvia.

Apple eventually dropped that case in 2023.

The current lawsuit also recalls one of the company’s most famous legal battles under Steve Jobs.

Jobs famously described Google’s Android operating system as “a stolen product” and vowed to wage “thermonuclear war” against it.

According to accounts published at the time, Jobs said he would “spend every penny of Apple’s $40 billion in the bank, to right this wrong.”

Some observers see Apple’s action against OpenAI as a similar attempt to slow an emerging competitor before it can reshape the consumer technology landscape.

What legal challenges does Apple face?

Legal experts say Apple has raised serious allegations, but proving them may not be straightforward.

Mark Lemley, a professor at Stanford Law School, said the case could become significant if Apple can demonstrate that confidential documents were actually taken and used.

“But if Apple’s claims that the employees took confidential documents with them — and that OpenAI is using those documents — are true, that is a problem for OpenAI,” Lemley said in a Reuters report.

At the same time, he noted that hiring former employees is not illegal in California, where employment laws have historically encouraged labour mobility.

Rutgers Law School professor Camilla Hrdy said the dispute could prove unusually complex because most previous AI trade-secret cases have focused on software rather than hardware.

“These trade secret lawsuits are frequently brought in the tech space, and we usually learn much, much more as the case develops. OpenAI is not a defendant that can’t afford to defend itself,” Hrdy said.

Regardless of the eventual outcome, the lawsuit underscores how the AI race is rapidly expanding beyond algorithms into hardware, manufacturing and intellectual property, making the competition between technology giants increasingly resemble the smartphone wars that defined the previous decade.

The post Why Apple sued OpenAI: everything to know about the AI trade secrets lawsuit appeared first on Invezz

Goldman Sachs stock has pulled back more than 6% from its year-to-date high and has gradually formed a risky chart pattern ahead of its second-quarter earnings on Tuesday. The stock was trading at $1,055 and appears vulnerable to further downside despite expectations for strong earnings.

Goldman Sachs stock is at risk of falling after earnings

The GS stock price has pulled back in the past few weeks, moving from a high of $1,125 on June 15 to $1,055. It has formed a head-and-shoulders pattern, a common bearish reversal sign in technical analysis. Its head is at $1,125, while the right and left shoulders are at $1,100. The neckline is at $1,000. 

The stock has also formed what looks like a diamond reversal pattern, which normally leads to a bearish breakout over time. At the same time, the two lines of the MACD indicator formed a bearish crossover and are pointing downwards.

Therefore, there is a risk that the stock will retreat in the coming weeks, potentially to the neckline at $1,000. The bearish outlook will become invalid if it jumps above the head section of $1,125.

GS stock chart | Source: TradingView

Goldman Sachs expected to publish strong results

On the positive side, all signs are that the company will publish strong financial results on Tuesday this week.

All indications are that its business is having one of its best years. For example, data compiled by the Wall Street Journal shows that Goldman Sachs has advised M&A deals worth over $1.2 trillion this year, much higher than JPMorgan’s $843 billion.

Goldman Sachs has also led as the top bookrunner in IPOs this year, with the value of deals rising to over $67.9 billion, higher than last year’s $35 billion. Dealogic estimates that its investment banking revenue jumped to over $5.7 billion, higher than last year’s $4.1 billion. 

The most recent results showed that its business boomed in the first quarter, with the Global Banking and Markets division rising by 11% to over $12.7 billion. Its asset and wealth management revenue rose by 10% to $4 billion.

READ MORE: Goldman Sachs stock has soared: here’s why it has more gains ahead

This growth likely continued growing in the second quarter as its investment banking and trading businesses soaring. Its investment banking revenue is benefiting from major deals, including the recent SpaceX IPO and the recent SK Hynix listing. It also took part in the $67 billion deal between NextEra and Dominion Energy.

Trading has also continued booming this year, helped by the US-Iran war that has led to substantial market volatility. 

Analysts anticipate that the upcoming results will show that its business continued to boom. The average estimate is that its revenue rose by 12.50% to $16.4 billion, while its guidance for the third quarter will be $16 billion. Goldman has a long history of doing better than expected.

Analysts have a bullish outlook for the company. Bank of America boosted its target from $1,050 to $11,50, while UBS hiked from $940 to $1,120. BMO Capital Markets and Morgan Stanley hiked to $1,070 and $1,099. 

