July 10 (Reuters) - The results season is kicking off with the world's largest chipmaker and key U.S. banks reporting, while data out of the U.S. and China will give a fresh perspective on the state of growth, inflation pressures and trade flows.
Here's all you need to know about the coming week in financial markets by Wen-Yee Lee in Taipei, Rocky Swift in Tokyo, Amanda Cooper in London and Lewis Krauskopf in New York.
1/CHIP CHIP HURRAH
The world's largest manufacturer of advanced AI chips, Taiwan's
TSMC will report second-quarter earnings on Thursday.
The results come days after South Korean memory-chip giant SK Hynix pulled off a blockbuster $26 billion U.S. share sale, and amid a rising debate on whether the AI-fuelled semiconductor rally still has further to run.
TSMC, Asia's most valuable listed company and a key supplier to Nvidia, Apple, AMD and Broadcom, is expected to offer one of the clearest readings yet on AI demand. Investors will be keen to see whether it upgrades its 2026 revenue growth and capital spending forecasts.
The company said last month it was scrambling to keep up with relentless AI demand and avoid becoming a bottleneck in the chip supply chain, while also hinting it would like to raise prices for customers.
2/BANKING ON IT
The U.S. earnings season gets under way next week, with Wall Street's biggest banks setting the tone for what investors hope will be another strong quarter for corporate America.
Five of the six largest U.S. lenders, including JPMorgan Chase and Goldman Sachs, report on Tuesday followed by Morgan Stanley a day later. Trading desks are expected to have had a bumper quarter as market volatility kept investors busy.
Beyond the banks, investors will also hear from a string of heavyweight names including Netflix, BlackRock and Johnson & Johnson.
Expectations are running high. S&P 500 companies are forecast to post a hefty 23.4% jump in second-quarter earnings from a year ago, according to LSEG IBES, after first-quarter profits came in much stronger than many had expected.
3/HOLDING OUT FOR HORMUZ
U.S. President Donald Trump's declaration that an interim ceasefire agreement with Iran is "over" has fired up volatility across all markets. Oil has briefly topped $80 a barrel, serving a reminder of the risk of another pickup in inflation.
Crude flows through the Strait of Hormuz are picking up, which should help keep a lid on prices. But with the U.S. and Iran trading blows, there is little visibility on whether that pace can be sustained, or increase meaningfully.
Traders have loaded up on options that give them the right to buy Brent futures above the current price by the end of July - a sign many believe oil might look cheap right now.
LSEG data shows the biggest jump in holdings was for options to buy crude between $86 and $91 a barrel by the end of July. The caveat is they have also maintained their largest holdings - options to sell Brent at either $69 or $70.
4/PRICE CHECK
A packed week of U.S. economic data could give investors their clearest read yet on whether inflation is cooling - or proving stubborn enough to keep the Fed on its toes.
The spotlight falls on June consumer price inflation on Tuesday, followed by producer prices a day later. Thursday's retail sales figures will offer another clue to the strength of the U.S. consumer, whose spending has been a key support for the economy.
Fears that the economy was running too hot abated after a softer-than-expected June jobs report, but investors are still trying to gauge how worried the Federal Reserve is about inflation, consistently running ahead of the 2% annual target. Minutes from the Fed's June meeting showed policymakers remained uneasy about price pressures under new Chair Kevin Warsh.
Warsh himself is expected to deliver his first testimony on monetary policy before Congress on Tuesday.
5/CHINA CHECK
Chinese data will be closely watched for signs of how the AI boom and Iran war are impacting the world's second-biggest economy.
Trade has been one of the few bright spots as Beijing tries to steer growth away from its long-troubled property sector and towards domestic consumption, which remains sluggish.
Export data on Tuesday are expected to show shipments rising 18.0% year-on-year in June, slightly cooler than the 19.4% expansion seen in May, which was driven by demand for chips and other technology goods.
The bigger test might come on Wednesday, when China reports second-quarter GDP, with growth expected to slow to 4.5% year-on-year. The economy expanded 5% in the first quarter, beating forecasts and at the top of Beijing's growth target, but most of the period was before war broke out in Iran, roiling energy markets.
(Graphics by Mayank Munjal, compiled by Karin Strohecker, Editing by William Maclean)
