Group 1 - The report maintains a cautiously optimistic view on the Hong Kong stock market, indicating that a breakthrough of previous highs requires new catalysts [1][4] - The US stock market is in a rebound trend, reaching historical highs, with the S&P 500 and Nasdaq both showing significant gains of 3.4% and 4.2% respectively [1][3] - The Federal Reserve's dovish stance has increased the probability of interest rate cuts, with expectations rising to three cuts by the end of the year [1][16] Group 2 - Concerns over "capital tax" have eased as the US government is likely to repeal Clause 899, which could have led to foreign capital withdrawal from US assets [2] - Optimism surrounding AI continues to drive the technology narrative, with strong performance and guidance from companies like Micron Technology and Nvidia [2][3] - The report notes that the US stock market is experiencing a return of funds, with significant inflows into US stock ETFs, totaling nearly $42.7 billion over two weeks [3][19] Group 3 - In the short term, the US stock market is expected to experience a primarily upward trend, supported by improving macroeconomic conditions and ongoing AI investment enthusiasm [3][4] - The report highlights that the upcoming quarter is crucial for observing economic fundamentals and corporate earnings, which will guide market movements [4][5] - The report indicates that the financial environment in the US remains at a relatively low level, providing a supportive backdrop for market growth [4][19] Group 4 - The report emphasizes that despite uncertainties, the US stock market is expected to return to a trajectory driven by economic fundamentals and corporate earnings resilience in the second half of the year [4][19] - The report notes that the inflow of funds into the financial, healthcare, and industrial sectors is notable, while significant outflows are observed in the information technology sector [5][15] - The report also mentions that gold ETFs have seen substantial inflows, particularly in the US and Ireland, indicating a shift in investment preferences [6][22]

Core Viewpoint - The U.S. Treasury Secretary, Becerra, has requested the removal of the controversial "capital tax" clause (Section 899) from the "Big Beautiful" tax bill, alleviating Wall Street's concerns [1][3][10]. Group 1: Tax Clause Developments - The U.S. Treasury has reached an agreement with G7 allies to exempt U.S. companies from certain taxes imposed by other countries after agreeing to remove the "retaliatory tax" proposal from Trump's tax plan [1][2]. - Becerra previously defended the "capital tax" clause, stating its purpose was to prevent foreign countries from imposing additional taxes that could harm U.S. multinational companies [4][6]. - The "retaliatory tax" clause was drafted by House Republicans and supported by the White House to counter what they deemed discriminatory tax policies from several countries, including European nations, Canada, and Australia [5][6]. Group 2: Implications of the Tax Clause - The clause primarily targeted countries imposing digital services taxes on U.S. tech companies and those implementing a global minimum corporate tax [6][7]. - The OECD is leading a global corporate tax reform negotiation, which includes a proposal for a 15% global minimum corporate tax that has faced opposition from the U.S. [6][7]. - The controversial "capital tax" clause proposed a punitive tax on passive income for investors from targeted countries, increasing by 5 percentage points annually, up to a maximum of 20% [8][9]. Group 3: Market Reactions - Following the news of Becerra's request to remove the capital tax, market reactions were muted, with the Bloomberg Dollar Index declining for the fourth consecutive day and U.S. Treasury prices rising [12][13]. - Analysts noted that removing Section 899 from budget negotiations could provide more certainty for non-U.S. investors frequently investing in the U.S. [13].

