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SoftBank's son says that talking about a bubble would be blasphemy to AI.
Masayoshi Son, founder of SoftBank and CEO Masayoshi Son, told SoftBank shareholders on Wednesday that artificial?intelligence is still in its early stages. Any talk of a bubble would be "an insult to AI." Son?said that calling 'AI' a bubble was blasphemy. It's only the beginning. "The potential of AI will be unlocked." SoftBank's stock price was boosted by Son’s 100% bet on OpenAI, despite investors' doubts about the sustainability of this rally. Son's career has seen many market ups and downs, including the dotcom bubble and the COVID-19 Pandemic when his portfolio was in the "valley the coronavirus". SoftBank has also invested in robotics and is building data centers in the U.S. Son said that his group is seeking to invest. He said that if (TEPCO), joined our group, he would be able to increase the power supply in Japan and bring AI data centres there. Son did not provide any additional information, but said that SoftBank had begun manufacturing robots in its "physical AI factory" and would make an announcement about the matter soon. Son stated, "I believe we are the first company in the world that has robots producing robots on a large scale." Son can use the shareholder meeting to explain his vision of the business and answer questions from retail investors. Son said that SoftBank was a goose that lays golden eggs and returned to this comparison. He said, "Eggs don't lay eggs. The goose lays the egg." "SoftBank Group lays the eggs." He was also upset about the difference between the market capitalisation, which is around?37 trillion ($229 billion), and the assets of the company, which are worth?74 trillion?yen. How long will it take me to persuade you that the goose has done a good job? Son asked. The entrepreneur said that he would lead the company well into his 70s in order to achieve "artificial intelligence," which he defines by being a?10,000-times smarter than humans. Son: "I've become more greedy." I would like to accomplish more in the next 10 or 15 years. I will remain healthy for as long as I am able. Son was asked to nominate a shareholder who called herself "a simple housewife" to the board. She said, "You are a visionary and skilled artist." I would like to see my son become as talented and creative as you. Son replied, "I'll remember that."
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Trump demands investigation into 'gouging of gasoline prices'
Donald Trump, the U.S. president, said that the Department of Justice was to investigate oil companies who had not reduced gasoline prices in line with the falling crude costs. He also accused these 'companies' of "gouging customers". Trump didn't name any companies in the post he made on social media, which was posted after midnight. The White House or the Justice Department (DOJ), which is responsible for the administration of the law, did not respond to an inquiry outside normal business hours. Data showed that the U.S.-Iran diplomatic relationship has resulted in a drop in gasoline prices for Americans. This is the sixth consecutive week of falling gas prices. Trump, however, said that the drop in gasoline prices is?neither sufficient nor proportional to declines in crude costs. "Gasoline Prices better go down much faster than what I am seeing!" Trump's post comes at a time when consumers are concerned about high gasoline prices. At the same time, Trump and his fellow Republicans are fighting to maintain a narrow majority in Congress during November's midterm election. GasBuddy data show that the average price for gasoline in the U.S. is $3.906 per galon as of early Wednesday morning, down by more than 14% since the peak in may. In comparison, the price of crude oil has fallen by 23% over the same time period. The U.S. reached an interim peace agreement with Iran and reopened the Strait of Hormuz through which one-fifth of the global oil supply passed before the war started. Since their 'peak' in March, the?U.S. Crude prices have fallen by about 40%. "The Oil Companies do not drop their prices at the pumps in proportion to the lower prices that they pay for Oil. These prices are falling like a stone! Trump stated in a Truth Social post that customers were being "gouged". "I have ordered the DOJ to begin investigating this immediately." The pump prices are still significantly higher than $2.764 per gallon, which was recorded in January. This was more than a full month before the Iran Conflict began.
