TL;DR

Weak U.S. jobs data boosts Fed cut odds; Trump ousts BLS chief; Microsoft hits $4T on AI.

Highlights

• U.S. July payrolls rose just 73,000, with May/June revised down by 258,000; unemployment hit 4.25%19.
• Odds of a Fed rate cut in September jumped to 87% post-jobs data; Treasury yields and USD fell1.
• Trump fired the BLS chief, criticized Powell, and is seeking a new Fed chair; Fed Governor Kugler resigned28.
• S&P 500 dropped 1.6% Friday, its sharpest fall in over two months, amid concerns over data credibility and Fed independence2.
• OPEC+ eight raised September oil quotas by 548,000 bpd, ending voluntary cuts; further increases possible by year-end3.
• Microsoft briefly surpassed $4T market cap after strong AI/cloud results; plans $100B+ in FY26 AI/data center capex1218.
• China launched a cybersecurity probe into Nvidia’s H20 chip, complicating U.S. chipmaker’s China expansion; export licenses pending4.
• China imposed a comprehensive ban on crypto trading and mining; U.S. SEC unveiled “Project Crypto” to clarify token/DeFi rules56.
• Bitcoin fell below $113,000 after record ETF outflows and $577M in liquidations; Ether ETFs also saw outflows7.
• Trump confirmed a 50% tariff on Brazilian coffee starting Aug. 6; China cleared 183 Brazilian exporters to shift supply14.
• Over 1,300 U.S.-listed companies report earnings this week, including Palantir, AMD, Disney, Uber, and McDonald’s; options imply large moves10.
• Berkshire Hathaway reported a $3.76B Kraft Heinz write-down, 4% operating profit drop, and a record $344B cash position; buybacks paused11.

Commentary

Markets open to heightened uncertainty after a weak U.S. jobs report sharply increased expectations for a September Fed rate cut19. The disappointing payrolls and large downward revisions have pushed Treasury yields and the dollar lower, while equities sold off on Friday as investors reassess both the economic outlook and the independence of U.S. data agencies12. Political intervention—Trump’s firing of the BLS chief, criticism of Powell, and a surprise Fed governor resignation—adds a layer of risk to policy predictability28.

In commodities, OPEC+ is raising output for September, signaling a more flexible supply stance3. This could limit oil price gains, even as geopolitical risks persist. U.S. tariffs on Brazilian coffee, and China’s quick move to approve more Brazilian exporters, are likely to raise U.S. coffee costs and shift trade flows14. The energy sector is also in focus with Berkshire Hathaway’s write-down and the EU’s ambitious but questioned U.S. energy import pledge1119.

Tech remains a driver, with Microsoft’s $4T milestone and record AI capex highlighting sector strength1218. However, China’s probe into Nvidia’s H20 chip and the ongoing U.S.–China tech tensions may weigh on chipmakers4. In crypto, China’s outright ban contrasts with the U.S. SEC’s move to clarify digital asset rules56. Still, Bitcoin and Ether are under pressure from large ETF outflows and liquidations, leaving the sector vulnerable to further declines7.

Earnings season hits its peak, with over 1,300 U.S.-listed companies reporting10. Options markets are pricing in significant volatility, especially in AI, consumer, and industrial names. With macro, policy, and sector-specific risks elevated, traders should expect choppy price action and closely monitor developments in labor data, Fed policy, and tech regulation.