Last updated: August 7, 2026, 2:32 AM ET

Public Markets Briefing

Global Equities: Record Highs and the AI Trade

The S&P 500 rose 1.8% to push past its previous peak from early June, capping a dramatic turnaround from the recent technology selloff. Wall Street's blistering run took a breather as traders digested recent stock gains and monitored hints of progress toward reviving the Strait of Hormuz shipping route. Booming corporate profits are driving the S&P 500 near another record, dampening concerns about the war, inflation and more. The market's gains have broadened as the AI trade falters, with traders piling into options betting on more gains in the benchmark index.

Futures climbed on Wednesday as the latest batch of earnings pointed to strong demand for artificial intelligence infrastructure. The dramatic turnaround in technology stocks has powered a $3.5 trillion increase in the Nasdaq 100's market capitalization in just four days, emboldening investors. Sentiment has turned around completely from last month's rout, though the AI trade is in the "kindness of strangers" phase, according to one chief investment officer. Wells Fargo says the AI boom is "trickling down to the broader economy," which is poised to push up industrial stocks.

European Markets Hit Records

European shares advanced for a fourth straight day as strong earnings boosted sentiment, with WPP leading gains in the media sector. European stock indexes rose at the open, extending a raft of record highs, with the Stoxx 600 up and industrial and retail stocks gaining. The European market is the only major region to have experienced a meaningful improvement in risk appetite in recent weeks, supported by fresh capital inflows and better-than-expected earnings. European stocks hit a record high, boosted by another strong set of earnings and a rally in mining shares.

Corporate earnings drove European stock indexes higher in early trade, with the Europe-wide Stoxx 600 index led by consumer-facing stocks and healthcare. European stocks traded steady near a record high as falls in HSBC and Novo Nordisk helped erase early gains. European indexes rose strongly after the opening bell, with defense and AI-related stocks gaining. European bonds are emerging as a safer choice for fund managers navigating an increasingly fraught global backdrop.

US Equities: Dow Records and Tech Volatility

The Dow industrials led US stocks mostly lower as oil prices rose amid uncertainty in the Middle East. Blue-chip average notches 24th high of the year while the Nasdaq slipped, and US stocks finished mixed as optimism about reopening the Strait of Hormuz was offset by more volatility in AI wagers. US stocks surged and oil fell sharply after Treasury Secretary Scott Bessent said the US could reach a deal with Iran to reopen the Strait of Hormuz "today or tomorrow."

US stocks fell in a jittery session amid doubts about the reopening of the Strait of Hormuz. The Dow industrials advanced while the Nasdaq Composite retreated after a morning rally. Oil prices gained amid talks to reopen the Strait of Hormuz, while the Dow broke its winning streak. The Nasdaq jumped 2.6% as oil prices declined, with SpaceX shares slipping in postmarket trading.

Asian Markets

Japanese stocks were lower in early trade as uncertainty over the Middle East conflict and energy costs persisted. Australia's stock benchmark climbed to a record on easing concerns over the US-Iran conflict and supportive signals in the domestic economy. Taiwan's stock market recorded a historic 9.7% drop as traders swallowed losses and bought more. Chinese solar stocks were whipsawed by domestic efforts to end below-cost sales and renewed tariff threats from the US.

China's rapid progress in low-cost artificial intelligence is strengthening the investment case for the country's internet giants after years in the shadow of chipmakers. China's latest initiative to rein in quantitative trading has reduced volatility but also sapped turnover. Shares of SK Hynix advanced, lifted by an overnight rally in US chipmakers and speculation that the Korean firm may unveil buybacks. The chip giant suffered its second short-lived share plunge in about a week, raising fresh questions about trading volatility on South Korea's alternative stock exchange.

Oil Markets and Middle East Tensions

Oil gained as prospects for a lasting agreement to reopen the Strait of Hormuz remained elusive, while bonds fell on inflation concerns. Oil extended gains after a report that Iran attacked "hostile targets" in the Strait of Hormuz, with Tehran seeking to bar US ships from the critical waterway. Oil rose in early Asian trade amid concerns over supply disruptions in the Middle East. Crude futures fell to a three-week low after Bessent said the US could be close to an agreement with Iran, 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. OPEC's crude oil production recouped some of its wartime losses last month with gains in Kuwait, Saudi Arabia and Iraq. US imports of Saudi Arabian oil dropped to zero in July, the first time that's happened for an entire month since 1985. Commercial crude oil stockpiles were up by 2.5 million barrels in the week ended July 31, against expectations of a 1.2 million barrel decline.

Refining Crunch and Fuel Prices

Lost capacity in Russia and the Gulf is a boon to US refiners but a political problem for Donald Trump, as fuel prices stay high even as crude retreats. US refineries are cashing in while consumers face rising diesel and petrol costs. America's fuel-makers are maxed out as they try to fill in the gaps of the global fuel supply crunch. The US shipped a record amount of distillate fuel overseas last week as domestic stockpiles fell again, signaling the global scramble for diesel is draining US supplies.

