Market Report.
📊 The divergence between the Market and the technology sector has returned. S&P 500 futures have continued to move higher, while the Nasdaq remains lagging in a sideways pattern. This could indicate a rotation of capital into other sectors.
💼 Oracle’s Q2 revenue and software revenue missed analyst expectations, causing the stock to plummet 11% after hours. Analysts were left confused on the outlook for Oracle shares, citing uncertainty and an overhang on the stock due to concerns about the company’s ability to convert its large backlog into profitable revenue streams. Oracle is making the necessary investments in AI and cloud infrastructure, but the market is still trying to assess the timing and profitability of this transition.
🤖 Broadcom’s shares declined in after-hours trading after the company’s outlook for artificial intelligence revenue failed to meet investors’ high expectations. Broadcom CEO Hock Tan said the company has a backlog of $73 billion in AI product orders to be shipped over the next six quarters, which disappointed some investors.
⚠️ Tan warned that total profit margins were narrowing due to AI product sales, even as the company reported generally upbeat earnings and provided a strong revenue outlook for the current quarter. The company has struck major deals with AI leaders like OpenAI and Anthropic, fueling investor enthusiasm about Broadcom’s AI prospects.
🚀 But this is not the beginning of the end for AI — it is merely a bump in the road. Trump is stepping in to support the sector. Let me explain:
🛡️ President Trump has signed an executive order aimed at thwarting state-level regulation of artificial intelligence, handing a policy win to tech industry leaders. The order is intended to bolster the emerging AI technology and counter a patchwork of state-level regulations that the industry worries will hamper its growth.
⚖️ The order will allow the Department of Justice to sue states over AI regulations it deems unconstitutional and threaten funding cuts to states with overly burdensome laws. This move was championed by the White House’s AI czar and lobbied for by major tech companies like OpenAI, Google, and Nvidia, who fear state-level rules could cripple the industry.
🔬 ASML is aggressively investing in its cutting-edge lithography technology, supply chain, and customer relationships to capitalize on the explosive growth of the AI hardware market, while navigating geopolitical challenges.
💥 The current market is described as an “AI arms race”, driven by massive investments from tech giants in building superior AI models and infrastructure. ASML has a massive €36 billion order backlog, with AI-related demand being the primary driver for projected record growth in 2026. There is a potential decline in ASML’s China business due to ongoing geopolitical trade restrictions.
🇮🇹 Italy has reassured the ECB after declaring that its gold reserves — held in custody by the central bank — are the property of the Italian state. The prospect of an Italy seeking to take full control of its assets, at a time when the European Union is under pressure, had worried many investors. Does this smell like Italexit?
🏛️ Italy has resolved differences with the European Central Bank (ECB) over a draft budget amendment on the ownership of the Bank of Italy’s gold reserves. The amendment, proposed by members of Prime Minister Giorgia Meloni’s right-wing party, stated that the gold held by the Bank of Italy belongs to “the Italian people”, raising concerns from the ECB about the central bank’s independence.
🤝 Italian Economy Minister Giancarlo Giorgetti and ECB President Christine Lagarde resolved the issue on the sidelines of a meeting of euro zone finance ministers in Brussels. Giorgetti reassured Lagarde that Rome had no plans to transfer the Bank of Italy’s gold reserves, which are worth around $300 billion, off the central bank’s balance sheet, ruling out a move that would circumvent the prohibition on central banks financing the public sector.
📝 The government is now working on rewording the amendment to address the ECB’s concerns, with Giorgetti outlining the new terms in a letter to Lagarde, stating the provision is intended to clarify that the holding and management of the gold reserves are the responsibility of the Bank of Italy in accordance with EU treaty rules.
🌍 A leaked document also describes a radical shift in global diplomacy, proposing the creation of a new “Core 5” (or C5) forum to replace the influence of the G7.
🔄 Trump administration is considering a dramatic shift in global governance, potentially creating a new forum centered on “great power” dynamics and sidelining traditional Western alliances and institutions.
