Taiwan Semiconductor Manufacturing Co. reported a 67.9% year-on-year rise in its June sales on Monday, ahead of its second-quarter earnings release later this week.

For the first half of 2026, TSMC’s total revenue reached 2.4 trillion new Taiwan dollars ($74.99 billion), representing a 35.6% increase compared to the same period in 2025. TSMC reported June revenue of NT$ 442.68 billion — a 6.2% increase from the previous month.

The Taiwanese chip giant’s shares were trading 1% higher Monday.

The company’ growth has been boosted by demand for artificial intelligence chips and infrastructure investments. 

The world’s largest contract chipmaker manufactures semiconductors for a wide range of applications, spanning from smartphones to high-performance AI computing systems, with key clients including U.S. technology leaders such as AI darling Nvidia, Apple and Advanced Micro Devices.

TSMC plans to add two advanced chip packaging plants in the Chiayi Science Park in southern Taiwan, Reuters reported, citing remarks made by Taiwan’s National Science and Technology Council Minister Wu Cheng-wen on Sunday. Wu noted that the site’s first facility is already in mass production, with the second expected to begin shortly. 

TSMC, which commands a 73% share of the global pure-foundry market — chips manufactured for clients — in the first quarter of 2026, according to data from Counterpoint Research, is set to report its second-quarter earnings on Thursday, July 16. 

Elon Musk’s Neuralink, which uses implants in people’s heads to compensate for disabilities, has become the poster child for so-called brain-computer interfaces (BCI). But some companies are betting that mass-market neural tech won’t require opening the skull at all.

BCI works by processing brain signals and translating them into commands, allowing external devices to be controlled by thought.

Funding for startups in the field is a fraction of the capital flowing into artificial intelligence. But interest in the nascent field is rising as companies notch up milestones, such as enabling people with degenerative conditions including amyotrophic lateral sclerosis (ALS) to type or play video games using brain signals.

AI is a catalyst, boosting signal-processing capabilities. Some in the industry envision a further leap one day: using the mind to control or connect with AI and robots.

The technology is raising the stakes in the U.S.-China rivalry. The Chinese government included BCI as a strategic “future industry” in its latest Five-Year Plan. Regulators recently approved what officials call the world’s first minimally invasive BCI device for commercial use, developed by Neuracle Medical Technology to regain some hand function after spinal cord injuries.

While companies including China’s StairMed and NeuroXess push ahead with implants, the non-invasive field is gaining momentum – from the Sam Altman-backed Merge Labs to China’s Gestala, both pursuing ultrasound-based approaches.

BrainCo, one of the so-called “six little dragons” of tech startups in the eastern city of Hangzhou, makes prosthetics and wearable devices using BCI technology.

Rui Ma, founder of the Tech Buzz China media and research platform, said that while today’s proven BCI applications can dramatically improve the quality of life for severely impaired patients, the far bigger market likely lies in augmenting human capabilities.

But she added: “I don’t think anyone is remotely close to realizing that … . Augmentation is like sci-fi at this point.”

Founded in 2015 and born out of the Harvard Innovation Labs, BrainCo has planted its flag on the non-invasive side.

The implanted and non-invasive approaches are different paths to different problems, BrainCo partner and senior vice president Nyx He told CNBC in a recent interview. Some conditions can only be addressed by going into the brain, she said, but BrainCo believes many others – particularly where drugs fall short – can be served by non-invasive methods that are easier for people to accept and access, at lower risk and cost.

The company’s bionic hands, approved by the U.S. Food and Drug Administration, read an amputee’s neural and muscular electrical signals and translate intended movements into finger motions. Its wearables include a sleep aid that BrainCo says uses low-intensity electrical pulses to stimulate neurochemicals associated with stress relief.

BrainCo has raised 2 billion yuan ($280 million) in a funding round co-led by IDG Capital and Walden International, the venture firm founded by Intel CEO Lip-Bu Tan.

The core challenge for non-invasive methods, according to He, is acquiring and decoding brain signals, which are subtle and noisy when read from outside the skull. BrainCo developed a dry electrode sensor to capture the signals and an AI algorithm to decode them.

He outlined the company’s roadmap in stages: start with those who need the technology most, such as amputees in markets covered by insurance; expand into medical conditions like ADHD and depression; then target the mass market with consumer electronics.

Eventually, BrainCo plans to license its BCI platform to other companies building brain-tech products – a business she expects to become the company’s largest revenue driver.

