Last updated: August 4, 2026, 5:30 PM ET
Market Reaction to Iran Deal Hopes
U.S. stocks to all-time highs as hopes for a diplomatic resolution to reopen the Strait of Hormuz intensified. The S&P 500 rose 1.8 percent, surpassing its previous peak from early June and marking a significant recovery from a recent tech stock sell-off. Treasury yields cooled amid a busy day of U.S. economic indicators and ahead of Friday’s employment report from the Bureau of Labor Statistics. Oil futures to a three-week low after Treasury Secretary Scott Bessent indicated that the U.S. might be close to an agreement with Iran to reopen the Strait of Hormuz. The price of oil dropped sharply on the prospect of progressing talks to reopen the Strait of Hormuz. U.S. stocks rallied, while oil slid on Middle East diplomacy hopes, as President Trump signaled a potential return to diplomacy with Iran. Treasuries rose on Tuesday as signs of progress toward a diplomatic resolution of the Iran war sent oil prices lower, curbing expectations for more than one Federal Reserve interest-rate hike Corporate Earnings and Performance
SpaceX brought in $7.8 billion in revenue in the second quarter, marking its first earnings report as a public company. Musk’s rocket company reported a 92% rise in revenue in its debut earnings report, outperforming analyst expectations, though its shares dropped as much as 8%. SpaceX's capital jumped nearly seven times from a year ago, with revenue also seeing an increase. Mattel posted a loss of $18.2 million, attributing it to higher advertising costs and selling, general, and administrative expenses, despite a climb in sales. Match Group's second-quarter profit was $170.5 million, but revenue fell 1%, weighed down by sluggish results for Tinder. Booking Holdings higher revenue driven by strong travel demand, having previously cut its full-year outlook in April due to concerns about the conflict in the Middle East impacting travel demand in some regions. Gilead Sciences swung to a loss due to research and development costs, though HIV-drug sales lifted revenue; however, the biopharmaceutical company lowered its full-year forecast for Veklury after sales of the Covid-19 treatment fell 81% in the second quarter. Amgen lifted its outlook on strong drug sales but decided to end the early development of a potential obesity treatment currently in a phase 1 study. Novo Nordisk, the maker of Wegovy, raised its guidance after a second-quarter boost, indicating that annual sales and operating profit should fall less than previously expected. Despite the positive outlook, Novo Nordisk's U.S. shares fell as sales of the Wegovy weight-loss pill did not meet Wall Street's obesity hype. Caterpillar said the artificial intelligence boom continues to drive demand for its engines and generators, while healthy construction spending is spurring sales of its dump trucks, bulldozers, and excavators. Inc.'s stock is facing an earnings test after losing nearly a quarter of its value, making its results a crucial indicator for investors regarding enthusiasm for the company's role in the AI boom.
Dealmaking and Financial Markets
Paramount struck an $111 billion deal to acquire Warner Bros., with a judge setting a trial for March concerning an antitrust lawsuit brought by state attorneys general. A dozen states have sued to block the $81 billion deal, and the trial is expected to last 12 court days. goods group P&G sealed a $3.8 billion deal for supplements company Thorne, expanding its health business in a sector that has boomed since the Covid pandemic. Cerberus Capital Management is looking to raise at least $4 billion for its latest supply-chain fund, which backs investments critical to national security. Baker Tilly dropped plans for a roughly $3 billion leveraged loan that was intended to refinance private credit debt and fund a dividend. Segro has accepted a £14 billion takeover offer from U.S. rival Prologis, adding to a spate of acquisitions of London-listed companies. UBS Financial Inc., a subsidiary of UBS Group AG, has agreed to pay $125 million in fines to settle allegations by the U.S. government that it willfully and repeatedly violated anti-money laundering regulations.