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The Roundhill Memory ETF (DRAM) slumped by over 8% in the pre-market session as the volatility in the industry escalated. It dropped to $937, down by 25% from its highest point this year. 

SK Hynix stock crashed in South Korea

DRAM ETF is a relatively new fund that was launched in April to give investors an exposure to the booming memory industry. It is made up of the biggest names in the sector, including South Korea’s Samsung and SK Hynix. 

DRAM has become one of the most successful ETF launches ever, with its assets under management rising to over $24 billion in three months. This surge happened as demand for memory products continued rising amid the ongoing artificial intelligence boom.

The ETF is slumping today after SK Hynix stock tumbled by over 15% in South Korea. It was its worst single-day performance on record and is a sign that investors are booking profits after its recent gains as it moved towards the US debut.

Samsung Electronics stock dropped by over 10%, as sentiment in the industry waned. The same trend happened in Japan, where Kioxia Holdings tumbled by over 12%.

Similarly, most American memory stocks are in a freefall, with Micron falling by 4% in the premarket. SanDisk stock plunged by over 4.6%, while Seagate Technology fell by 3.45%. Western Digital fell by 4.7%, with most of these names being down by over 10% from their peak this year.

DRAM is highly exposed to the crisis because of its composition. According to its website, Samsung accounts for 25.55% of the fund, while Micron Technology and SK Hynix have 24.8% and 23.60%, respectively. These companies account for about 74% of the fund, with another 14% being in an open-ended money market fund. 

Memory companies are still growing

Still, fundamentals of these companies are substantially strong, with most of them reporting strong revenue and profitability growth. In its recent earnings report, Micron said that its revenue jumped by 300% to over $40 billion, with the management expecting the fiscal fourth quarter revenue to hit $50 billion. 

Samsung Electronics also published strong numbers last week, with its revenues and profits soaring in the last quarter. Its operating profit soared to $58.5 billion, while revenue hit $112 billion.

Other memory companies are expected to publish strong financial results in the coming weeks. For example, Yahoo Finance data shows that Micron’s revenue is expected to come in at $50.76 billion, up by 348% YoY. Its annual revenue is expected to jump by 246% to $129 billion.

Sandisk’s annual revenue is expected to hit $20 billion, up by 168% YoY, while Western Digital’s figure will hit over $12 .87 billion. Their margins are also expected to jump because of the rising memory prices in the US and other countries.

Therefore, these stocks are falling because of the rising fear that memory spending is nearing its peak. Also, traders are starting to book profits since most of these shares have more than doubled this year.

DRAM ETF technicals point to more weakness

DRAM chart | Source: TradingView

The four-hour chart shows that DRAM has slumped in the past few days, and this trend may continue in the near term. It formed a head-and-shoulders pattern, a common bearish reversal sign in technical analysis. It has moved below the neckline of this pattern and the 50-period moving average.

Therefore, the fund will likely continue falling, potentially to the psychological level of $50. A move below that level will point to more downside, potentially to $45.

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The Philadelphia Stock Exchange Semiconductor Index (SOX) is exhibiting “severe” technical turbulence, signaling a potential drawdown of up to 17%, according to investment bank BTIG.

While the group maintains a staggering year-to-date advance exceeding 80%, recent session-to-session churning indicates that institutional exhaustion may be setting in.

As momentum shifts from structural tailwinds to tactical vulnerability – investors face a “critical inflection point”.

The underlying metrics suggest that the semiconductor stocks rally is temporarily decoupling from historical baseline stability.

Technical warnings and new supply

SK Hynix’s recent US initial public offering (IPO) presents a pivotal gauge for the broader sector.

According to experts at both Morgan Stanley and UBS, this massive influx of new equity creates an immediate case for sector downside.

And the supply shock coincides with BTIG’s technical warnings as well.

Chief market technician Jonathan Krinsky notes that while the SOX index closed above its 50-day and 200-day moving averages (MAs), it remains trapped below its 20-day MA.

This fragmentation historically precedes severe market drawdowns, he argued in his latest research report.

“While this was too early of a signal in ’99, it had ominous outcomes in ’95, ’97, ’00, ‘20, and ’24 preceding -17% or worse drawdowns.”

Extreme near-term volatility and exhaustion

The second warning sign stems from the rapid, unstable price fluctuations – Krinsky referred to as “fluttering” – following the index’s massive rally.

Specifically, SOX has experienced notable swings of “3% or more” on 15 separate occasions over the last 30 trading days.

