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Last updated: July 22, 2026, 2:30 AM ET

Middle East Tensions Drive Oil Prices Higher, Impacting Global Markets

Oil futures for a third straight session as U.S. and Iran continued strikes, with President Trump signaling a willingness to escalate. Goldman Sachs warned that oil could if the Strait of Hormuz remains disrupted. Equinor reported a significant jump in second-quarter adjusted operating income, over 75%, driven by higher energy prices stemming from the Middle East conflict. Treasury yields traded little changed as investors weighed rising oil prices against hopes for an end to U.S.-Iran hostilities. Kazakhstan announced it would stop piping oil to a key Russian terminal after Ukrainian tanker attacks, potentially removing another 1 million barrels a day from the market. Saudi crude flow from the Red Sea hit a record before Houthi warnings, while the Philippines and other developing Asian countries are working to build strategic petroleum reserves to buffer against future shocks from rising fuel costs.

Corporate Earnings and Dealmaking Show Mixed Fortunes

Santander posted a 36% drop in net profit compared to the prior quarter, attributing the decline to restructuring charges from recent deals down 36%. Rare Earths giant Lynas Rare Earths Ltd. saw its shares fall to a five-month low after missing revenue expectations. In the U.S., Alaska Air swung to a second-quarter loss of $76 million due to rising fuel costs but expects a recovery in the third quarter. Super Micro Computer raised its fourth-quarter gross margin forecast to 15%-17%, more than double its previous guidance expects gross margins of 15% to 17%. Hasbro lifted its outlook as consumers continue to purchase trading cards and toys, with its "Magic: The Gathering" game outperforming.

Technology Sector Grapples with AI and Regulatory Scrutiny

Concerns over the impact of artificial intelligence on software companies led to downgrades for Adobe Inc. and Salesforce Inc. prompted more. Google faces scrutiny from publishers like Reddit and Politico, who are re-evaluating their partnerships as AI tools increasingly supplant traditional search methods. French AI startup Mistral is reportedly in fundraising talks with Samsung, with the South Korean giant potentially investing as much as €1 billion at a €20 billion valuation. Meta's use of AI to ban accounts on Facebook and Instagram resulted in users reporting mistaken deletions, requiring further AI intervention for resolution. The U.S. administration is considering imposing steep tariffs on generic drugs, a move intended to push companies towards manufacturing medications domestically.

Economic Indicators and Currency Movements Under Pressure

The Japanese yen slid past 163 per dollar for the first time in almost 40 years, further testing the resolve of Japanese authorities to intervene. The Philippine peso dropped to match its record low as higher oil prices put pressure on the currency. The Indian rupee has fallen about 2% from its June high, with bets on its recovery vanishing as soaring crude prices blunt inflows. The Singapore dollar consolidated, likely remaining subdued ahead of the Monetary Authority of Singapore’s monetary-policy decision next week. Thailand's bonds have outperformed their emerging Asian peers over the past month, with analysts predicting further gains due to favorable supply dynamics and slowing inflation.

Private Capital and Market Dynamics Undergoing Shifts

Private capital is missing out as an IPO and deal boom lifts Wall Street banks, marking a dramatic shift from recent years when the sector was perceived as more resilient to financial market changes. Private equity assets stuck in "zombie funds" have reached a record high, with fund managers struggling to sell remaining assets. Oaktree Capital Management sees a $200 billion "distressed moment" approaching as interest rates remain high and debt comes due over the next few years. Short sellers are ramping up bets against Hello Fresh SE's debut bond, which experienced a rocky start just three weeks after its issuance. Hong Kong home prices are forecast to rebound significantly over the next two years, driven by mainland Chinese demand, limited supply, and robust rental growth.