Market Overview - Major global stock indices showed mixed performance, with the Dow Jones Industrial Average rising by 404.41 points (0.94%) to 43,386.84, while the S&P 500 increased by 48.86 points (0.80%) to 6,141.02 [1] - In contrast, the European Stoxx 50 declined by 7.98 points (-0.15%) to 5,244.03, and the Shanghai Composite Index fell by 7.52 points (-0.22%) to 3,448.45 [1] Trade and Economic Policies - U.S. trade partners, including Japan, India, and the EU, are hesitant to sign agreements due to uncertainty over potential tariffs on key exports like chips and pharmaceuticals [2] - The U.S. Treasury Secretary requested the removal of a "retaliatory tax" proposal from a tax bill, which could impose a 20% tax on foreign investors from countries deemed to impose unfair taxes on U.S. companies [2][5] Company Developments - Xiaomi announced that its Yu7 model received over 289,000 pre-orders within the first hour of availability, indicating strong consumer interest [3][4] - Nike's stock surged by 10% following the release of its quarterly earnings report, which showed earnings per share of $0.14, slightly above expectations [4] - Nike's CFO indicated that new tariffs could increase total costs by approximately $1 billion for the fiscal year 2026, prompting the company to adjust its supply chain and pricing strategies [5] Mergers and Acquisitions - CoreWeave is in talks to acquire Core Scientific to expand its cloud computing capabilities, with the deal expected to be finalized in the coming weeks [7][8] - Following the acquisition news, Core Scientific's stock price rose by 33%, reflecting investor optimism [9] Regulatory Changes - Apple modified its App Store policies in Europe to comply with the Digital Markets Act, aiming to avoid a potential €500 million fine [11][12] - The new policy introduces a complex fee structure for app developers, including a 5% commission on digital purchases made outside the App Store [12]

Core Points - The U.S. Treasury Secretary, Becerra, requested the removal of the controversial "capital tax" clause 899 from the "Big Beautiful" tax bill, alleviating concerns on Wall Street [1][2] - The U.S. Treasury announced an agreement with G7 allies to exempt U.S. companies from certain taxes imposed by other countries following the removal of clause 899 [1][2] Group 1: Clause 899 Overview - Clause 899, informally known as the "retaliatory tax," was designed to counteract what U.S. lawmakers deemed "discriminatory" tax policies imposed by several countries on U.S. companies [2][3] - The clause aimed to impose an escalating punitive tax on passive income (such as interest and dividends) earned by investors from targeted countries, increasing by 5 percentage points annually, up to a maximum of 20 percentage points [4] - It was projected to raise $116 billion over ten years to fund Trump's extensive tax and spending plan, raising concerns about its impact on foreign investment in the U.S. [4] Group 2: Market Reactions and Implications - Following the announcement, market reactions were generally muted, with the Bloomberg Dollar Index declining for the fourth consecutive day and U.S. Treasury prices rising [6] - The removal of clause 899 is seen as a positive development for non-U.S. investors, providing more certainty for investments in the U.S. [6] - Analysts warned that the tax could pressure high-dividend stocks and exacerbate concerns about investors' willingness to hold dollar-denominated assets [5]

Group 1 - The U.S. Senate is preparing for a critical vote on the Trump administration's "Big Beautiful" tax and spending bill, aiming for completion by early next week to meet the July 4 signing goal [1] - Internal divisions within the Republican Party pose challenges to the bill's passage, with key figures expressing concerns over the timeline and policy details [2] - The SALT (State and Local Tax) deduction cap has become a significant point of contention, with the Senate version maintaining a $10,000 cap while the House version proposes raising it to $40,000 [3] Group 2 - The Democratic Party has been excluded from the tax reform negotiations but has successfully challenged and removed several provisions from the bill, including those unrelated to tax, spending, or budget [4] - Democrats are currently working to remove the "capital tax" provision, which has raised concerns about capital flight from the U.S. [5]

Core Viewpoint - The demand for gold is likely to increase further, contingent on the implementation of the "Section 899" tax provision, which may lead central banks to reduce their holdings in U.S. Treasury securities and increase their investments in gold and other non-dollar assets [1]. Group 1: Central Bank Gold Purchases - Global central banks and official institutions (excluding the U.S.) purchased 68 tons of gold in April through the London OTC market, significantly higher than the pre-pandemic average of 17 tons per month in 2022 [1]. - The average monthly gold purchases by central banks so far this year have reached 88 tons, slightly exceeding Goldman Sachs' previous forecast of 80 tons per month by mid-2026 [1]. Group 2: Section 899 Tax Provision - The "Section 899" tax provision is currently under review by the U.S. Congress, with ambiguous language regarding whether interest earned by foreign central banks on U.S. Treasury holdings will be subject to withholding tax [1]. - If implemented, this provision could diminish the attractiveness of U.S. Treasury securities for foreign central banks, prompting them to increase their gold holdings [1]. - However, Goldman Sachs economists believe that the likelihood of this tax reform being canceled or postponed is high, as the Senate may reject it, or central banks may be exempted or have the implementation delayed until 2027 [1]. Group 3: Gold Price Forecast - Goldman Sachs reaffirms a bullish stance on gold trading, predicting that strong central bank purchases will drive gold prices to $3,700 per ounce by the end of 2022 and further to $4,000 per ounce by mid-2026 [1].