The BTIG strategist sees this specific combination of extreme high-frequency volatility and short-term resistance as a clear signal of institutional exhaustion, indicating that the index is losing vital near-term momentum required to sustain its massive rally.

This erratic, hyper-volatile behavior underscores a severe tug-of-war between remaining bulls and aggressive profit-takers, leaving the overextended sector highly vulnerable to sudden, systemic selling pressure if key technical support levels ultimately fail to hold.

What to expect from semiconductor stocks longer term?

Despite these immediate technical red flags and looming supply shocks, the broader outlook for semiconductor stocks remains a subject of intense Wall Street debate.

Analysts at Jefferies point out that while small-cap chip stock gains have outpaced even the frantic run-up to the 2000 dot-com crash, subsequent historical performance following such massive leaps has traditionally stayed quite resilient.

Their data shows average three-month and six-month forward returns mapping out healthy gains of 7.0% and 15.4%, respectively.

Ultimately, whether the current turbulence signals a devastating 17% correction or merely a healthy, short-term consolidation before the next leg up depends entirely on the sector’s structural earnings power.

The upcoming quarterly earnings reports will serve as the ultimate litmus test, determining if robust AI demand can fundamentally override these mounting technical warning signs.

The post BTIG says this semiconductor stocks index is flashing warning signs appeared first on Invezz

Wall Street’s main indexes opened lower on Monday as renewed tensions between the United States and Iran pushed oil prices higher, while a broad selloff in semiconductor stocks added to pressure ahead of a busy week of corporate earnings and economic data.

Dow Jones Industrial Average bucked the trend and opened higher by about 122 points, or 0.23%.

The S&P 500 fell 0.17%, while the Nasdaq Composite declined around 0.61%, with technology stocks leading losses.

The cautious mood followed another escalation in the Middle East over the weekend, with investors also preparing for second-quarter earnings reports from major US banks and key inflation data that could shape expectations for Federal Reserve policy.

Oil rises as US-Iran conflict escalates

Geopolitical concerns intensified after the United States and Iran exchanged attacks over the weekend.

Tehran said it had closed the Strait of Hormuz, a key shipping route for global energy supplies, although President Donald Trump disputed the claim on Sunday, saying the waterway remained open to commercial traffic.

The latest developments undermined an interim agreement reached last month that had sought to reopen the strait and de-escalate the conflict following weeks of negotiations.

Oil prices climbed as markets assessed the risks to global energy supplies.

West Texas Intermediate crude rose about 3% to $73.83 per barrel after briefly touching $75.08 overnight.

Brent crude also gained roughly 3% to $78.52 after reaching as high as $79.80.

The increase in crude prices revived concerns that higher energy costs could complicate the inflation outlook just as investors await fresh US consumer price data.

Chip stocks retreat after SK Hynix debut

Semiconductor stocks came under renewed pressure after South Korean memory-chip maker SK Hynix’s blockbuster Nasdaq debut on Friday.

US-listed shares of SK Hynix fell about 7% in trading after surging 13% on their first trading day.

The weakness spread across the semiconductor sector.

Micron Technology declined roughly 6.4%, while Western Digital, Seagate Technology and Sandisk each fell between 4% and 7%.

Advanced Micro Devices and Intel also traded lower.

The iShares Semiconductor ETF dropped more than 3%, reflecting broad weakness across chipmakers despite the sector’s strong gains earlier this year.

Earnings and inflation data take center stage

Major Wall Street banks including JPMorgan Chase, Goldman Sachs, Morgan Stanley, Bank of America, Citigroup and Wells Fargo are scheduled to report quarterly results this week.

Netflix, Johnson & Johnson, General Electric and UnitedHealth are also due to release earnings later in the week.

According to LSEG I/B/E/S, S&P 500 companies are expected to report second-quarter earnings growth of 23.7% from a year earlier.

FactSet estimates similarly point to profit growth of more than 23%, underscoring elevated expectations heading into the reporting season.

Markets will also focus on Tuesday’s US consumer price index report, which could influence the Federal Reserve’s interest-rate outlook.

Fed Chair Kevin Warsh is scheduled to deliver his first monetary policy testimony before Congress on Tuesday, while Fed Governor Christopher Waller is expected to speak later on Monday.

Despite Monday’s pullback, the S&P 500 remains up more than 10% for the year and sits less than 1% below its early-June record closing high after posting a second consecutive weekly gain last week.

