Morning Bid: Churning chips

Morning Bid: Churning chips By Mike Dolan Thu, July 2, 2026 at 12:44 PM GMT+2 4 min read By Mike Dolan July 2 (Reuters) - What matters in U. S. and global markets today By Mike Dolan, Editor-at-Large, Finance and Markets The U.

S. jobs report will clearly dominate the day ahead for markets, but there's been a hefty pullback in red-hot chip stocks around the world as the second half of the year ‌gets underway. Given the shortened week, quarter-end trading quirks and the looming payrolls report, it may be unwise to read too much into this week's market ‌moves, but it does appear there's some degree of profit-taking and portfolio shuffling going on.

I'll get into that and more below. But first, check out my latest column on the U. S.

economy's seemingly unstoppable expansion over the ​past 17 years and what it's meant for the equity bull market. And listen to the latest episode of the Morning Bid daily podcast, where I dig into June's expected job numbers. Subscribe to hear Reuters journalists discuss the biggest news in markets and finance seven days a week.

Finally, Morning Bid Weekend will be off tomorrow for the Independence Day holiday. CHURNING CHIPS The U. S.

SOX chip index fell back about 6% on Wednesday with no obvious trigger, even though the wider S&P 500 ended flat and the equal-weighted index hit new highs. Asia stocks took ‌their lead from the SOX today, with sizeable declines in ⁠big chip and tech equipment makers in Seoul and Tokyo. Meta, which had lost about 15% in the first half of the year, was an outlier stateside, rising nearly 9% on Wednesday on a report that it was building out its cloud business and planned to sell ⁠excess AI computing capacity.

Also on the tech front, the FT reported on Thursday that OpenAI would offer the U. S. government a 5% stake.

Meantime, today's payrolls report is expected to show another brisk gain of 110,000 jobs last month - well above the so-called breakeven rate needed to keep the unemployment rate steady. There was a slight miss in ADP's private sector jobs report on Wednesday, ​but ​not enough to shift any Federal Reserve expectations. Fed Chair Kevin Warsh was equivocal in his take on ​things in Portugal on Wednesday, insisting the central bank was committed ‌to getting inflation back to 2% but noting there had been improvement in the inflation picture in recent weeks.

Although Fed futures still see a rate hike by October, crude oil prices continue to decline amid more positive noises about talks between U. S. and Iranian officials this week.

Brent crude was trading at around $71 per barrel early on Thursday. And in Europe there was good news on the inflation front on Wednesday, as euro zone headline CPI came in at 2. 8%, well below expectations for 3%.

That offers some hope that the ECB can avoid further rate hikes now that energy prices are retreating. Story Continues Elsewhere, the yen jumped sharply from Wednesday's 40-year low, as nerves about possible Bank of Japan intervention ‌to support it jangled. Reuters reported that Japan's authorities are looking to adopt a more opportunistic currency ​intervention strategy, aimed at ambushing speculative bets rather than telegraphing plans in advance or drawing lines in the ​sand.

Chart of the day If AI is going to destroy job creation, it's not ​happening yet. The U. S.

economy posted a third straight month of strong job gains in May and another 100,000 or more are expected ‌to be recorded for June when the monthly employment report is ​released later on Thursday. Employment gains have averaged 188,000 ​jobs per month over the past three months, nearly triple the comparable figure for the same period in 2025, and about 150,000 more than most estimates of the so-called breakeven rate that keeps the unemployment rate steady. Today's events to watch • U.

S. June nonfarm payrolls (8:30 a. m.

EDT), weekly jobless claims (8:30 a. m. EDT), May factory ​orders (10 a.

m. EDT) • San Francisco Fed's Mary Daly speaks Want to ‌receive the Morning Bid in your inbox every weekday morning? Sign up for the newsletter here.

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