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Oil nears four-month low, Asian stocks under pressure
On Wednesday, Asian stocks struggled to find direction as 'crude oil' prices continued their declines near a?four-month low. Analysts warned of renewed volatility due to the stretched AI valuations. MSCI's broadest Asia-Pacific share index outside Japan closed up 0.4%, after swinging between gains and losses. South Korean shares, that plunged 10% in Tuesday's sharpest drop since March, rallied by 3.5%. Japan's Nikkei fell 0.4%, and Taiwan stocks lost 1,9%. Michael McCarthy, a market analyst with Moomoo Securities Australia, said that the price action on markets in the past seven trading days has been alarming. Not only when it fell, but it also rose. When markets move so quickly, either in one direction or the other, this is a sign that there's instability. On Wednesday, oil prices dropped more than 1%, continuing this week's losses, and trading at a level near four-month lows. This was due to signs that additional oil tankers stuck in the Gulf will be moving out of the Strait of Hormuz. The durability of the?agreement remains uncertain. Both the U.S.A. and Iran gave conflicting reports on the terms of their peace agreement, which included key elements like nuclear inspections and the control of the Strait of Hormuz. Yoshitaka Araya, Monex Securities, said that the gap between Washington and Tehran's perceptions "could be a cause of concern in the future". European futures mostly fell, following the lead of Asia. Euro Stoxx futures for the entire region and German DAX were both down 0.3%. FTSE futures fell by 0.67%. U.S. Futures were mostly stable, with S&P E-minis rising by 0.1%, Nasdaq E-minis increasing by 0.2%, and Dow E Minis remaining flat. The yield on the benchmark U.S. 10 year notes dropped 0.6 basis points, to 4.487%. Micron Technology will release its earnings later on Wednesday. This could provide clues about the future of the memory and AI chip sector, after this year's explosive rally. The dollar index rose 0.07% to 101.46. The dollar's strength is weighing heavily on the yen. It traded at 161.53 and has kept markets?on edge about a possible currency intervention to support the battered Japanese yen. The summary of opinions from the Bank of Japan meeting, where the central bank raised interest rates to a new 31-year high of 1.00 percent, was released on Wednesday. It showed that policymakers discussed the mounting inflation risk, and some called for faster interest rate increases in order to bring borrowing costs closer to levels deemed neutral for the economy. The euro fell 0.15% to $1.1364 while sterling dropped to $1.3192. Spot gold continued to decline, dropping 1.1% to $4.064.01 per ounce. It reached a two-week-low as expectations of higher rates reduced the appeal for non-yielding investments. Bitcoin gained 0.2%, reaching $62,499.52. Ether fell 0.2% to $1.658.09. (Reporting and editing by Satoshi Sugyama; Lincoln Feast.
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Indian shares increase as oil prices fall and banks help
Indian shares rose Wednesday. The gains were attributed to a?lower crude price, comments from the central bank governor?on rate trajectory and inflation, and gains among heavyweight lenders. These factors?outweighed fears over potential 'U.S. Rate hikes and weak monsoon rains. As of 10:28 a.m. IST, the Nifty 50 index rose by 0.6% to 23,963.65, and the BSE Sensex gained 0.75%, reaching 76,768.91. Small-caps and middle-caps were flat. Asian markets dropped 0.3%, after losing 3.8% the previous session. This was due to a selloff of technology and semiconductor stocks, as well as the expectation that a more hawkish Fed would be announced. The expectation of a rate increase in the U.S. by 2026 has weighed on investors' perceptions of emerging markets such as India. Brent crude futures fell 0.8% as signs emerged that oil tankers stuck in the Strait since the beginning of the "Iran War" are about to leave. Lower crude prices are beneficial for India, which is the third largest oil importer in the world. India's benchmark stock indexes dropped about 1.2% on Monday, after each session had gained over 4%. R. Ponmudi is CEO of Enrich Money. He said: "Progress made in U.S.Iran peace talks provides underlying support for markets. But caution prevails, as investors also track the monsoon - a key factor in inflation and broader sentiment over the next few weeks." The Monsoon rains are currently 43% below the average, which raises the possibility of the wettest monsoon in 11 years. Sanjay Malhotra, Governor of the Reserve Bank of India, told ET Now that it was too early to talk about domestic rate increases, because the central bank had not yet seen signs that inflation is becoming widespread. This could be a positive for Indian markets, as it suggests borrowing costs will remain lower for longer. High-weighted banks and private lenders increased by about 1% each after the RBI permitted banks to lend to non-residents using foreign currency deposits. This eased funding flexibility.