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West Texas Intermediate (WTI) and Brent crude oil benchmarks rose slightly on Hyperliquid as tensions between the US and Iran escalated. WTI rose to $73, with its 24-hour volume and open interest rising to $113 million and $222 million, respectively. Brent rose to $78, with a trading volume of $63 million. 

Iran closes Strait of Hormuz, triggering US strikes

WTI and Brent benchmarks rose slightly as tensions between the US and Iran escalated. In a statement on Saturday, Iranian officials said that they had closed the Strait of Hormuz, blaming the US for violating the ceasefire agreement. In a statement in Turkey, Trump said that the ceasefire was “over.”

The US military, through CENTCOM, said that it had launched more strikes against Iranian targets overnight, with Iranian officials vowing to respond. In the last attacks, Iran launched retaliatory attacks on US military sites in Kuwait and Bahrain.

https://twitter.com/CENTCOM/status/2076089130857951463

Recent data shows that traffic through the Strait of Hormuz has faded in the past few days. Tankers are afraid of being attacked, which would lead to losses worth millions of dollars. Also, insurers are afraid of offering services to ships crossing the Strait.

These developments are happening a day after Trump warned Iran against assassinating him. In a Truth Social post, Trump said that Iran would be destroyed if it did that. This statement came after the US received intelligence that Iran was considering ways to assassinate him. 

In a statement on Saturday, Iran’s Mojtaba Khamenei said that Iran would retaliate against the killing of his father and other Iranians, including the school girls in Minab. 

Therefore, there is a risk that the kinetic activity between the US and Iran will resume, affecting oil supplies at a time when inventories are still falling.

Russia and Ukraine war

Meanwhile, crude oil prices are reacting to the ongoing developments in Russia, where Ukraine has continued to attack oil and gas infrastructure in the country. It has already attacked some of the biggest Russian refineries, leading to shortages across the country. Ukraine has also attacked Russian oil tankers at sea.

Therefore, there is a risk that Russian oil supplies to the global market will be disrupted in the near future. All these events mean that the oil glut that some analysts were expecting will be delayed. 

Brent crude oil price technical analysis

Brent crude oil prices chart | Source: TradingView

The daily chart shows that Brent crude oil price bottomed at $70.20 earlier this month as investors reflected on the situation between the US and Iran. It then bounced back to $79.5 as the two sides restarted their strikes, and then pulled back to $75.22. 

Brent then rose to $78 on Hyperliquid on Sunday as the two sides launched strikes. It is attempting to rise above the key resistance level of $79.5, which it reached last week.

It remains slightly below the 61.8% Fibonacci Retracement level and the 50-day Exponential Moving Average (EMA). Also, the Supertrend indicator is still red, a sign that bears remain in control.

Therefore, the price will likely be highly volatile depending on how the Iranian situation evolves. An escalation, which is happening, may push oil prices to $80 and above in the near term.

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The Kospi Index is stuck in a local bear market after falling 21% from its year-to-date high. It ended the week at 7,475, down sharply from the year-to-date high of 9,387. This article highlights some of the top catalysts for South Korean stocks this week.

Kospi Index chart | Source: TradingView

Kospi Index to react to SK Hynix US IPO

The Kospi Index will react to last Friday’s SK Hynix US IPO that saw it raise over $26.5 billion. Its stock jumped by over 13% on its first day as brokers rushed to fill pre-orders. 

The IPO happened when South Korean stocks were closed, meaning that investors in the country will have a chance to respond to the listing. 

A key risk for SK Hynix is that most recently-launched IPOs normally jump initially and then retreat shortly after that. This happened with most IPOs, with SpaceX stock falling to a record low. Other companies like Circle, Figma, and Klarna have all plunged after the initial surge faded. 

The Kospi Index will be highly volatile in the new week as we have seen in the past few weeks. It has been normal for the index to jump and retreat by as much as 10% within a session, and this trend will likely continue this week.

South Korean Central Bank decision

The Kospi Index will react to the upcoming South Korean Central Bank interest rate decision, which will happen on Thursday this week. 

Top analysts expect that the central bank will hike interest rates by 0.25% to 3%. This hike will be because of its attempts to boost the South Korean won, which plunged to a record low against the US dollar recently. 

The rising optimism that the central bank will hike interest rates explains why the USD/KRW pair has plunged in the past few days. It has slumped from a high of 1,560 on June 5 to the current 1,500. Technically, the pair has formed a double-top pattern, pointing to more downside in the near term. 