Group 1 - The core viewpoint is that global gold demand may rise further depending on the implementation of the "Section 899" tax provision [1][2][4] - Central banks and official institutions (excluding the US) purchased 68 tons of gold in April through the London OTC market, significantly higher than the pre-pandemic average of 17 tons per month [1] - The average monthly gold purchases by central banks this year have reached 88 tons, slightly exceeding Goldman Sachs' previous forecast of 80 tons per month by mid-2026 [1] Group 2 - Goldman Sachs indicates that if the Section 899 tax proposal leads to a reduction in central bank allocations to US Treasuries, gold demand could further increase [2][4] - The Section 899 provision is currently under review by the US Congress, with unclear implications regarding whether interest earned by foreign central banks on US Treasuries will be subject to withholding tax [4] - Goldman Sachs economists believe that the likelihood of this tax reform being canceled or delayed is high, as the Senate is likely to reject it, and even if passed, central banks may be exempted or the implementation delayed until 2027 [5] Group 3 - Goldman Sachs maintains a bullish stance on gold trading, predicting that strong central bank purchases will drive gold prices to $3,700 per ounce by the end of 2022 and further to $4,000 per ounce by mid-2026 [5] - Due to significant increases in gold holdings by global central banks and rising gold prices, gold has replaced the euro as the second-largest reserve asset held by central banks, following the US dollar [5]

Core Viewpoint - The U.S. Treasury Secretary, Becerra, stated that the "capital tax" provision in the tax legislation draft, specifically clause 899, is filled with misinformation and emphasized that the tax reduction legislation is a fiscal proposal rather than a retaliatory measure [1] Group 1 - The tax reduction legislation is characterized as a fiscal proposal [1] - Companies concerned about clause 899 should lobby their respective governments [1]

Core Viewpoint - The U.S. Treasury Secretary, Becerra, criticized the "capital tax" provision in the tax legislation draft, stating it is filled with misinformation and emphasized that the tax reduction bill is a fiscal measure rather than a retaliatory one [1] Group 1 - The "capital tax" provision contains numerous inaccuracies according to the U.S. Treasury Secretary [1] - The tax reduction bill is characterized as a fiscal bill, not a measure for retaliation [1]

Core Points - The "Big and Beautiful" bill promoted by President Trump includes a controversial tax provision (Section 899) aimed at foreign investors, which has faced strong opposition from multinational corporations [1][2] - Executives from around 70 global companies are lobbying against this tax plan, warning it could threaten millions of American jobs [2][3] - The provision allows the U.S. to impose additional taxes of up to 20% on companies from countries with punitive tax policies, potentially affecting a wide range of foreign entities [2][4] Group 1 - The tax provision could lead to a significant reduction in foreign investment in the U.S., with concerns that it may force many multinational companies to close their U.S. operations, jeopardizing approximately 8.4 million jobs [2][3] - The International Bankers Association, representing top global banks, is advocating for a delay and revision of the tax plan to protect international investments in the U.S. [3][4] - The provision is seen as a negotiation tool by the Trump administration, aimed at increasing leverage in trade discussions with other countries [3][6] Group 2 - The Congressional Budget Office estimates that Section 899 could generate $116 billion in tax revenue over the next decade, but the overall bill may increase U.S. debt by $2.4 trillion by 2034 [4] - Financial institutions like Goldman Sachs suggest that European companies may consider re-listing in the U.S. as a strategy to mitigate the impact of the tax, although tax experts warn this may not be a straightforward solution [5][6] - The provision could exert downward pressure on the U.S. dollar and diminish the motivation for foreign investment, affecting both U.S. and foreign companies significantly [5][6]