On Monday, Broadcom shares rallied after the chipmaker extended its long-term partnership with Apple through 2031, reinforcing its position in the iPhone maker’s supply chain.
Strategy disclosed that it sold $216 million worth of Bitcoin under its newly introduced treasury framework while reporting a sharp quarterly loss on its digital assets.
Oil prices were little changed as Saudi Arabia cut its official selling prices and OPEC+ approved another production increase beginning in August.
Gold prices slipped from two-week highs as a stronger US dollar weighed on bullion, although expectations of a less aggressive Federal Reserve helped limit losses.
Broadcom extends Apple partnership through 2031
Broadcom Inc. (AVGO) shares rose 4.6% on Monday after the semiconductor company announced an extension of its long-standing partnership with Apple Inc. through 2031.
The new multi-year agreement expands the companies’ collaboration on custom silicon products and strengthens Broadcom’s position as one of Apple’s key chip suppliers.
Analysts estimate Apple contributes about 20% of Broadcom’s annual revenue, making the relationship strategically important for the chipmaker.
According to a recent SEC filing, Broadcom and Apple have entered into new long-term agreements covering a range of custom ASIC silicon products that will be used across multiple generations of Apple devices.
Broadcom has long supplied Apple with radio-frequency chips, Wi-Fi and Bluetooth connectivity chips and other networking semiconductors.
The companies had previously announced a multibillion-dollar agreement in 2023 to develop and manufacture 5G radio frequency components.
Apple also continues to rely on Taiwan’s TSMC to manufacture its M-series and A-series processors while exploring potential US manufacturing with Intel.
Strategy sells $216 million worth of Bitcoin
Strategy Inc. (MSTR), formerly known as MicroStrategy, disclosed that it sold 3,588 Bitcoin for approximately $216 million last week as part of its new Digital Credit Capital Framework.
The company sold 1,363 Bitcoin between June 29 and June 30 for $80.8 million before selling another 2,225 Bitcoin between July 1 and July 5 for $135.2 million.
Following the transactions, Strategy’s Bitcoin holdings declined to 843,775 coins acquired at an average purchase price of about $74,476 per Bitcoin.
Proceeds from the sale were used to fund preferred stock distributions and replenish the company’s US dollar reserve, which stood at approximately $2.6 billion as of July 5.
The company also introduced a BTC Monetization Program allowing it to sell up to $1.3 billion worth of Bitcoin for reserve management, dividend payments and share repurchases.
Oil prices steady as OPEC+ boosts output
Oil prices traded little changed on Monday as markets weighed Saudi Arabia’s aggressive pricing strategy, OPEC+’s latest production increase and the continued recovery in exports through the Strait of Hormuz.
Brent crude fell by 0.07% to $72.05 a barrel, while US West Texas Intermediate crude gained 0.06% to $68.65 a barrel.
Saudi Arabia reduced the official selling price of its flagship Arab Light crude for Asian buyers by $1.50 per barrel versus the Oman/Dubai benchmark for August, marking its largest monthly price cut since Reuters records began in 2003.
Meanwhile, OPEC+ agreed to increase production targets by another 188,000 barrels per day beginning in August.
Analysts noted that although production targets continue to rise, actual output has remained constrained in recent months because the conflict involving Iran disrupted tanker traffic through the Strait of Hormuz.
Gold slips as stronger dollar offsets Fed expectations
Gold prices retreated from two-week highs on Monday as a stronger US dollar weighed on bullion prices.
Spot gold fell 0.31% to $4,162.46 per ounce after reaching its highest level since June 22, while US gold futures for August delivery rose 1.15% to $4,172.70 per ounce.
Recent US labor market data showing slower job growth and downward revisions to prior payroll figures have reduced expectations of additional Federal Reserve interest rate increases, helping limit gold’s decline.
JP Morgan said in a note that demand for gold from key sectors is likely to be weaker than previously expected, forecasting gold prices of $4,300 per ounce in the third quarter and $4,500 per ounce in the fourth quarter.
This post Evening digest: Broadcom extends Apple deal, Strategy sells $216M worth of Bitcoin may be modified as updates unfold
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