South Korea’s central bank is concerned about inflation as semiconductor companies boost their bonuses to workers. Recent data showed that the country’s inflation jumped to the highest level in over 2 years. As such, the rate hike is expected to slow the economy down and put inflation in check. A more hawkish central bank may affect the performance of South Korean stocks and fuel volatility.

Key South Korean macro data

The Kospi Index will react to the upcoming macro data from South Korea. For example, the country will publish the latest import and export price index reports on Wednesday. 

It will also release the June import and export data on the same day. Economists expect the data to show that exports surged by 70.9% in June, while imports rose by 30%, leading to a trade surplus of over 36 billion KRW. These numbers will provide more information about the state of the South Korean economy.

US and Iran tensions

The Kospi Index will also react to the ongoing developments between the US and Iran. The two sides restarted their fighting during the weekend, with the US launching attacks against several Iranian targets. Trump has already declared the ceasefire to be over, and warned Iran of destruction if it killed him.

Crude oil priceshave already jumped on Hyperliquid, and the trend may continue this week, affecting the South Korean economy. The country imports most of its oil from the Middle East. 

Separately, the index will also react to key earnings from the biggest American banking groups, including Goldman Sachs and JPMorgan.

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The S&P 500 Index continued rising and neared its all-time high on Friday as some big tech companies like Nvidia and AMD rebounded. It ended the week at 7,575, with its perpetual futures on Hyperliquid ticking downwards today. This article explains some of the top catalysts for the SPX Index and key ETFs like VOO and SPY.

S&P 500 Index to react to earnings season

The biggest catalyst for the SPX Index will be the upcoming earnings season, which kicks off on Tuesday when five of the biggest banks release their financial results. Five banks worth almost $2 trillion will release their numbers on that day. 

They include companies like JPMorgan, Bank of America, Goldman Sachs, Citigroup, and Wells Fargo. A day later, more big banks like Morgan Stanley, Bank of New York, and PNC will publish their earnings.

In addition to these banks, large companies like Netflix, UnitedHealth, General Electric Aerospace, Intuitive Surgical, and BlackRock will release their financial results this week. These results will provide more information on how companies performed during the US-Iran war. 

Wall Street analysts predict that the earnings season will be successful, with the average growth being 23.2%. In most cases, earnings are usually higher than what analysts expect. If this trend continues, there is a likelihood that earnings growth will be over 30%.

US consumer inflation data

The S&P 500 Index, VOO, and SPY ETFs will react to the upcoming US consumer price index (CPI) data on Tuesday. Economists believe that consumer prices softened a bit last month as gasoline prices fell modestly. The average gasoline price has dropped to $3.8820 from last month’s $4.1290. 

While gasoline prices have dropped, service inflation has remained at an elevated in the past few months. For example, utility bills have risen recently because of the artificial intelligence (AI) boom.

The average estimate is that the headline Consumer Price Index (CPI) dropped by 0.1% in June after rising by 0.5% in the previous month. Core CPI, which excludes the volatile food and energy prices, is expected to come in at 0.3%. The US will publish the Producer Price Index (PPI) data a day after that.

These inflation numbers will help to determine the next phase of the Federal Reserve. A higher-than-expected inflation report would push the Federal Reserve to maintain a more hawkish tone later this year.

FOMC minutes released recently suggested that officials debated the pros and cons of hiking interest rates in the coming months. Some officials supported hiking rates later this year, while other supported cutting rates if inflation started moving downwards.

US-Iran tensions

The other key catalyst for the S&P 500 Index and its top ETFs like SPY and VOO will be the new developments from Iran. The US launched the third phase of strikes overnight, attacking key military targets. 

This happened after Iran announced that it had closed the Strait of Hormuz. As a result, crude oil prices rose on Hyperliquid. Signs of an escalation between the two sides will lead to more volatility in the stock market. 

AI jitters to move US stocks

The US stock market will react to the new developments in the AI industry. Last Friday, stocks jumped after South Korea’s SK Hynix launched the biggest IPO of a foreign company in the United States after Alibaba. 

Another important AI news came over the weekend when Apple announced a major lawsuit against OpenAI, alleging that the latter stole its trade secrets in its hardware push. It is unclear how this lawsuit will affect the stock market this week, but some OpenAI-related stocks like Nvidia and Broadcom may move.

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