Key Takeaways
- The UK jobs market experienced a significant weakening in July, as employers curtailed payroll budgets in response to Chancellor Rachel Reeves’ £26 billion ($34.9 billion) tax increase, leading to the slowest rise in starting salaries in over four years.
- SK Hynix (000660.KS), a key supplier to Nvidia (NVDA), projects the AI memory market to grow 30% annually until 2030, driven by surging demand for high-bandwidth memory (HBM) chips.
- SoftBank (SFTBY) has engaged major banks for a potential U.S. Initial Public Offering (IPO) of its Japanese payments app, PayPay, which could raise over $2 billion as soon as the final quarter of this year.
- Oil prices extended their weekly decline as traders closely monitored anticipated talks between U.S. President Donald Trump and Russian President Vladimir Putin, adding uncertainty to the commodity market.
The global economic landscape is navigating a complex mix of fiscal pressures, technological advancements, and geopolitical shifts, as evidenced by recent market movements and corporate announcements.
The United Kingdom's jobs market saw a notable downturn in July, with employers cutting back on hiring. This weakening is largely attributed to Chancellor Rachel Reeves’ £26 billion ($34.9 billion) tax increase, which has raised labor and tax costs for businesses. The impact is visible in starting salaries, which rose at their slowest pace in over four years, and a contraction in demand for permanent staff, marking the sharpest decline in five months. Employers are reportedly slashing hiring plans amid rising wage costs and deepening economic uncertainty, with some surveys indicating that a significant portion of UK businesses plan to reduce headcount due to these tax changes.
In the technology sector, SK Hynix (000660.KS), a crucial supplier of high-bandwidth memory (HBM) products to Nvidia (NVDA), is forecasting robust growth for the AI memory market. The company expects the market to expand by 30% annually through 2030, fueled by aggressive AI investments from global tech giants. SK Hynix reported record second-quarter results, with net profit up 70% year-over-year to $5.09 billion, driven by surging demand for its AI memory chips. The company plans to increase its investment this year to meet this strong demand, including doubling HBM sales year-over-year and opening a new South Korea plant by late 2025 for DRAM and HBM production.
Meanwhile, Japanese tech conglomerate SoftBank (SFTBY) is moving forward with plans for a U.S. IPO of its payments app, PayPay. Investment banks including Goldman Sachs, JPMorgan Chase & Co. (JPM), Mizuho Financial Group (MFG), and Morgan Stanley (MS) have been selected to lead the offering, which could raise more than $2 billion as early as the final quarter of this year. This strategic move aims to unlock capital for SoftBank, whose Vision Fund has faced substantial losses, and to establish PayPay as an independent entity.
In the commodities market, oil prices continued their weekly decline. West Texas Intermediate (WTI) crude dipped 1.2% to settle just above $64 a barrel, marking its longest daily losing streak since September. This downturn is largely influenced by speculation surrounding a potential meeting between U.S. President Donald Trump and Russian President Vladimir Putin, which could signal a softer stance on Russian energy flows. The anticipation of these talks, coupled with new U.S. tariffs and OPEC+ output increases, has injected further uncertainty into the market.
Finally, the Reserve Bank of Australia (RBA) is navigating its new policy board, which has introduced an element of unpredictability to its interest rate decisions. The board's recent unexpected moves, including a rate cut in May and then holding rates steady in July despite market expectations, highlight a shift away from clearer forward guidance. This new approach, with a majority of external members whose policy preferences are not widely known, could lead to sharper swings in Australian bond and currency markets. U.S. Treasury Secretary Scott Bessent also commented on trade, suggesting that tariffs "should melt" if global trade rebalances, indicating a potential easing of trade tensions if economic conditions align.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.