Global markets tread water as manufacturing data, Fed remarks buoy sentiment

The ISM manufacturing index stayed near a four-year high in June, signaling continued expansion in the U.S. factory sector while input cost increases moderated significantly Source: larepublicaco. Federal Reserve Chair Kevin Warsh, speaking at the ECB's Sintra forum, stated that inflation risks have diminished and repeated that the Fed would not provide forward guidance, a departure from past practice Source: larepublicaco.

Inflation and central bank caution

The Bank for International Settlements (BIS) urged central banks to prioritize inflation control even at the expense of growth, warning that the effects of the Iran conflict could persist despite the provisional peace deal. Global inflation has risen one percentage point since the war began Source: infobae. Meanwhile, ING warned that central banks are no longer a boost for markets, and that investors are "very sensitive to bad news," which could trigger sharp corrections. However, corporate earnings have surprised on the upside, with S&P 500 profits growing 28% versus the 13% initially forecast Source: elmundoes.

Market reactions and sector divergence

Gold has fallen 22.5% since the Iran war started, trading below $4,100 per ounce as a strong dollar and reduced central bank buying weigh on the metal Source: elespanol. European banks are deemed resilient by S&P, with solid capital and liquidity to absorb geopolitical shocks Source: infobae. In tech, Micron surged 16% on AI-driven chip demand, while Apple faced sharp declines due to rising memory chip costs, highlighting a two-speed market Source: elconfidencial.