Stock Markets, Bond Yields, Cryptos Are Exposed to a Trump Presidency. Here’s How and 4 Other Things to Know Today.

After the debate, traders appeared to bet a second Trump presidency would be more inflationary than a Democratic victory. The argument goes that his aim to restrict immigration and slap high tariffs on imports will drive consumer prices higher.

But for the moment, inflation appears to be slowing and interest rates could be heading lower. Bond yields have come down since the beginning of the month, and Federal Reserve Chair Jerome Powell has started expressing concern about the labor market—a good sign for rate cuts. Powell’s speech on Monday provides more details, and retail sales data Tuesday will take the pulse of the consumer.

In other news about Trump on Thursday, a Federal judge dismissed the criminal case against him alleging that he unlawfully took classified documents.

Republicans say they want the U.S. to be a dominant energy producer. Old-fashioned energy stocks may benefit from another Trump term, while clean energy stocks could suffer.

Banks may benefit from light-touch regulation.

BlackRock
,

Goldman Sachs
,

Bank of America
,

and

Morgan Stanley

all report earnings this week. Bitcoin was getting a boost early Monday, in part on speculation that a Trump administration would be kind to cryptocurrencies.

There could be other Trump trades. For example, new Trump tariffs or an escalated trade war with China might hurt semiconductor stocks such as

Nvidia
,

Intel, or

Super Micro Computer

—though as long as artificial intelligence optimism persists, it’s hard to count them out.

As the election gets closer, the Trump trades could get even more popular. Investors should stand ready to tweak their portfolios.

—Brian Swint

*** Join Barron’s senior managing editor Lauren R. Rublin, deputy editor Ben Levisohn, and Parnassus Investments’ Chief Investment Officer Todd Ahlsten today at noon when they discuss the outlook for financial markets, industry sectors, and individual stocks. Sign up here.

Republicans are converging in Milwaukee to formally nominate former President Donald Trump as their presidential candidate at their party convention this week. The event is moving forward after Trump was injured in a shooting in Butler, Pa., that the FBI is investigating as an attempted assassination.

• President Joe Biden said Sunday that he is grateful Trump is recovering and urged people not to jump to conclusions about the shooter or his motives. He expressed condolences to the family of Corey Comperatore, who was killed at the rally, and prayers for two critically injured attendees.
• Lawmakers called for unity and calm on Sunday. Speaker Mike Johnson (R., La.) told NBC News that the tone of discourse in the country needed to be tempered, while Sen. Bernie Sanders (I, Vt.) said, “What we need as a nation, what a democracy is about, is not radical rhetoric.”
• Biden said he asked for an independent review of the security at Saturday’s rally and will make the results public. Congress has called for a full investigation of the shooting. The House Oversight Committee said it invited Secret Service director Kimberly Cheatle to a hearing on July 22.
• Biden will receive an update from homeland security and law enforcement officials this morning, then take part in an interview with NBC’s Lester Holt in the afternoon before leaving for Las Vegas, The White House said. He is postponing a previously planned trip to Texas.

What’s Next: The Secret Service told reporters that there are no plans to change the security protocol for this week’s Republican National Convention. Trump arrived in Milwaukee Sunday evening. One question that remains to be answered is his pick of a running mate.

—Liz Moyer and Janet H. Cho

Netflix

has been outperforming its traditional media and streaming rivals, juicing sales and profit by cutting workers, raising its subscription rates, boosting its advertising, and cracking down on password-sharing. But it heads into this week’s second-quarter earnings report with another challenge ahead: live events.

• Sports and live events are where Netflix is still playing catch-up to

  Amazon.com
  ,

  Alphabet
  ’s

  YouTube,

  Walt Disney
  ,

  and

  Comcast
  ’s

  NBCUniversal, said eMarketer analyst Paul Verna. But it is pressing ahead with planned live broadcasts of NFL games, a Jake Paul-Mike Tyson boxing match, and other events.

