Overnight US stocks | The Dow Jones Industrial Average has reached a new historical high, while SpaceX (SPCX.US) is about to unlock its shares, resulting in a price drop of over 13%.

On Wednesday, the three major indices had mixed results, with the Dow Jones Industrial Average hitting a new historical high. The S&P 500 index ended a streak of four consecutive days of gains. In the U.S. stock market, the Dow closed up 263.24 points, an increase of 0.49%, at 54,349.12 points; the Nasdaq fell 221.55 points, a drop of 0.83%, closing at 26,363.44 points; the S&P 500 index decreased by 12.97 points, down 0.17%, ending at 7,723.55 points. NVIDIA Corporation (NVDA.US) rose by 3.43%, Micron Technology, Inc. (MU.US) increased by 0.06%, Advanced Micro Devices, Inc. (AMD.US) fell by 7.04%, and SpaceX (SPCX.US) declined by 13.61%. Insider lock-up shares will be released on August 6 (Thursday), involving a market value of about $116 billion. In European stocks, the German DAX 30 index fell by 83.97 points, a decrease of 0.32%, closing at 26,139.29 points; the UK FTSE 100 index increased by 10.68 points, up 0.10%, at 10,890.06 points; the French CAC 40 index rose by 2.67 points, up 0.03%, settling at 8,669.30 points; the European Stoxx 50 index dropped by 7.45 points, a decrease of 0.11%, at 6,479.25 points; the Spanish IBEX 35 index gained 31.20 points, an increase of 0.16%, at 20,054.80 points; the Italian FTSE MIB index decreased by 99.50 points, down 0.19%, closing at 53,441.00 points. In the Asian stock market, the Nikkei 225 index increased by 3.66%, and the Korea Composite Stock Price Index rose by 3.76%. In the U.S. Dollar Index, it declined for the fifth consecutive day. The index, which measures the dollar against six major currencies, fell by 0.18%, closing at 99.676. At the end of the New York foreign exchange market, 1 euro was exchanged for 1.1553 dollars, up from the previous day's 1.1533 dollars; 1 pound was worth 1.3469 dollars, higher than the previous day's 1.3452 dollars. 1 dollar was exchanged for 157.67 yen, up from 157.66 yen the previous day; 1 dollar was worth 0.8069 Swiss francs, down from 0.8092 Swiss francs the previous day; 1 dollar was exchanged for 1.4008 Canadian dollars, down from 1.4066 Canadian dollars the previous day; 1 dollar was worth 9.4832 Swedish krona, down from 9.5192 Swedish krona the previous day. Bank of America Corp stated that, following coordinated currency intervention, the yen is expected to appreciate by about 6% by the end of the year. Analysts, including Shusuke Yamada, wrote on Wednesday that, supported by the joint actions of the U.S. and Japanese governments and the anticipation of potential interest rate hikes from the Bank of Japan in the coming months, the USD/JPY exchange rate is expected to decline from the current level of about 158 to 149. The bank had previously estimated an end-of-year exchange rate of 152. They wrote, "The intervention action has raised the bar for successfully defending the yen, which may require follow-up macro policies, specifically accelerating interest rate hikes. Acting in September rather than waiting until October would provide the Bank of Japan with an opportunity to demonstrate its commitment to staying ahead of inflationary risks." In the cryptocurrency space, Bitcoin briefly surpassed $65,000, and as of the time of publication, it was up 0.67%, trading at $64,702.79; Ethereum rose more than 1.7%, reaching $1,909. In the oil market, prices fell for the third consecutive trading day as signs emerged that the U.S. and Iran are nearing an agreement to reopen the Strait of Hormuz, which may restore millions of barrels of oil supply per day that were disrupted due to months of conflict. The WTI settlement price for September delivery was reported at $75.22 per barrel. The Brent settlement price for October delivery was reported at $79.45 per barrel. In precious metals, spot gold surged, breaking through the $4,200 mark, closing at $4,246.17; spot silver also surpassed $60, closing at $62.047. In macro news, Iran stated that it is close to reaching an agreement with Oman to close two existing shipping lanes in the Strait. Iranian Deputy Foreign Minister Abbas Araghchi stated on the 5th that the agreement between Iran and Oman regarding the passage of commercial vessels through the Strait of Hormuz is nearing finalization, at which point both the northern lane controlled by Iran and the southern lane close to Oman will be closed. According to the Islamic Republic News Agency on the 5th, Araghchi said in an interview that a new passage mode different from the past 60 years will be established in the Strait of Hormuz. Currently, the southern lane through Oman's territorial waters and the northern lane within Iranian waters will be closed. Under the newly set route, commercial vessels entering and exiting the Strait of Hormuz will transit through Iranian waters. However, the new route will also be a temporary route, expected to be usable for 2 to 4 months. Araghchi denied the speculation that Iran and the U.S. are negotiating, but mentioned that Iran received information from the U.S. and that the U.S. indicated its readiness to resume commitments made in previous memorandums of understanding. Federal Reserve Governor Cook: I will be prepared to support a rate hike if inflation does not subside. Federal Reserve Governor Cook reiterated her position: If inflation does not ease, she is ready to raise interest rates and warned that policymakers may not have the luxury of waiting for inflation to return to the 2% target. Although Cook supported the Federal Reserve's decision to keep rates unchanged at the July policy meeting, she warned