Economic Indicators and Trends
The U.S. trade deficit dipped in June as imports and exports both declined, retreating from a busy May, according to data from the Commerce Department. U.S. natural gas futures lost ground as temperature forecasts were revised lower while production and inventories remained high. U.S. natural futures made a modest advance with temperatures expected to heat up into next week, favoring power-sector demand. OPEC’s crude oil production recouped some of its wartime losses last month with gains in Kuwait, Saudi Arabia, and Iraq, though tracking the group's output was complicated by opaque shipping data. OPEC allies increased oil output for the sixth consecutive time, nearing the end of a cycle of production hikes as potentially difficult talks over future quotas loom. Russia's oil exports slipped as a lull in drone strikes boosted refining, allowing plants to process more crude and ship less abroad. Venezuela's oil plunged in July due to weaker demand from India, as a pause in the Iran war unlocked Middle Eastern barrels trapped in the Persian Gulf. Pakistan's inflation eased last month, though policymakers remain wary that higher energy costs could reignite price pressures. The flood of AI spending by big tech companies is “trickling down to the broader economy,” according to Wells Fargo & Co., which suggests this trend is poised to push up industrial stocks.
Automotive and Transportation Sector
The cost of diesel fuel, which powers industrial America, is set to remain elevated even as crude oil prices fall. Lucid's new boss predicts an industry "shakeout" and announced a $1.4 billion cost-cutting program, warning that the U.S. cannot "stay isolated" from Chinese EV competition. Lufthansa shares slid after a profit slump and more cautious guidance, with the airline group booking a steep drop in second-quarter profit and expecting a drag from volatile jet fuel prices. Toyota raised its annual earnings forecasts, citing a weaker yen and a smaller impact from the Iran war, and announced a buyback of more than $6 billion. The world's biggest carmaker expects to sell more than 5 million hybrid electric vehicles this year. Nissan posted its first quarterly profit in two years and kept its annual earnings forecasts unchanged, even as it lowered its vehicle sales projection.
Technology and AI Developments
SpaceX's revenue 92% in the second quarter, with its capital expenditures jumping nearly seven times from a year ago. The rocket company's debut earnings report showed it outperformed analyst expectations, though its shares dropped as much as 8%. AMD shares as the company narrowly beat revenue forecasts, with sales to data centers growing to 58% of revenue as the company has pivoted to serving the fastest-growing types of AI workloads. Caterpillar said the artificial intelligence boom continues to drive demand for its engines and generators. The flood of AI spending by big tech companies is "trickling down to the broader economy," according to Wells Fargo & Co., which says that's poised to push up industrial stocks. CXMT Corp. is one of the most polarizing stocks in Asia, with analyst price target ranges differing by as much as $1 trillion, highlighting the key arguments driving volatility in the memory-chip stock trade. Spotify's profits were hit by heavy spending as fears build over streaming growth, with its user growth forecasts missing estimates as it invests in AI tools to build its subscriber base.
Global Markets and Currency Movements
Coordinated intervention Japan to support its currency without selling off its U.S. debt holdings. The dollar reclaimed some ground against the yen after a joint Washington-Tokyo intervention to prop up the Japanese currency. The dollar extended its slide as a joint U.S.-Japan intervention to support the yen added to losses triggered by last week’s Federal Reserve meeting. The dollar strengthened against the yen as focus turns to Tokyo’s policy. Investors remain about the yen even after the joint U.S. and Japan intervention to support the currency, which has rallied since the move. The bid to support Japan’s currency shows the U.S. is ready to scupper trades that push against its interests.
Regulatory and Legal Developments
A dozen states sued to block the $81 billion Paramount-Warner Bros. merger deal, with the trial expected to last 12 court days. The EPA cannot block billions in climate grants, according to an appeals court, with the funds having been frozen since early in President Trump’s second term. Dr. Stephen a wound care doctor in Nevada, is accused of defrauding Medicare of $95 million by applying unneeded, expensive wound coverings to seniors, using the profits to purchase yachts. UBS Financial Services Inc. has agreed to pay $125 million in fines to settle allegations by the U.S. government that it willfully and repeatedly violated anti-money laundering regulations. Massachusetts is imposing "sectoral bargaining" on ride-share workers, who may find themselves governed by agreements they never signed up for. Aggressive tactics in the financial sector are prompting increased regulatory scrutiny. Creditors of failed UK mortgage provider MFS are suing Barclays after their accounts access was frozen, amid allegations of double pledging.