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Dollar gains as Fed hikes rates and gold falls to a two-week low
Investors weighed conflicting signals about the U.S. - Iran peace talks as they assessed the 'dollar's rise due to bets placed on a rate hike in the U.S. Gold spot fell by 1.1%, to $4,064.01 an ounce, at 0431 GMT. It had earlier fallen to its lowest level since June 11. U.S. Gold Futures for August Delivery declined 1.7% to $ 4,080.80. Donald Trump, the U.S. president, said on Tuesday that Iran agreed to nuclear inspections in "infinity" while Tehran claimed it had not made such a concession during negotiations. This raises questions about whether their fragile peace agreement will survive. Both sides disagreed over the details of a clause that would give Iran access to frozen funds in foreign accounts. Tastylive's head of global macro,?Ilya?Spivak, said: "What we are witnessing is the evolution of the pressure gold was under as a result of the war." The dollar has risen, gold has fallen, and bonds have fallen. The price of gold has dropped by about 23% in the last few months since the U.S. and Israeli war against Iran began late in February. This is because the rising inflationary pressures have led to the expectation of an interest rate increase from the U.S. Federal Reserve. Gold is traditionally considered a hedge against inflation, but it becomes less attractive as an asset that does not yield in an environment with high interest rates. Dollar hit more than a year high, making bullion expensive for foreign buyers. CME FedWatch Tool shows that traders are betting on three interest rate 'hikes' from the US Federal Reserve this year. This is compared to bets for one hike made before the Fed meeting last week. Investors are now awaiting?the U.S. The Fed's preferred measure of inflation, Personal Consumption Spending data, is due on Thursday. This will provide further clues about monetary policy. Spivak said that if we focus on the inflation rate and remove the $4,000 mark, we will be heading in the direction of $3800. We'll then have to discuss whether we should test $3500 next. (Reporting by Pablo Sinha in Bengaluru; Editing by Subhranshu Sahu and Rashmi Aich) Spot silver dropped 1.6% to a price of $61, platinum fell 1.2% to a price of $1,632.04 and palladium was up 1% to $1,225.35. (Reporting and editing by Subhranshu sahu, Rashmi aich, and Pablo Sinha from Bengaluru)
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MORNING BID EUROPE - Time to cash in those chips?
Tom Westbrook gives us a look at what the future holds for European and global markets. South Korea's chip heavy?KOSPI failed to convince on Wednesday after announcing the fifth largest selloff in history. BNY says that there are signs of a slowdown in the retail investor buying that has driven the index to record-breaking heights. This is especially true after regulators suddenly took a dim view of popular leveraged ETFs. Markets in Seoul were flat in the morning but climbed before noon. For months, downtown has been filled with traders hunched on phones trading stocks. In Taipei the chipmaking giant TSMC fell. The next indicator of the?mood in the industry will be Micron's earnings report after the U.S. closing. It is important to see if the chipmaker has announced long-term deals for supply and payments upfront from large customers. Positioning stretched could lead to disappointment. Bank of America's survey of fund managers in June found that?80% thought long semiconductors was the most crowded trading, a record. More than half of respondents to the same survey believe that we are in the "boom phase" of the investment cycle for artificial intelligence. We have not reached the stages of euphoria, profit-taking or panic of an asset-price-bubble bursting. INDONESIA RETAINS EM status, according to the MSCI review The index provider MSCI has left Indonesia in purgatory after its review of the market classification. Investors are waiting to see if reforms on "free float" and "ownership disclosure" will lead to a more transparent and liquid market. Jakarta's stock market was a mess after the outcome. The Ifo survey on business conditions in Germany is expected?later today, and a slight improvement is expected. The dollar is still gaining strength, but the euro remains under pressure. Investors were wary of a possible joint intervention by the U.S. and Japanese governments to support the yen, as it held at 160.56 yen in Asia after a discussion online between U.S. counterpart Scott Bessent and Japanese Finance Minister Satsuki Katayama. According to a draft of a report that was reviewed by?, Japan intends to look at ways to improve the?management?of its $1.3 trillion in foreign exchange reserves. On Wednesday, the war chest was believed to be mostly held in U.S. Treasury bonds. The following are key developments that may influence the markets on Wednesday. * German Ifo survey on Economics * Micron Earnings (By Tom Westbrook, edited by Christopher Cushing).
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Aluminium at 3-month low due to Gulf supply and strong dollar
The 'London Metal Exchange' saw aluminium prices remain near their three-month lows on Wednesday as the strong 'dollar and expectations of Middle East supply returning weighed. LME benchmark?aluminum for three months edged up by 0.17% to $3,238 per metric tonne at 0300 GMT after plunging in the previous session. The Shanghai Futures Exchange's most traded aluminium contract fell 1.12%, to 23,480 Yuan ($3,453.50), a ton. It fell earlier in the session to a three month low of 23,320 Yuan per ton. After three months of war, there was hope that tensions would ease between the U.S. The LME Cash-to-three Month?Premium On?Tuesday the price of?a ton was $-3.46, indicating an increase in?immediate supply. The U.S. Dollar rose for a fifth consecutive day, supported by safe haven buying. This made the base metals complex more expensive for buyers who use other currencies. The fear of interest rates rising for longer amid high inflation and a hawkish U.S. Federal Reserve remain macroeconomic headwinds. A tech-led stock selloff on Monday also clouded the growth outlook. Borrowing becomes more expensive, and metals linked to economic growth are less in demand. The LME copper price rose by 0.16%, but the SHFE fell?0.98%. In recent years, the red metal has benefited from strong forecasts for AI infrastructure and grid investments as well as electric vehicles. Zinc fell 0.06% among other LME metals, while lead ticked up 0.08%, nickel ticked up 0.1%, and tin dropped 0.86%. Zinc fell 1.72% on SHFE. Lead dipped by 0.31%. Nickel dropped by 1.99%. Tin dropped 4.84%.