that the longer inflation remains above the Feds target, the harder it becomes to contain it. Speaking at an event in Alaska, Cook stated, "If I do not see signs of inflation subsiding soon, I am prepared to take action. With inflation above target for five consecutive years, the risk of inflation becoming entrenched in pricing and wage-setting behavior is rising, making it more difficult for us to manage persistent inflation." However, Cook indicated that the waning effects of tariffs, the potential for falling oil prices, and easing pressures related to the AI boom could provide a buffer for inflation, potentially avoiding the need for tightening policies. She emphasized that her top priority remains bringing inflation back to the Fed's target level. U.S. service sector activity maintains stable expansion with resilient demand supporting growth. Due to a rebound in new orders and business activity, the U.S. service sector maintained a stable expansion in July. Data released on Wednesday showed that the ISM services index rose by 0.1 points to 54.1, remaining above 50, indicating that the sector is in an expansion phase. The growth rate of new orders accelerated, and the business activity indicator reached a five-month high, showcasing resilient consumer demand. However, rising service and material costs continue to pressure businesses. The ISM input cost price index spiked to 70.3 in July due to the disruption of the temporary agreement between the U.S. and Iran, pushing oil and gasoline prices up. As sustained high costs squeeze corporate profits and impact consumer spending, some businesses may choose to postpone hiring. Employment indicators from the agency indicated the most significant contraction in business employment since March. In individual stock news, SanDisk's poor earnings guidance led to an 8% drop in after-hours trading. SanDisk (SNDK.US) reported strong Q4 earnings for fiscal year 2026, with revenue and profit exceeding market consensus, with revenue surging 372% year-over-year and 51% quarter-over-quarter. Options expiring the week of August 7 show that the $1370 strike price has the highest open interest among both call and put options. Intense options trading following the earnings report may have contributed to the stock's weak performance. The revenue outlook for the next quarter ($10.3 billion to $10.8 billion) is also likely a reason for the post-market decline. SanDisk's management stated, "The revenue beat was driven by our shift to high-value customer segments (data center business grew by 437%) and pricing increases." SanDisk's stock fell by as much as 8% in after-hours trading. Meta launched its first programming agent Muse Code, which works with Muse Spark 1.2. Meta Platforms (META.US) has launched its first programming agent, Muse Code, attempting to challenge Anthropic and OpenAI. Muse Code is the latest significant release since Alexandr Wang took over as Meta's AI head, overseeing the development of foundational models at the Meta Superintelligence Lab (MSL). Muse Code aims to make it easier for users to develop applications within a single user interface while managing AI-driven agents. The programming agent is currently available in a test or preview version and can work in conjunction with Meta's latest AI model, Muse Spark 1.2. Developers can access Muse Code on a pay-as-you-go basis, using an API pricing model similar to Muse Spark 1.1, priced at $1.25 per million input tokens and $4.25 per million output tokens. Microsoft Corporation's AI revenue is more than half from OpenAI, showing high dependence on the partnership. Microsoft Corporation (MSFT.US) disclosed that a significant portion of its AI revenue comes from OpenAI. In a filing submitted last week, Microsoft stated that during the fiscal year ending June, it generated $24.1 billion in sales from OpenAI. Microsoft CEO Satya Nadella previously indicated that by the end of the March quarter, the company's AI business revenue was expected to reach $37 billion on an annualized basis. This disclosure shows that OpenAI contributed to more than half of Microsoft Corporation's actual AI sales in the most recent fiscal year and may account for about 70%. Under the agreement between the two companies, OpenAI pays Microsoft Corporation for computing power, AI model development costs, and a portion of revenue sharing. Alphabet Inc. Class C is making significant adjustments to its AI leadership; AI head Demis Hassabis resigns from key management roles. Alphabet Inc. Class C's parent company, Alphabet (GOOGL.US), announced on Wednesday a major reshuffle in its AI division, with AI head Demis Hassabis stepping down from major management positions, alongside several other Gemini model leaders, including senior engineer Jeff Dean. This personnel change comes at a critical time for Alphabet Inc. Class C DeepMind: its flagship version of the latest Gemini model, originally planned for release in June, has yet to come out, raising concerns among investors and industry watchers that Alphabet Inc. Class C is falling behind its competitors Anthropic and OpenAI, both of which recruited an AI star employee from Alphabet Inc. Class C this summer. Hassabis will take on the newly created role of Chief Scientist at Alphabet, transitioning from CEO of Alphabet Inc. Class C DeepMind to Chairman. The business divisions Chief Technical Officer, Koray Kavukoglu, will take over daily management responsibilities, serving as the Senior Vice President of the division while continuing as Alphabet's Chief AI Architect. In major bank ratings, Deutsche Bank Aktiengesellschaft has lowered the target price for SpaceX (SPCX.US) from $255 to $235.