Finance

Chipmaker stocks experienced a sharp reversal after the Philadelphia Semiconductor Index recorded its best-ever quarterly performance with a near 88% gain. Concerns were fueled by reports of Meta Platforms commercializing excess artificial intelligence computing capacity, leading to a 6.3% slump in the sector. Heavyweight names like Micron, Intel, and AMD all saw significant losses as investors locked in profits from the high-growth AI trade.

In recent remarks, Fed Chair Kevin Warsh acknowledged that inflation risks have moderated, leading markets to dial back expectations for an imminent interest rate hike this month. Despite this softening stance, Warsh reiterated the central bank's firm commitment to a 2% price stability target, effectively dismissing hopes for loose monetary policy in the near term. Current market pricing suggests a less than 30% probability of a rate increase during the July meeting.

Cryptocurrency markets stabilized on July 2 with Bitcoin climbing back above the $60,000 threshold following a challenging month that saw a record $4.5 billion exit from Bitcoin ETFs. The recovery was supported by easing inflation concerns and technical factors such as short covering. Other digital assets, including Ether and Solana, also posted gains, while crypto-related equities like Coinbase and MicroStrategy surged in response to the improved sentiment.