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Oil prices continue to fall on the back of expectations for smoother crude flow via Hormuz
On Wednesday, oil prices dropped more than 1%, continuing this week's losses and trading at near four-month highs. This is on signs that more oil tanks stranded in the Gulf will be moving out of the Strait of Hormuz. Brent crude futures were down 78 cents or 1.0% at $76.30 per barrel as of 3:50 GMT. U.S. West Texas Intermediate fell 78 cents or 1.1% to $72.43 a barrel. On Tuesday, both benchmarks fell by around 1% and reached their lowest levels since March. Positive signals from the Persian Gulf are fueling optimism regarding oil flow through the Strait of Hormuz. The number of vessel crossings has increased over the past few days, but they are still?well below levels seen before the war," ING commodity analysts said in a Wednesday note. The price of oil has also been under pressure in the past week, after Washington gave?Tehran 60 days of sanctions relief following initial peace negotiations, allowing them to sell their oil. Tomomichi Akuta is a senior economist at Mitsubishi UFJ Research and Consulting. He added that "further progress in the nuclear negotiations could push back prices to pre-war level." Oman and Iran decided on Tuesday to continue discussions regarding the future administration of the Strait. U.S. Secretary Marco Rubio stated that any Iranian attempt at levying transit fees would be in violation of international law. Even so, there is still uncertainty about the sustainability of the agreement. Trump said that Iran agreed to nuclear inspections "infinity" while Tehran denied this. Investors also watch how quickly Middle-Eastern producers are able to restore exports, and whether or not more ships enter the region. According to a source in the Iranian military, 'Fars News Agency', a small number of vessels is allowed through the strait every day. This is done under coordination with Iran’s Revolutionary Guards Navy. Data from ship-tracking showed that three stranded Supertankers crossed the strait Tuesday. After the U.S. and Iran 'ceasefire agreement, the U.N. Shipping Agency said that an 'evacuation plan is in place to allow hundreds of ships carrying 11,000 seafarers stranded on the Gulf coast to pass through the strait. According to market sources, crude inventories fell by 765,000 barrels during the week ending June 19. The data was released on Tuesday by the American Petroleum Institute. Nine analysts polled estimated that crude inventories had fallen by an average of 4.5 million barrels over the past week. (Reporting from Yuka Obayashi, Tokyo; Jeslyn Lerh, Singapore; editing by Sonali Paul.)
Advent, ADIA-backed gas engine maker Innio raises $2.43 billion in US IPO
Investors flock to companies that are driving the AI boom, including gas engine manufacturer Innio.
Innio, based in Munich, Germany, has a principal?shareholder - AI Alpine. The company is co-owned by Advent International, and Abu Dhabi Investment Authority. 90 million shares were sold at $27 per share, the highest price of the range indicated by the company.
The listing comes against a favorable ?backdrop for AI infrastructure-linked firms, with investors flocking to companies powering the technology's buildout, from electrification ?to supply chain for data centers.
Innio will be one of several companies, ranging from software to insurance, that list in New York this Thursday. The move is being supported by stronger markets and pent-up demand.
Goldman Sachs and J.P. Morgan were the joint book-running managers for this offering.
Innio is set to begin trading under the Nasdaq symbol "INIO", on Thursday.
Innio began to take shape after Advent purchased General Electric's Distributed Power business for $3.25 billion in 2018. Five years later the sovereign wealth fund ADIA acquired a small stake in the company.
Innio, under Advent's ownership has increased its investment in U.S. assembly and manufacturing capacity, and focused on high growth opportunities.
Innio manufactures gas engines?under the Jenbacher?and Waukesha?brands for critical infrastructure including data centers and microgrids.
Data center operators are increasingly pairing new facilities with distributed power generation.
Innio’s annual order intake for data center equipment increased from $27 millions in?2023, to $2,28 billion by 2025. The company has also scored some major?wins including an agreement to build a multi-gigawatt power plant in a large data center.
(source: Reuters)