The startup’s plan echoes thinking emerging at the national level. In a state-media commentary this week, a Chinese Academy of Sciences researcher specializing in non-invasive BCI laid out a similar trajectory: from medical applications in the near term, to uses in autonomous driving and smart manufacturing, and ultimately to mass-market consumer products.

Investors are split over the best technological approach. But most agree the real test is whether companies can build products that offer clear improvements — and that consumers will pay for.

Some argue only implants can deliver. “Non-invasive is like trying to capture light in distant galaxies,” said Alex Zhavoronkov, CEO of biotech firm Insilico Medicine.

Others see promise in emerging non-implanted techniques. Thomas Tsao, cofounder of Gobi Partners, a venture capital firm that has invested in Gestala, said ultrasound-based approaches offer a more holistic view of the brain without surgical risk.

Growing investment could help the industry reach a tipping point, Tsao said, but added its ultimate market size is virtually impossible to quantify, with many future use cases hard to imagine today.

Jefferies, in a July 8 report, said invasive implants and ultrasound-based methods represent the “most promising” frontiers, noting that conventional non-invasive systems remain constrained by how clearly they can capture and interpret brain signals. But the bank added that BrainCo’s proprietary sensors, AI decoding algorithm and commercialization record give the company an edge.

Industry players say the best approach depends on the use case: recording or stimulating brain activity, aimed at patients or consumers, used briefly or continuously, targeting surface or deep brain regions, and how much burden users are willing to bear.

If American neurotechnology is bankrolled by billionaires, China’s has the backing of the central government.

In Beijing, seven ministries jointly issued an implementation plan for the BCI industry in August last year, targeting key technological breakthroughs by 2027. In June, the provincial government of Anhui published an action plan to fast-track BCI development across research, production and industrialization.

Some startups in China, facing pressure from state-linked or risk-averse backers to show revenue, have turned to selling equipment or consumer-grade products, said Tech Buzz China’s Ma, while U.S. investors prefer the “world-changing bet.”

For now, China’s BCI market is taking off first in non-invasive rehabilitation technologies, Jefferies said, which face lower regulatory and clinical barriers.

“China has now incorporated BCI into its industrial policy apparatus,” said Paul Triolo, a partner at consultancy DGA-Albright Stonebridge Group. “Beijing thinks in terms of not just one breakthrough technology, but the whole supply chain.”

The country’s focus is also broader, he said, from stroke rehabilitation to prosthetics to cognitive assessment.

That coordination extends to hospitals and universities. Shanghai has paired BCI startups with Huashan Hospital, broadening access to patients and neurosurgeons. China’s health authorities also created a separate insurance category for BCI last year, which experts say could help to scale up the technology.

Like AI and semiconductors before it, BCI – with its sensitivities around intimate personal data and privacy – could become a geopolitical flashpoint as it matures. Performance-enhancing uses also raise ethical considerations.

BrainCo’s He said the company doesn’t collect customer data, which is stored on users’ devices, not transmitted to the cloud and erased after each use. Information such as concentration scores could also be saved locally on focus-training devices, He said.

Asked about tensions between the world’s two tech powers, she brushed the politics aside.

He said the company’s goal is to deliver solutions to those in need, whether in China or the U.S. “I don’t think I’ll stop at borders for that.”

Ukraine has stepped up its attacks on Russian fuel tankers in the Sea of Azov, seeking to disrupt supplies to occupied Crimea at a time when drone strikes have triggered nationwide gasoline shortages.

Ukraine’s drone force commander, Robert Brovdi, known as Magyar, said via Telegram that 14 Russian ships were hit in the Sea of Azov on Thursday evening, taking the number of Russian vessels stuck by Ukrainian drones to 35 over the last 96 hours. CNBC could not independently verify this report.

The drone strikes form part of Ukraine’s campaign designed to choke off supplies and transportation routes in and out of Crimea, which Russia seized by force in 2014.

Situated off the southern shores of both Ukraine and Russia, the Sea of Azov is a shallow inland sea that sits to the northeast of the Crimean Peninsula.

Defense experts and strategists have described Ukraine’s drone attacks as pivotal in helping to stall Russia’s military momentum, while also warning that Kyiv’s deep-strike successes have drastically raised the risk of escalation.

“The Ukrainians have successfully brought the war into the mindset and the reality of Russian life,” Beat Wittmann, chairman and partner at Porta Advisors, told CNBC’s “Squawk Box Europe” on Friday.

