Loews' Hidden Empire & Apple's U.S. Investment

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**Ann Berry** (0:27)
Loews, no, not that one. We answer a question from the audience about the holding company that is Loews and the billionaire family that controls it. Apple, investing another $30 billion into US chip production. We look at the company's latest move to shore up its domestic supply chain. And the ceasefire collapse, we have the latest from the conflict in the Middle East and its effects seen today across the markets. For Wednesday, July 8th, it's Brew Markets Daily, and I'm Ann Berry.
More market details to come, but first, a volatile trading session unfolded today as the United States launched a new wave of strikes against Iran, and also revoked a temporary license that had allowed Iran to openly sell crude oil in the world market. Well, Iran immediately warned that it would, quote, take whatever measures it deems necessary, altogether putting the Middle East at risk of a wider conflict again. President Trump also saying that the memorandum of understanding to reach peace in which it was brokered just weeks ago is now, quote, over. Well, the administration says that US forces carried out powerful strikes on Iranian military targets after commercial shipping came under attack. And while in conversation with Ukraine's President Zelensky at today's NATO summit in Turkey, President Trump said that US action could extend to strikes on Iran's desalination plants, a threat to the nation's water supply and a material escalation if in fact enacted. He also mused that the US could take over Karak Island, which is located in the Persian Gulf and serves as Iran's primary oil terminal, handling roughly 90% of the country's crude exports. While the renewed fighting is making waves through global markets, we saw oil prices jump up around 4 to 5%. That's as concerns grew over security in the Strait of Hormuz, one of the world's most important shipping lanes for energy supplies. Investors are now watching closely for signs as to whether the conflict could spread further across the region. Well, to take a quick trip through some of the stocks and their reactions, we did see travel stocks dropping, notably the airlines, with American and United down around 1.5%.
Delta also in that range, and that's ahead of its earnings due out this Friday. Refiners and energy names moved higher, somewhat predictably. We saw Marathon Petroleum and Valero gaining more than 4%, and PBF Energy jumping over 9%.
And then there's defense stocks, which is sort of telling actually in the context of the market overall, because this sector initially caught a bid, with Northrop Grumman and Lockheed Martin rising around 1% as investors priced in higher geopolitical risk and possibly military action. But as the trading day progressed, shares in both companies ticked down into the red, reflecting frankly the overall market response, which was just not as dire as this kind of geopolitical incident would typically induce, suggesting that investors think a resolution is ultimately still likely but with the uncertainty being when. We're going to keep on watching.
Later into the show, we dive into a question from the audience about Loews, which is the holding company behind Loews Hotels. But it also holds energy, insurance and industrial assets. First, though, a few headlines from the day's trading session, kicking things off with Apple and another commitment to domestic manufacturing. Well, the iPhone maker is ramping up its continued investment in the United States, making chips with plans to spend more than $30 billion with Broadcom over the next five years. Broadcom does already supply Apple with connectivity chips, including Wi-Fi and Bluetooth components.

**John Carteau** (4:11)
But Apple's move today will lead to the production of over 15 billion additional chips on US soil, including an investment of $1.5 billion to, quote, expand and modernize Broadcom's manufacturing facility in Colorado.
The move is the latest step in Apple's pledge to invest over $600 billion in the US over four years. The company is already committed to buy chips from the new manufacturing facility that TSMC is building in Arizona. And Apple recently struck a deal with Intel to make some of its chips in the United States. Shares in Broadcom, the $1.9 trillion market cap company, rose nearly 6% today on the announcement. And shares in Apple also up around 1.5%.

**Ann Berry** (4:52)
We're going to ride out of the headlines with Waymo, the RoboTaxi division of Alphabet. Well, if you live in San Diego, Las Vegas, Tampa or Denver, you're soon going to see the driverless cars zooming around town. Well, for now, only Waymo employees will get to hitch a ride, but the company is planning to launch public trips in those cities soon. And it's all part of Alphabet's goal for the division to hit 1 million weekly trips by the end of this year.