0730 | Microsoft’s record $450B rally, Fed pushback, US-Iran strikes resume, IPO split

Mia: This is After Market, a Bri podcast. I'm Mia.

Milo: And I'm Milo. Microsoft just had the biggest single-day gain in stock market history. The Fed chair says he's determined to fight inflation, but Wall Street isn't buying it. The US and Iran are trading strikes again after a short pause. And two big IPOs hit the market with very different first-day results.

Mia: Microsoft added roughly $450 billion in market value in a single day.

Milo: That is the largest one-day dollar gain ever recorded for any stock. Ever.

Mia: And it came on the back of a quarterly report that featured record cloud revenue. The numbers just blew past expectations.

Milo: But the week isn't over. Apple and Amazon are scheduled to report earnings after the bell, and the options market is signaling that their results could determine whether a rough week finishes on stable ground.

Mia: Meanwhile, Wall Street analysts are pointing out something interesting: several smaller renewable and AI-linked stocks may currently offer better buying opportunities than the major oil companies, which are about to announce booming profits.

Mia: Federal Reserve Chairman Kevin Warsh says he is determined to restore the central bank's credibility as an inflation fighter.

Milo: But he spent Wednesday defending the decision to hold rates steady yet again. And some investors argue it is past time for Warsh to deliver clearer guidance on where the Fed is headed.

Mia: Bloomberg ran the piece under the headline, Wall Street Delivers Harsh Verdict on Warsh Fed.

Milo: On Bloomberg Real Yield, Columbia Threadneedle Investments portfolio manager Ed Al-Hussainy called the Fed's messaging, quote, extraordinarily muddled, and likened the situation to a hall of mirrors where he has no clear idea of Warsh's actual policy position.

Mia: Long-term Treasury yields kept most of the surge set off by the latest rate announcement. That move was sustained by further US economic data that showed still-elevated inflation alongside a resilient labor market.

Milo: Al-Hussainy was joined on the program by Azimut Group global co-head of fixed income Nicolò Bocchin, TCW Group CIO Bryan Whalen, and CreditSights global head of credit strategy Winnie Cisar. The episode's framing described the return of bond vigilantes and posed a direct question about the Fed's credibility.

Mia: Separate analysis notes that Warsh was effectively rebuked by investors who are craving a genuine inflation fight, leaving his standing in question after rates were left unchanged once more.

Mia: Fighting between the US and Iran has resumed after a brief lull.

Milo: American strikes are focused on military targets, while Tehran-aligned forces are targeting US partners in the region. Israel has so far remained outside the latest exchange, following Prime Minister Benjamin Netanyahu's in-person talks with President Donald Trump.

Mia: Former California Democratic congresswoman Jane Harman said the US war in Iran has made every country in the Middle East a target, even countries that have not yet been participants in the conflict.

Milo: She added that the danger of the conflict spreading is huge and the US defense industrial base may not be prepared to address conflicts worldwide.

Mia: Egypt separately said a drone hit two ships at its Mediterranean port, as attacks on energy infrastructure widen.

Milo: And here's the flip side: US refiners running all-out to meet a global fuel shortage just posted some of their most profitable quarters ever. Years of domestic refinery closures and wars have tightened supplies worldwide.

Mia: Jersey Mike's Subs shares sank 6% on their first trading day.

Milo: The company and some shareholders raised $1 billion in a US IPO that priced at the midpoint of the marketed range. CEO Charlie Morrison discussed the debut, a cyclospora outbreak, and customer demand on Bloomberg Television.

Mia: Separately, sustainable womenswear brand Reformation, backed by Permira, closed barely changed on its first day after raising $210.9 million. That offering priced at the bottom of its marketed range.

Mia: Ferrari CEO Benedetto Vigna says he is pleased with the launch of the all-electric Luce, despite significant criticism upon its spring debut.

Milo: He told reporters he would not change anything.

Mia: Ferrari also raised its 2026 guidance after beating Wall Street's second-quarter expectations, citing what it calls healthy product demand.

Milo: In other consumer news, Starbucks CEO Brian Niccol reports seeing more customers coming into stores more often, and says the company is seeing strong sales across the board. He also expressed optimism about 2027.

Mia: That's After Market for today. I'm Mia.

Milo: And I'm Milo. Thanks for listening.