Energy Sector Dynamics
Oil futures fell sharply after Treasury Secretary Scott Bessent said the U.S. could be close to an agreement with Iran to reopen the Strait of Hormuz. Crude futures to a three-week low after Treasury Secretary Scott Bessent indicated that the U.S. might be close to an agreement with Iran to reopen the Strait of Hormuz, while Qatar reported progress in diplomatic efforts. The price of oil fell sharply on hopes that talks were progressing on reopening the Strait of Hormuz. U.S. stocks jumped after Bessent said a deal to reopen Hormuz is imminent, with the S&P 500 hitting a record high as Iranian and Omani negotiators agreed on a temporary shipping arrangement. OPEC’s crude production recouped some of its wartime losses last month with gains in Kuwait, Saudi Arabia, and Iraq, though tracking the group's output was complicated by opaque shipping data. Russia's oil slipped as a lull in drone strikes boosted refining, allowing plants to process more crude and ship less abroad. Venezuela's oil exports plunged in July due to weaker demand from India, as a pause in the Iran war unlocked Middle Eastern barrels trapped in the Persian Gulf. Clarkson Plc its full year performance to be “materially ahead of market expectations” after the shipbroker delivered a record first-half performance boosted by “exceptional volatility” caused by disruption in the Strait of Hormuz.
Real Estate and Infrastructure
JPMorgan Chase plans to invest $750 billion to boost U.S. housing supply and homeownership through 2035, aiming to finance one million affordable housing units and provide loans to 200,000 first-time home buyers. The Los Angeles Department of Water and Power plans to sell $400 million of water revenue bonds to help finance a sweeping infrastructure overhaul that has drawn fresh scrutiny since a pipe burst. A historic Pittsburgh private school is looking to borrow $30 million in the municipal bond market for campus upgrades as it fights for students. Citadel's new skyscraper project expects to secure a $3.3 billion construction loan.
Healthcare and Pharmaceuticals
Sciences swung to a loss on R&D costs, but HIV-drug sales lifted revenue; however, the company lowered its full-year forecast for Veklury after sales of the Covid-19 treatment fell 81% in the second quarter. Amgen lifted its outlook on strong drug sales but is halting the early development of a potential obesity treatment. Novo Nordisk, the maker of Wegovy, raised its guidance for the second time this year on a rosy outlook for its obesity and diabetes drugs, though its U.S. shares fell as sales of the Wegovy weight-loss pill did not meet Wall Street's hype. Moderna Inc. begun testing an experimental Ebola vaccine in people, marking the second candidate to enter clinical trials against the strain driving the deadliest Ebola outbreak in the Democratic Republic of Congo. The Medicaid program's spending on autism therapy has quintupled since 2021, far outstripping the growth in diagnoses and raising concerns about overprescribing and fraud. AstraZeneca is in talks with Bristol Myers Squibb for a potential $400 billion megadeal that could create the world’s fourth-largest drugmaker by market value.
Other Notable Developments
Elon Musk’s rocket company, SpaceX, reported a 92% rise in revenue in its debut earnings report, outperforming analyst expectations, though its shares dropped as much as 8%. EPA cannot block billions in climate grants, according to an appeals court, with the funds having been frozen since early in President Trump’s second term. A dozen states sued to block the $81 billion Paramount-Warner Bros. merger deal, with the trial expected to last 12 court days. Dr. Stephen a wound care doctor in Nevada, is accused of defrauding Medicare of $95 million by applying unneeded, expensive wound coverings to seniors, using the profits to purchase yachts. UBS Financial Services Inc. has agreed to pay $125 million in fines to settle allegations by the U.S. government that it willfully and repeatedly violated anti-money laundering regulations. Massachusetts is imposing "sectoral bargaining" on ride-share workers, who may find themselves governed by agreements they never signed up for. Aggressive tactics in the financial sector are prompting increased regulatory scrutiny. Creditors of failed UK mortgage provider MFS are suing Barclays after their accounts access was frozen, amid allegations of double pledging.