“The reaction can be escalate or back down and negotiate, and historically the action, of course, in such situations is escalation. So, I would except that they escalate from [an] increasingly difficult situation and that will happen within the next few months,” Wittmann said.

Ukraine has frequently targeted high-profile oil refineries in major cities such as Moscow and St. Petersburg in recent weeks as part of a sustained push to cut off Russia’s energy revenues.

Earlier this week, Ukraine marked what appeared to be one of the country’s deepest attacks on Russian territory in the war so far.

Plumes of black smoke were seen billowing from a key oil refinery in the city of Omsk on Tuesday, prompting Ukrainian President Volodymyr Zelenskyy to declare that the country’s upgraded drone capabilities have put Siberia “within reach.”

The Omsk facility is situated nearly 2,500 kilometers (1,553 miles) from Ukrainian territory and close to Russia’s border with Kazakhstan.

Long queues have been seen at Russian petrol stations as the country grapples with a worsening fuel crisis. Indeed, Russia’s president, Vladimir Putin, recently acknowledged the impact of Ukrainian drone strikes on Russian fuel production for the first time.

Holger Schmieding, chief economist at Berenberg, said the “costs of war are mounting” for the Kremlin.

Russian gross domestic product, or GDP, growth stalled in the first quarter, according to official data, following a sharp slowdown last year and a temporary boost from surging military spending in 2024 and 2023.

“While the private sector seems to be contracting due to labour shortages, a scarcity of some materials and high interest rates, the military sector continues to thrive,” Schmieding said in a research note published Friday.

“Unless the Strait of Hormuz is closed again for a sustained period of time, sending energy prices and Russian export proceeds skywards, Russia’s economic and fiscal situation will likely worsen significantly further,” he added.

Russia is still open to diplomatic talks with Ukraine, Kremlin spokesman Dmitry Peskov said Friday, accusing Kyiv of lacking the willingness to move toward a peaceful settlement.

“Russia remains open to achieving its goals through peaceful political and diplomatic negotiations, and President Putin remains open,” Peskov said, according to Russian state news agency RIA Novosti.

“But in circumstances where this is impossible, due to the Kyiv regime’s lack of willingness, we are continuing the special military operation,” he added, per a translation.

Ukraine’s Zelenskyy penned an open letter to Russia’s Putin last month, proposing talks and saying Kyiv is ready for a full ceasefire for the duration of the negotiations. Putin responded by saying he saw no point in an in-person meeting with Zelenskyy for now.

Volkswagen‘s management plans to drastically reduce its model lineup and further cut capacity, although the German auto giant stopped short of announcing sweeping job cuts following tense stakeholder talks.

Europe’s largest automaker on Thursday said the model lineup will be gradually cut by up to half over the coming years as it concentrates on the most attractive market segments.

Production capacity, meanwhile, will be reduced to nine million vehicles per year, compared to a goal of 12 million before the coronavirus pandemic.

“With our future plan, we are moving into the next phase of transformation by our own means. We are making the Volkswagen Group faster, more resilient and more competitive,” Volkswagen CEO Oliver Blume said in a statement.

The update followed a high-stakes boardroom showdown with the group’s supervisory board on Thursday and comes after reports that the company is weighing up shutting four German factories and implementing as many as 100,000 job cuts.

The mass layoff plan, which would represent the most radical overhaul in the firm’s nearly 90-year history, is staunchly opposed by German lawmakers and powerful labor unions.

Volkswagen’s labor representatives were said to have blocked a restructuring of the company at Thursday’s meeting, Reuters reported, citing two unnamed sources. Volkswagen was not immediately available to comment when contacted by CNBC on Friday.

The auto giant had already laid out plans to implement sweeping job cuts and launched a major product offensive, seeking to counter pressures ranging from U.S. import tariffs to intensifying competition from Chinese car brands.

The latest reported layoffs, however, would be double the 50,000 job cuts previously announced and now purportedly include the closure of four German plants: Hanover, Zwickau, Emden, and the Audi facility in Neckarsulm. The plans were first reported by Manager Magazin late last month.

Analysts at Jefferies said on Thursday that Volkswagen’s rescue plan provided “limited new information” and “no indication of progress” toward an agreement having been reached on either plant closure, a five-year investment plan or additional headcount reduction up to 100,000.

Volkswagen’s General Works Council and German industrial union IG Metall have pledged to push back against the reported job cuts and plant closures. A protest organized by IG Metall took place on Thursday outside Volkswagen’s plant in the German city of Zwickau.

