Key Points

• ASML shares drop 6.5% as 2026 growth remains uncertain despite Q2 earnings beat
• Central banks ramp up domestic gold purchases to boost reserves as prices surge past $3,328/oz
• Rolls-Royce invests $75M to expand South Carolina plant, targeting U.S. data center demand
• GM shifts Escalade and truck production to Michigan, expanding gas-powered output amid strong demand
• Tesla’s North America sales chief exits as executive turnover grows and sales slump persists

Preview

Global markets are reacting to mixed corporate signals and shifting trade dynamics. ASML’s 6.5% share drop underscores semiconductor sector uncertainty, while central banks boost gold reserves as prices hit record highs. Rolls-Royce and GM are expanding U.S. production to capture resilient domestic demand, even as Tesla faces leadership churn amid declining sales. Investors remain focused on trade policy shifts, supply chain realignments, and the outlook for key growth sectors heading into the second half of 2025.

ASML Shares Drop on Uncertain 2026 Outlook Despite Q2 Beat

ASML shares fell 6.5% after the Dutch semiconductor equipment giant warned it could not confirm growth in 2026, citing macroeconomic and geopolitical uncertainty. The company reported Q2 net sales of €7.7 billion and net profit of €2.29 billion, both beating estimates, with net bookings surging to €5.5 billion. However, its Q3 revenue guidance of €7.4–7.9 billion missed market expectations of €8.3 billion, and full-year 2025 sales growth was narrowed to 15%. AI-driven demand remains a key driver, with strong EUV orders, but tariff and geopolitical risks weigh on the longer-term outlook.

Investment Insight:

While ASML’s AI-related demand continues to underpin strong bookings, the cautious 2026 guidance signals a potential plateau in semiconductor capital expenditure amid global trade and economic headwinds. Investors may view the stock’s recent pullback as an opportunity, but sustained upside likely hinges on the High NA EUV tool adoption pace and clarity on U.S.-China trade policy.

Central Banks Turn to Domestic Gold as Prices Soar

Central banks are increasingly sourcing gold directly from local mines to bolster reserves, save costs, and support domestic industries amid record-high prices. According to the World Gold Council, 19 of 36 surveyed central banks now buy from domestic miners, up from 14 last year, with Ghana, Tanzania, Colombia, and the Philippines among the most active. Spot gold trades at $3,328.3 per ounce, up 27% year-to-date, making local purchases an attractive hedge while conserving foreign exchange reserves.

However, reliance on artisanal mining raises concerns over labor practices and environmental standards, though central banks could help formalize supply chains.

Investment Insight:

Rising central bank demand, especially from gold-producing nations, is reinforcing bullish momentum in the metal, which remains a key hedge against geopolitical and currency risks. Investors should monitor producer nations with growing domestic purchases, as reduced international supply may sustain upward price pressure. Gold miners in emerging markets could benefit from direct central bank agreements, while refiners with London Good Delivery certification remain strategically positioned to capture additional processing demand.

Rolls-Royce Invests $75 Million to Expand South Carolina Plant

Rolls-Royce will invest $75 million to expand its Aiken, South Carolina, facility, boosting production of mtu Series 4000 diesel engines used in backup power systems for data centers and critical infrastructure. The expansion will create 60 new jobs and shift more component machining to the U.S., reducing reliance on German production.

The move underscores Rolls-Royce’s growing focus on energy and power systems, complementing its aerospace business. Production at the expanded site is expected to begin in July 2027, positioning the facility as a key hub in its North American power systems strategy.

Investment Insight:

The expansion highlights Rolls-Royce’s strategic pivot toward the high-growth data center and energy infrastructure markets, providing diversification beyond aerospace. The localization of production strengthens its U.S. market position and aligns with trends favoring domestic manufacturing for critical infrastructure.

Investors should watch for potential revenue growth in power systems and long-term margins as domestic production scales and data center demand accelerates.

GM Expands Production of Gas-Powered SUV, Trucks in Michigan

General Motors announced it will move production of the Cadillac Escalade to its Orion Assembly plant in Michigan and expand manufacturing of Chevrolet Silverado and GMC Sierra pickups to meet strong demand. Production is set to begin in early 2027, complementing existing output at plants in Texas and Indiana. The move is part of GM’s previously announced $4 billion U.S. investment and reflects a strategic pivot amid slower-than-expected EV adoption. Orion Assembly, initially slated to become an EV-exclusive facility, will now be retooled for gas-powered models.

Investment Insight:

GM’s decision underscores persistent consumer demand for profitable gas-powered SUVs and trucks, even as EV adoption lags. This strategic adjustment could bolster near-term cash flow and margins, supporting the company’s U.S. investment plans. However, the shift also raises questions about GM’s long-term EV transition timeline, signaling that investor focus should remain on balancing legacy vehicle profitability with eventual EV growth targets.

Tesla’s Top North American Sales Executive Leaves Amid Slump

Tesla confirmed the departure of Troy Jones, its vice president of sales, service, and delivery in North America, amid a steep decline in sales and growing executive turnover. The move follows other high-level exits, including a key AI executive and a top aide to CEO Elon Musk. Tesla has been attempting to revive demand through refreshed vehicle models, low-cost financing, and the launch of its robotaxi service in Austin. However, competition in the EV market and Musk’s political visibility continue to weigh on Tesla’s brand and margins.

Investment Insight:

Executive churn at Tesla raises concerns over internal stability as it faces declining sales and mounting competition. While long-term upside may come from Full Self-Driving technology and robotics initiatives, near-term risks remain elevated, with margins likely to stay under pressure. Investors should watch for delivery and margin updates in upcoming earnings to gauge the effectiveness of Tesla’s demand-boosting measures.

Conclusion

Markets are navigating a mix of technology headwinds, strategic industrial shifts, and geopolitically driven trade flows. ASML’s cautious 2026 outlook underscores cyclical and export-policy risks in semiconductors. Central banks are deepening gold reserves through domestic sourcing amid record prices. Industrial activity remains robust as Rolls‑Royce and GM expand U.S. manufacturing in response to energy and trade dynamics.

Tesla’s executive exit highlights mounting pressure in electrified auto markets. Investors should monitor how policy, tariffs, and demand trends intertwine with corporate guidance and capital allocation as the second half of the year unfolds.

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