• Netflix plans to stop reporting membership totals next year, saying time spent on the platform is a better measure of viewer satisfaction. Wedbush analysts said Friday they saw the move as part of a transition to a slower-growth, higher-profit business.
• That shift away from subscriber numbers means Netflix’s other financials and its content spending and ad revenue will become even more important, Verna told MarketWatch. Content continues to create buzz, including the second-quarter shows Baby Reindeer and Bridgerton’s third season.
• KeyBanc’s Justin Patterson wrote that Netflix’s strong content slate, including Christmas NFL games, returning series such as Squid Game, Cobra Kai, The Night Agent, and The Umbrella Academy, and new shows like Receiver, could fuel further gains for Netflix shares, which are up 33% this year.

What’s Next: Now that streaming competitors including

Warner Bros. Discovery
’s

Max, Comcast’s Peacock, and Paramount+ have all raised their prices, the chances of Netflix doing so have improved, Patterson wrote. It’s less clear if Netflix will do so now or wait until Squid Game and the NFL.

—Janet H. Cho and George Glover

Federal Reserve Chairman Jerome Powell will speak later today at the Economic Club of Washington, D.C., with investor expectations for an interest rate cut in September continuing to climb. More evidence of cooling economic trends could solidify that outlook with the release of the Fed’s Beige Book this week.

• The book is a periodic collection of anecdotes about current economic conditions gathered from the Fed’s 12 regional banks. Recent government data showed inflation is slowing, and the Beige Book could provide more color on where consumers and businesses are seeing softness.

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  JPMorgan Chase

  CEO Jamie Dimon said Friday that while there has been progress on inflation, prices and rates could stay elevated for longer. Consumer optimism about the economy dropped to an eight-month low in July over frustration with high prices, the Michigan Consumer Sentiment survey said.

• The housing market has also been a major factor in inflation. Another set of data is expected this week, including a reading on the single-family home outlook from the National Association of Home Builders, new residential housing starts for June, and building permits.
• All three major stock indexes rose after Powell seemed to suggest last week that the Fed was closer to rate cuts. The Dow Jones Industrial Average closed out last week at a new high above 40,000, and the S&P 500 also reached a new high, rising 18% this year.

What’s Next: Several of Powell’s Fed colleagues are also slated to speak this week and could give fresh insights on the possible timing of a cut. San Francisco Fed President Mary Daly speaks today at Fortune Brainstorm Tech 2024; and Fed Gov. Adriana Kugler speaks Tuesday in Washington.

—Janet H. Cho

As regulators heighten their scrutiny of competition in the tech industry, Alphabet’s Google is nearing a $23 billion deal for the cybersecurity firm Wiz. The deal would boost Google’s cloud computing operations and could be the search giant’s largest acquisition ever, The Wall Street Journal reported.

• A deal could come together soon, the report said, citing people familiar with the talks. Alphabet and Wiz didn’t respond to a request for comment from Barron’s, but Wedbush analyst Dan Ives called the combination a shot across the bow for rivals

  Microsoft

  and Amazon.

• In May, Wiz said it raised $1 billion at a valuation of $12 billion in a funding round led by Andreessen Horowitz, Lightspeed Venture Partners, and Thrive Capital. Wiz CEO Assaf Rappaport said then that “2024 is the year of consolidation—for Wiz, and the industry at large.”
• Google has been trying to catch up in the cloud computing space with Amazon and Microsoft. Two years ago, Google bought another security firm Mandiant for $5.4 billion. But the company also faces antitrust scrutiny from regulators, especially in its search business.
• Wiz’s founders started their company after selling an earlier start-up called Adallom to Microsoft in 2015, the Journal reported. They worked at the tech company for a while before leaving to found Wiz in 2020.

What’s Next: While the Biden administration’s Federal Trade Commission has gone after anticompetitive practices in the tech industry, a change could shift things, Ives said. Should former President Donald Trump win the election, “We would expect a very weak FTC and tech deals to accelerate,” Ives said.

—Liz Moyer