Shares of Volkswagen were last seen trading 0.8% lower on Friday morning. The stock, which has recently been trading at levels not seen since the summer of 2010, is down more than 30% so far this year.

“If you look at the stock price, it tells you a story,” Henning Gebhardt, partner and fund manager at HollyHedge Consult, told CNBC’s “Europe Early Edition” on Friday.

“Volkswagen is in a perfect storm: Competition from Chinese competitors is very high so there’s no real profit from China, you have tariffs, you have other competitors which are actually having a nice offering, which Volkswagen at the moment doesn’t have, and then generally speaking, the auto industry is under pressure,” Gebhardt said.

India will supply its BrahMos and Astra missiles to Indonesia, the country’s third such agreement in the Indo-Pacific, underscoring New Delhi’s rise as a defense supplier in the region amid growing concerns over China’s assertiveness.

BrahMos, which is a supersonic cruise missile with an anti-ship capability, has garnered strong interest from buyers in the Indo-Pacific region as these countries with limited naval forces need to defend disputed territories in the South China Sea, experts told CNBC.

“BrahMos and the air-to-air missiles are the areas that are new in our collaboration [with Indonesia],” an Indian foreign ministry spokesperson said on Tuesday, adding that BrahMos was an important area of collaboration and commercial terms were yet be decided between the two sides.

Buyers are particularly interested in the anti-ship version of BrahMos, which has a range of 300 kilometers and an extremely high speed that makes it difficult to intercept, Siemon Wezeman, senior researcher in the Arms Transfers Programme at the Stockholm International Peace Research Institute, told CNBC.

It is “one of the largest and fastest available on the market just now,” he added. BrahMos Aerospace is a joint venture between India’s Defence Research and Development Organisation and Russia’s NPO Mashinostroyenia.

The only other missile similar to BrahMos is China’s YJ-12, Douglas Barrie, a senior fellow for military aerospace at the International Institute for Strategic Studies, told CNBC in an email.

Philippines was the first buyer of BrahMos in 2022. In May this year, ⁠India’s defense secretary said the country had signed a deal to sell the missile to Vietnam, Reuters reported. India’s Ministry of Defence and BrahMos Aerospace did not respond to CNBC’s requests for comment.

Both these deals are motivated by “the perception of China’s growing threat in the South China Sea,” Collin Koh, a senior fellow at the Institute of Defence and Strategic Studies, told CNBC.

While Indonesia does not see China as a primary security threat, it does have differences with Beijing over the “North Natuna Sea claim,” Koh added.

On Monday, the Chinese navy test-fired a ballistic missile into the Pacific, a move expected to push countries in the region to deepen defense ties with one another amid China’s growing military might.

That makes room for India to grow its defense exports in the region, experts said, as it is seen as a transactional provider, not aligned to any great power centers, and is not viewed as a security threat in the region.

The strengthening of defense partnerships among countries in the Indo-Pacific is part of the efforts to deal with the “China threat,” Farwa Aamer, director of South Asia initiatives at Asia Society Policy Institute, told CNBC.

She added that these countries also want to form defense ties that are “less reliant” on the U.S., all of which makes India a viable defense partner and the “BrahMos missile system lucrative.”

But while the BrahMos deals are helping India gather regional partners against China, experts said it hardly moves the needle for New Delhi’s ambition of becoming a significant defense exporter.

The sale of BrahMos is a “very strong visible proof that India has made it in the world of arms producers and exporters,” Wezeman from SIPRI said, but added India’s defense exports have had limited success when it comes to major contracts.

Orders for Indian fighter jet Tejas or frigates would be “worth a lot more than several BrahMos orders,” he added.

While exports have grown over the last 10 years, they were worth just 384 billion rupees ($4 billion) in the financial year ended March 2026. That’s a little over 1% of the total arms sales of $331 billion by the U.S., the world’s largest supplier of arms.

India is not among the world’s top 25 arms exporters, according to SIPRI’s 2021–2025 major arms transfer data, that includes China at fifth position and South Korea at ninth.

New Delhi, however, is the fifth largest military spender in the world and the second biggest importer of arms with more than 8% of the share, as per SIPRI’s 2026 yearbook.

The U.S. will engage in “technical talks” with Iran and remains committed to finding a solution to the conflict, despite the two countries trading airstrikes in recent days, MS Now reported Thursday, citing a U.S. official.

