Public Markets 3 Days

Last updated: August 4, 2026, 2:30 PM ET

Middle East Tensions and Oil Prices

U.S. stock rose as oil prices fell, reflecting a shift towards diplomacy with Iran. President Trump signaled the cancellation of planned strikes on Iran and indicated that peace talks would resume. Hopes for a deal to reopen the Strait of Hormuz led to a sharp decline in oil prices. Progress in talks with Iran to reopen the Strait of Hormuz was reported, with officials suggesting an agreement might be imminent. Officials confirmed that draft language of a deal was being circulated. The U.S. Treasury secretary suggested that an agreement with Iran could be reached by Wednesday. Crude oil futures extended their decline on these hopes of a U.S.-Iran deal. Treasury yields also fell as oil prices decreased due to the optimism surrounding a Hormuz deal. The lack of progress on U.S.-Iran talks, however, lifted oil prices back above $86 a barrel, putting emerging market stocks and currencies under pressure. Thousands of civilian workers remain stranded on ships at risk of attack by Iran, with some sailors held by the Iranian navy for over three months.

Global Markets and Corporate Performance

The S&P 500 hit a record high as investors shook off worries, with stocks trading near record levels despite concerns about disappearing cash flows at some Big Tech companies. U.S. stocks jumped as Secretary Bessent stated a deal to reopen the Strait of Hormuz was imminent. Booming corporate profits are driving the S&P 500 near another record, dampening concerns about war, inflation, and other issues. Morgan Stanley's Michael Wilson suggested that momentum-style equity investing is poised to rebound as sectors with strong earnings replace chip stocks in leading market gains. Novo Nordisk raised its annual forecast for the second time this year, citing higher expectations for its obesity and diabetes drug sales. The Danish drugmaker anticipates annual sales and operating profit to fall less than previously expected following a boost in the second quarter. Pfizer's quarterly results surpassed expectations, driven by rising sales of cancer and heart drugs, which helped offset steep declines in its Covid-19 products. Wayfair experienced a mixed second quarter, with its U.S. business growing while international sales declined. Caterpillar reported that the artificial intelligence boom continues to drive demand for its engines and generators, while healthy construction spending spurs sales of its heavy machinery. Cummins raised its outlook for the year after reporting higher profit and sales in the second quarter, boosted by accelerating orders for standby power for data centers and improving North American markets.

Financial Transactions and Dealmaking

Jefferies Financial Group Inc. has been informed that some invoices supporting its financing to iron ore trader Sapphire Minmetals Corp. are not genuine. Baker Tilly has dropped plans for a roughly $3 billion leveraged loan intended to refinance private credit debt and fund a dividend. The team working on Citadel's new Manhattan skyscraper anticipates securing a $3.3 billion construction loan for the project. Revolut co-founder Nik Storonsky is being sued over a $400 million superyacht deal, allegedly attempting to avoid paying approximately $20 million in commission. The consumer-goods giant Procter & Gamble has agreed to purchase supplements maker Thorne for $3.8 billion to enhance its presence in the beauty and wellness industry. AbbVie Inc. is seeking to raise at least $8 billion from an investment-grade bond offering to fund a portion of its acquisition of Apogee Therapeutics Inc. Bridgepoint Group is exploring a deal to sell more than €1 billion ($1.15 of private credit stakes in a secondaries transaction. India is expanding its share sale in state-run insurance giant LIC to raise $3.3 billion, following strong demand and oversubscription of the base offer, which bolsters public finances amid challenges from higher oil prices. some ground against the yen after joint Washington-Tokyo intervention to support the Japanese currency. Bessent's yen intervention signals a new era of U.S. "currency activism," indicating the U.S. is prepared to counter trades that go against its interests. Japan's historic intervention with the U.S. is shifting market focus to whether the yen can strengthen beyond 155 per dollar, a level strategists consider the key test for the rally's endurance. The U.S. Treasury will likely need to increase the sizes of some fixed-rate borrowing programs next year but is unlikely to signal this shift immediately, according to bond dealers. Treasuries rose as falling oil prices eased pressure on the Federal Reserve, curbing expectations for more than one interest-rate hike. Options traders are cutting long-term bearish bets on the South African rand, with the cost of hedging against rand declines over the next 12 months falling to the lowest level this year. The Colombian peso is on track for its largest drop in three months after the central bank unexpectedly paused rate hikes and announced a program to build dollar reserves, signaling a shift in currency policy.

Regulatory and Legal Developments

New Jersey is suing Amazon, alleging that its Delivery Service Partner program illegally suppresses wages and violates federal and state antitrust laws through unlawful "monopsony" practices. UBS has been fined $125 million for alleged anti-money laundering failures. The U.S. attorney's office has dismissed several prosecutions related to the Reflecting Pool case after revelations that a botched renovation, not vandalism, caused the pool's problems. A judge blocked a New York law barring ICE agents from wearing masks, though a ban on formal cooperation with local police officers will proceed. The House Ethics Committee has called for the censure of Representative Chuck Edwards for likely violating sexual harassment rules by showering two female staffers with gifts.