In a bid to diversify its AI partnerships in this ever-expanding AI boom, Microsoft announced partnership with French startup Mistral AI, a company established just a year ago. While the financial details remain undisclosed, the deal dwarfs Microsoft's billion-dollar investment in OpenAI. Mistral, which no longer boasts an "open-source" approach under Microsoft, unveiled its flagship model, "Mistral Large," exclusively on Microsoft's Azure cloud. This multilingual model, claiming top-tier reasoning capabilities, rivals OpenAI's GPT-4 in cost effectiveness. Additionally, Mistral also released "Le Chat," a user-friendly AI assistant designed to showcase its diverse AI applications and rival the wildly popular ChatGPT.


Wall Street took a breather after a phenomenal AI rally, closing a bit lower on Monday as key economic data in queue could influence the Federal Reserve's timeline. While energy stocks gained on rising oil prices, the broader market traded cautiously, with utilities leading the declines. As the market shifts its focus off tech stocks for now, some undervalued sectors may regain some of the valuation lost earlier on the AI rally.


Gold prices are currently flat, awaiting key U.S. inflation data later this week that could influence future interest rate decisions. While the data suggests a strong U.S. economy and delays in rate cuts, rising Treasury yields are putting pressure on gold's appeal as an asset. Investors are also cautious about a potential U.S. government shutdown later in the week.


Faster inventory drawdowns caused by Red Sea trade disruptions have led Goldman Sachs to raise its summer Brent crude price forecast to $87 per barrel. Goldman expects OPEC+ to maintain production cuts through the first half of 2024 while its spare capacity offers some buffer against disruptions, limiting downside risk below $70. India increased its peak electricity demand projection for FY 2031–2032 by 5% due to a surge in 2023 and is planning to add cheaper coal-fired power capacity in 2024 to meet immediate needs.


The dollar continued to decline slightly ahead of key US economic data as hopes for an imminent Fed rate cut faded. Markets are cautiously awaiting inflation and durable goods orders figures this week. The Japanese yen strengthened on stickier inflation, raising expectations for the Bank of Japan to tighten policy sooner. Other Asian currencies saw modest gains, with investors awaiting regional economic data releases.