The official said President Donald Trump had made his position clear and characterized Iran’s attacks on commercial vessels as “acts of terrorism,” according to MS Now.

Those comments come after Trump at the NATO summit in Ankara, Turkey, said that the ceasefire with Iran was “over.”

The memorandum of understanding between the two countries is performance-based, and Iran’s actions constitute “failed performance at an unacceptable level,” the U.S. official told MS Now, adding that talks with Tehran will continue.

The ceasefire signed last month has come under serious strain in recent days with the U.S. and Iranian forces conducting strikes this week. “I don’t want to deal with them [Iran] anymore,” Trump said at the NATO summit. 

On his way back from the summit, Trump said that Iran had called to make a deal to cease the escalating hostilities in the Middle East. “They called a little while ago. They want to make a deal so badly. I just don’t know if they’re worthy of making a deal. I don’t know that they’re going to honor the deal. That’s the problem,” he said.

Iranian officials have accused the U.S. of not honoring the MOU, citing violation of “Iranian adjustments” in the Strait of Hormuz, “persistent threats of further strikes” and reinstating oil sanctions.

The U.S. military conducted renewed rounds of offensive strikes against Iran in retaliation for three commercial vessels transiting the Strait of Hormuz coming under attack. The U.S. Treasury Department subsequently withdrew a waiver that had allowed Iran to sell its oil.

Oil prices were marginally lower on Friday in Asia trading, with global benchmark Brent crude futures for September delivery easing to $76.3 per barrel while U.S. West Texas Intermediate crude futures at $71.87.

Nagi Hamiyeh, president of Temasek Global Investments, said crypto investment is “still off the table” for the company as it strives to move past a substantial loss in crypto exchange FTX.

“We don’t have directly any, any investment in crypto,” Hamiyeh told CNBC’s Sri Jegarajah on Wednesday, citing regulatory uncertainty in the sector. “I can’t forecast what happens in the future, and the role that crypto is going to play in the main economy, depending on the different regulations that might happen.”

For now, the company focuses on blockchain and its infrastructure, based on what the technology can do for the real economy.

Temasek’s investment in the now-bankrupt FTX cryptocurrency exchange led to a writedown of $275 million in 2022, drawing much local criticism. Lawrence Wong, who was Singapore’s deputy prime minister and finance minister then, called the loss “disappointing” and damaging for Singapore’s reputation.

Here are the other key takeaways from the interview:

Hamiyeh said he would bet on adoption of artificial intelligence and building commercial ecosystem around it, over pushing for frontier models, when asked what matters more for a long-term investor.

“Not every situation needs frontier models. It’s all about the applications, and it’s all about the companies that embrace AI and build a moat.”

His longest-term wager is on the physical implementation of AI: automation, robotics and industrial process optimization. Temasek aims to lift AI exposure from 6% of its portfolio in the latest fiscal year ended March to 15% by 2031.

The AI investment cycle is still early and will run for decades, Hamiyeh added, even as valuations in parts of the sector have run ahead of fundamentals. Temasek invests across the full AI value chain, including energy infrastructure and data centers, where long-term contracts with highly rated counterparties keep risk “very, very minimal,” he said.

Hamiyeh disclosed that Europe has drawn about 12 billion euros ($14 billion) of Temasek capital over the past two years, behind only the U.S.

Looking past the macro and political noise, he pointed to Europe’s “right to win” in world-leading luxury, consumer brands, energy transition, and family-owned industrials in the continent, where Temasek comes in with long-term patient capital.

On the Middle East, he said the region’s long-term transformation story remains intact, but the ramifications of the conflict have yet to fully play out.

“I still believe that the long-term view is there in terms of what the Middle East’s role is going to be in the new bifurcated world … however, we have to wait and see what are the ramifications of this conflict.”

Pressed on whether defense contractors belong in a portfolio that emphasizes sustainability and ethical investing, Hamiyeh said Temasek takes a practical approach and won’t completely rule the sector in or out.

The firm mainly looks at dual-use technologies that could be used in civilian settings, or in warfare. Biological and chemical weapons are categorically off-limits. Temasek’s only exposure to the space is ST Engineering.

“We look at every investment on a stand-alone basis,” said Hamiyeh, including corporate governance and their contribution to any real-world conflict.

— CNBC’s Isabella Lok contributed to the report.

NATO had a fractious summit in Turkey this week, with U.S. President Donald Trump threatening to sever trade with one ally and annex the territory of another. But the alliance’s boss was full of praise for the man he called “dear Donald.”