📑 The leaked draft of the US National Security Strategy reported in December 2025: The “Make Europe Great Again” Strategy. The strategy targets four specific countries – Austria, Hungary, Italy, and Poland – and aims to support political parties and movements in these nations that “seek sovereignty and preservation/restoration of traditional European ways of life”. The rationale frames mass immigration and multiculturalism as threats leading to “civilizational erasure” in Europe, echoing the rhetoric of figures like Geert Wilders.
🌐 The C5 Proposal would effectively sideline the G7 and exclude Western Europe. The proposed members of the C5 are the United States, China, Russia, India, and Japan – notably excluding all European nations and the European Union.
❌ The Trump administration has officially rejected the report, with the Deputy Press Secretary calling the leaked draft “fake news” and stating that only the public version of the NSS is authentic.
⚙️ This shift is seen as aligning with a “Make Europe Great Again” strategy, viewing traditional European allies as bureaucratic obstacles rather than assets. The C5 would bring together nations with massive populations and significant military or economic leverage, prioritizing “great power” influence over democratic values or traditional alliances.
🕊️ President Trump said the U.S. would be willing to contribute security assistance to help end the war in Ukraine, but expressed frustration with the pace of negotiations. He said U.S. would “help with security” as part of an agreement to end the conflict, though he did not specify what type of assistance.
🏘️ However, Trump expressed disappointment that Ukrainian President Zelenskyy had not more readily signed off on an earlier U.S. peace plan, which was seen as too accommodating to Russia. Zelenskyy has floated the prospect of allowing Ukrainians to vote on whether to hand the Donbas region to Russia, which Trump described as a “complex real estate deal times one thousand.”
🛡️ The U.S. has scaled back direct military aid to Ukraine under Trump, favoring a system where NATO allies (European Union) can purchase American armaments for Kyiv. Leaving behind a Europe in crisis, one constrained by a political class increasingly detached from the reality faced by its citizens, and seemingly aligned with policies that ultimately benefit the US defence industry.
⚔️ NATO Secretary General Mark Rutte’s Stark Warning: Europe needs to prepare for a “scale of war our grandparents and great-grandparents endured”, referring to the massive conflicts of the 20th century like World War II.
📢 Rutte criticized Western complacency, arguing that too many Europeans and leaders “believe that time is on our side” when in fact “it is not” and “conflict is at our door”. The primary goal of his message was to catalyze an immediate and rapid increase in defense spending and military production across the NATO alliance.
🛩️ Rutte referenced escalating tensions, including drone incursions into NATO airspace and intensified covert operations by Russia against European societies, as well as comments from Russian President Vladimir Putin claiming Russia was “ready for war right now”. It seems he forgot to add that Putin’s full statements included a “If Europe wants a war with Russia we are ready”
Market View.
📈 S&P 500 futures continue to advance, pulling ahead of the Nasdaq 100. S&P 500 futures have broken above 6,900 points, while the Nasdaq 100 failed to consolidate above 25,800 and has slipped to around 25,675.
💲 The US Dollar Index (DXY) continues to weaken, approaching 98.15 in recent hours before rebounding slightly to 98.35. This has supported pairs such as EUR/USD, which briefly exceeded 1.1750 before easing to the current 1.1735.
🇩🇪 In Europe, DAX 40 futures have also moved higher, trading above 24,400 points. Euro Stoxx 50 futures have posted a strong bullish push and are now approaching the 5,800‑point level.
🛢️ Crude oil fell again during yesterday’s session, with Brent dropping below $61, before bouncing to $61.60 in spot trading.
🥇 Gold futures also saw a significant upward move and are now trading above $4,300 per ounce.
₿ Bitcoin continues its zig‑zag price pattern, making another attempt to break higher. It moved above $92,000, briefly surpassing $93,500, but has since pulled back to around $92,455.