NATO Secretary-General Mark Rutte thanked Trump, describing his push to get NATO nations to increase defense spending as a “staggering” achievement and a “huge win” for the military alliance.

Rutte’s approach of using flattery to win over the president prompted some to question whether this had delivered any tangible benefits for the alliance.

Over the course of two days in Ankara, Trump threatened to sever trade ties with NATO member Spain over defense spending, said he was very disappointed with NATO’s response to the U.S. war with Iran and reignited his feud with Denmark, another member of the alliance, over Greenland.

But for Rutte, Trump had only praise, describing him as a “great leader” and the alliance’s “biggest asset.”

Sat beside one another during a bilateral meeting on Wednesday, Rutte lauded “dear Donald” for getting Canada and European nations to spend an additional $1.2 trillion on defense during his two terms in office, saying he called this the “Trump trillion.”

Rutte used this term during a visit to the Oval Office late last month, where he presented Trump with charts that detailed increased spending by NATO nations.

NATO’s chief also interjected on Wednesday when Trump sharply criticized former U.S. presidents for failing to get the rest of NATO to ramp up their defense spending commitments: “But you did what Eisenhower started trying to do. … And all the other presidents, none of them were successful. You were the first one. It’s your win.”

Trump replied: “That’s why I like him.”

The back-and-forth was a continuation of the approach Rutte, a seasoned diplomat known as a consensus builder during his nearly 14 years as Dutch prime minister, has taken since becoming NATO chief in late 2024.

Marion Messmer, program director for international security at Chatham House, told CNBC that her takeaway from the Ankara summit was that there is no one person who can manage Trump over the long term, and Europe is better off focusing on strengthening its own security instead.

“While Rutte manages to remain in Trump’s good books with his mix of flattery and submissiveness, other NATO leaders are increasingly irritated with what they perceive to be tasteless behaviour,” Messmer said via email.

In part, Messmer said that this is because Rutte hasn’t managed to transform his personal relationship with Trump into a benefit for NATO, as the U.S. president remains obviously dissatisfied with the military alliance.

“There is a concern that Rutte’s approach to managing Trump does not help the alliance as a whole and might send the wrong message to Russia, that European states feel weak without the US and are willing to bind the US to Europe no matter what,” she added.

In contrast to NATO’s Rutte, Denmark’s prime minister, Mette Frederiksen, struck a defiant tone following Trump’s latest push for U.S. control of Greenland, a self-governing Danish territory.

Asked by CNBC’s Steve Sedgwick whether Denmark would be prepared to defend Greenland militarily in the event of an attack, Frederiksen replied: “We are ready to defend every inch of NATO, including our own territory.”

A day earlier, Finnish President Alexander Stubb had sought to defuse any tensions regarding Trump’s Greenland comments. Speaking to CNBC, Stubb said: “Be more Arctic, be more cool. If it is about Arctic security, we have seven countries that are Arctic nations in the alliance.”

He added: “Finland has trained 1 million soldiers in Arctic conditions; we basically live in Arctic conditions. Let’s keep that in mind. Let’s, you know, continue the process that the Danes, the Americans and the Greenlanders have.”

Rutte and Trump’s “bromance” was a topic of conversation during last year’s NATO summit in the Netherlands, when the alliance made history by announcing a defense spending hike to 5% of individual members’ gross domestic products by 2035.

At that time, journalists questioned Rutte’s approach and particularly his description of the U.S. president as “Daddy,” something Rutte later described as “a question of taste.”

A year on in Ankara, a reporter asked NATO’s secretary-general about his “self-respect” during a news conference, who suggested he had failed to come to the defense of NATO nations threatened by Trump during the summit.

Rutte said that he was keen to “acknowledge when praise is due, and I think we should praise Donald Trump for the fact that NATO is so much stronger.” He added that Europe’s increased defense spending made the Continent “more relevant” to the U.S. as a strategic partner.

Not everyone was critical of Rutte’s approach to managing Trump at the summit, however.

“Mark Rutte is secretary-general of NATO, not secretary general of the European Union, not the president of the Commission, his only job is to keep [the] alliance running,” Latvian President Edgars Rinkēvičs told CNBC’s Steve Sedgwick on Wednesday.

“His only job is to [keep the] trans-Atlantic relationship intact. His only job is to do whatever it takes to have this alliance working, and he does [a] great job,” he added.

Ukraine’s drone attacks have been dominating headlines about its war with Russia — and upended NATO’s investment thesis.

Having boosted drone production and capabilities in four years of war, Ukraine has stepped up its attacks on Russian energy infrastructure and military assets, targeting high-profile oil refineries in major cities as part of a sustained push to cut off Russia’s energy revenues.

Defense experts and strategists have described its drone campaign as pivotal in helping to stall Russia’s military momentum, while also warning that Kyiv’s deep-strike successes have drastically raised the risk of escalation.

Earlier this week, Ukraine marked what appeared to be one of the country’s deepest attacks on Russian territory in the war so far.

Plumes of black smoke were seen billowing from a key oil refinery in the city of Omsk on Tuesday, prompting Ukrainian President Volodymyr Zelenskyy to declare that the country’s upgraded drone capabilities have put Siberia “within reach.” The Omsk facility is situated nearly 2,500 kilometers (1,553 miles) from Ukrainian territory and close to Russia’s border with Kazakhstan.

Ukraine’s advances on the battlefield spotlight how the rapid adoption of drones is reshaping modern warfare, as combat is becoming more autonomous, connected and data-driven.

Two things have changed to allow Ukraine to accelerate its long-range drone strikes deep within Russian territory, according to Bob Tollast, a research fellow in land warfare at the Royal United Services Institute, a London-based defense and security think tank.

A concerted effort from Ukrainian forces to boost production and improve inertial navigation, software and machine vision had all helped to improve resilience when satellite navigation is jammed, Tollast said.

Foreign support for Ukraine had also likely played a role, he added, noting that oil refineries and terminals were vast targets.

“We’ll see how Russia responds, they have had limited success with nets and drone interceptors of the kind Ukraine uses, and for some time have placed air defence systems on towers and recently even tall buildings,” Tollast told CNBC by email.

“But with Ukraine’s domestically made cruise missiles like Flamingo on the scene hitting industrial sites (including air defence production) the picture is pretty ugly for Moscow,” he continued.

“Ukraine’s counter refinery campaign is now a rain of blows, but it might be too early to say if Russia will suffer lasting damage because the sector has long had spare capacity,” Tollast said.

Russia has responded by also scaling its own drone production and integrating them more into its overall military.

Beyond the front line, Ukraine’s drone campaign also appears to have influenced NATO’s defense spending plans.

NATO Secretary-General Mark Rutte said Tuesday that drones have “fundamentally altered” the character of modern warfare and have become a “decisive factor” on the battlefield, citing the Russia-Ukraine war as one example.

Rutte’s comments came as he announced the launch of the alliance’s so-called NATO Drone Edge initiative, a plan in which allies are slated to invest more than $40 billion in counter-drone capabilities over the next five years.

“Together, we are building a drone-ready Alliance. We are leveraging the latest innovative technologies, investing in our transatlantic defence industries, and learning real-world lessons from the battlefield in Ukraine,” Rutte said.

Alongside cutting off Russian energy revenues, Ukraine’s drone attacks are designed to try to force Russian President Vladimir Putin to bring an end to the war.

Ukraine’s success on the battlefield has prompted a shift in how the country is viewed and its relationship to NATO and the European Union. Security analysts and world leaders alike have highlighted that Ukraine increasingly has something to offer allies and shouldn’t be seen as a mere beneficiary of military support and donations.

Ukraine is winning because they have become good at drones and counter-drone systems — technologies that other NATO allies aren’t very good at, Ulrike Franke, senior policy fellow at the European Council on Foreign Relations, told CNBC.

Ukraine is holding all the cards, she said, adding that it has “drones and counter-drone systems, and indeed data on how to fight the Russians.”

It comes as warfare is undergoing a major shift where expensive, more traditional tech is being challenged by a more agile, decentralized model, often spearheaded by startups and informed by what happened in Ukraine.

Ukraine became the global leader in drone warfare out of necessity, Morningstar analyst Loredana Muharremi said. “Facing a larger and better-equipped military, it could not compete symmetrically, forcing it to innovate rapidly with low-cost, commercially available drones adapted for military use.”

“Real innovation wasn’t the technology itself, but the procurement model,” she added in emailed comments to CNBC.

Throughout the 4½-year war, Ukraine has built a much faster innovation cycle than that of legacy defense companies, which often span years.

Cooperation between the military, domestic startups and private industry has allowed new technologies to be deployed in just weeks and drones to evolve continuously based on battlefield feedback, Muharremi said.

“The largest [financial] impact is expected to come through higher order intake and backlog over the next two to three years, with the more meaningful contribution to revenue and earnings from 2028 onward,” Muharremi said.

Finnish President Alexander Stubb said Ukraine’s Zelenskyy now “has the cards” to carry out long-range drone strikes, something the Trump administration said it did not approve of in October last year.

“There are two separate issues here. He has the cards for the long-range attacks, so the drones and the missiles that are hitting, say Russian oil refineries, and reducing their capacity to produce and export by 40%,” Stubb told CNBC on Tuesday.

“And he is actually turning the tide with the Russian population, which is now for the first time being against the war. So, this has to have an effect on Russia’s strategic thinking.”

Finland’s president warned, however, that “we shouldn’t be all smiles about it,” saying Ukraine needs air defense to bolster its war effort.

U.S. President Donald Trump held separate calls with Russia’s Putin and Ukraine’s Zelenskyy over the weekend and said Monday that a resolution to the conflict is “getting closer than people realize.”

South Korea’s stock benchmark, Kospi, has gone from being the world’s hottest equity market to entering bear territory within a few weeks, highlighting how investors have soured on artificial intelligence plays and underscoring concentration risks.

The Kospi fell more than 5% on Wednesday, which brought it 20% below its June 19 record high, according to LSEG data. It closed slightly higher on Thursday in choppy trading.

“South Korea’s recent drawdown has been driven by heightened AI skepticism on the part of global investors, coupled with extreme market concentration,” said Manishi Raychaudhuri, CEO of Emmer Capital. 

The speed of the reversal brings to light a central feature of this year’s rally: South Korea’s outsized dependence on the AI trade. Chipmakers Samsung Electronics and SK Hynix accounted for more than half of the Kospi’s weighting as of June, data provided by Emmer Capital showed. That extreme reliance has both lifted and sunk the index.

“The correction has been driven more by positioning than by a deterioration in fundamentals,” said Jung In Yun, founder of Fibonacci Asset Management Global. Korean equities had become “one of the most crowded AI trades globally after a very strong rally, so it did not take much to trigger profit taking,” he added.

Rising global uncertainty and concerns that earnings upgrades could moderate have also made investors more cautious, although he described the drop in Kospi as “a healthy reset rather than a fundamental change in the outlook.” 

Peter Kim, global investment strategist at KB Financial Group, argued that the move also reflects a broader shift in how modern markets behave.

“The gamification of finance has led to such gyrations driven less by fundamentals but by news flows and fads,” he said, adding that retail fund flows, leveraged exchange-traded funds and AI-driven concentration have made swings of 5% to 10% increasingly common. The Kospi volatility index has surged over 200% since the start of the year.

Kospi has been hammered lately despite strong earnings from the companies at the center of the sell-off. Samsung on Tuesday reported blockbuster profit, while memory pricing continues to strengthen. The chip giant’s shares, however, tanked on concerns about AI spending.

“The market is questioning the pace of earnings growth rather than the sustainability of AI demand itself,” Fibonacci’s Jung said. “This distinction is important because it suggests we are seeing a valuation adjustment rather than the end of the AI cycle.” 

Underscoring strong demand, Rolf Bulk, head of semiconductors and infrastructure at Futurum Group said that memory prices rose between 50% and 80% sequentially in the second quarter, with further increases expected later this year.

Fundamentals for memory makers remain intact, Bulk added, citing a multi-year supply shortage and long-term contracts with hyperscale customers. KB Financial Group’s Kim echoed that “fundamentals and visibility of earnings makes the current correction an opportunity for those who can withstand the short-term volatility.” 

The Kospi is still up more than 70% this year, having gained over 75% last year.

“While volatility may persist in the near term, I believe the medium-term outlook remains constructive,” said Fibonacci’s Jung. “Once global risk sentiment stabilizes, foreign investors are likely to revisit Korea given its central role in the global AI supply chain.”

The timing of any sustained recovery in South Korea’s stock market, however, remains difficult to predict and will depend in part on broader global market conditions, experts said.

The U.S. listing of SK Hynix on Friday could provide a near-term boost for memory stocks, according to Bulk. Constructive management commentary on the durability of the memory cycle through the second half of 2026 could help lift both chipmakers and the broader Kospi, he added.

“2Q26 earnings disclosures from SK Hynix and Samsung Electronics later this month can be a further positive driver: constructive commentary from both companies on the sustainability of the cycle in the second half of 2026 could support the stocks and the broader Korean market.”