Fuel-makers enjoying skyrocketing profits will likely keep reaping standout margins through the next quarter and beyond, according to Phillips. The cost for fuel that powers industrial America is set to remain elevated even as crude falls. US natural gas futures edged up in rangebound trading ahead of the EIA's weekly storage report, while US natural gas futures lost ground as temperature forecasts were revised lower.

Currency Markets: Yen Intervention and Dollar

The dollar index traded in a tight range during a quiet Asian session, with focus shifting to US non-farm payrolls for July. The dollar finished its best day in two weeks as oil prices advanced amid fading optimism over easing tensions in the Middle East. The WSJ Dollar Index fell 0.2%, down six of the past seven trading days. The WSJ Dollar Index edged lower, down five of the past six trading days.

The yen is heading into the end of the week having surrendered nearly half of its intervention-driven gains, fueling speculation that authorities may step into the market again. Japan said it intervened in the currency market three times during the spring Golden Week holiday to prop up the yen. One of the most dramatic foreign exchange market interventions in decades aims to stabilize the slumping yen and stave off a larger crisis. Coordinated intervention allowed Japan to support its currency without selling off its US debt holdings.

US support for Japan's efforts to prop up the yen is unlikely to damage the dollar's status as the world's most dominant reserve currency, according to Goldman Sachs. The Japanese yen will strengthen about 6% against the dollar by year-end following coordinated currency intervention, according to Bank of America. Traders are rushing to hedge against swings in the US dollar ahead of Friday's payroll numbers as Federal Reserve Chairman Kevin Warsh leaves Wall Street guessing. The way it's being done should make us worry that the Federal Reserve is being roped into easing monetary conditions, according to the Wall Street Journal.

The South Korean won rose to the strongest level in almost 10 months as exporters converted their dollar earnings into the local currency. Higher interest rates are needed to address a growing yield gap with the US, according to the Wall Street Journal. The Colombian peso continues to be the best performing currency in emerging markets as investors shrug off the central bank's efforts to slow its rally. Most emerging-market currencies gained on Tuesday, rebounding from an earlier selloff amid optimism the US and Iran are nearing a deal.

Gold and Precious Metals

Gold was on track for its biggest gain in more than six months as dip-buyers supported prices above a key technical level. Gold jumped the most since February as prospects for a deal to reopen the Strait of Hormuz reduced expectations for Federal Reserve rate hikes. Gold futures finished higher as the latest JOLTS report showed the number of job openings little changed in June. Gold and silver prices dropped, snapping two- and three-day winning streaks, respectively.

Gold and silver prices also settled higher as copper prices rose for the third consecutive session and ended at fresh records. China's central bank is stockpiling more gold in Hong Kong, in a move likely to support the city's push to become a major bullion-trading hub. Ghana's central bank incurred losses of 22 billion cedis ($1.9 billion) in 2025 under a domestic gold purchase program.

Copper and Industrial Metals

Copper headed for a record close in London after strong gains fueled by signs of tighter supply across the global market. Copper futures on New York's Comex climbed to a record high as investors awaited a decision on US tariffs while tracking a push to reopen the Strait of Hormuz. Copper prices rose for the third consecutive trading session and ended at fresh records. Nickel declined to the lowest level since mid-July on renewed speculation that Indonesia will grant a higher ore-production quota to one of its largest mines.

Codelco is suspending work on a project designed to extend the life of its biggest copper mine in Chile after identifying a new source of seismic risk. Lumber prices have surged despite a housing slump, as steep duties on Canadian lumber, wildfires and sawmill closures have cut supply. The US is banning exports of scrap tungsten and "black mass" in a year-long ban on overseas sales of used critical minerals.

Bond Markets

Treasury yields rose ahead of Friday's US payrolls report as job-cut plans remained calm in July alongside low weekly jobless-claims figures. Treasury yields edged slightly lower ahead of Friday's employment report after weaker-than-expected private payrolls data. 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 Fed rate hike. Treasury yields cooled amid a busy day of US economic indicators and ahead of Friday's employment report.

Global yields are moving higher, supported by firmer oil prices as optimism over a reopening of the Strait of Hormuz fades. A sale of 30-year Japanese bonds drew firm demand, delivering some calm to a market buffeted by currency turmoil and worry over the government's debt load. The US Treasury retained its previous guidance for future debt issuance, signaling no change in note and bond auction sizes well into 2027. The US Treasury will need to increase the sizes of at least some of its fixed-rate borrowing programs next year, according to bond dealers.

Alphabet has received about $115 billion of orders for its latest jumbo bond sale, signaling renewed investor appetite for debt tied to the AI boom. Investors flocked to drugmaker AbbVie's $10 billion bond sale after signs of investor fatigue for new debt to fund AI efforts. Oracle and Stellantis are among a group of high-grade companies with debt that has recently traded close to junk levels, putting the bond market on watch for a new era of fallen angels. Barclays and HSBC say concern that the Federal Reserve is dragging its feet on inflation is giving investors another reason to buy inflation-protected bonds.

SpaceX: The Big Earnings Event

SpaceX shares rose on Thursday as investors digested the release of as many as 911.5 million shares worth about $100 billion from lock-up agreements. Shares in the Elon Musk-led rocket company fell after it spent $15.8 billion on AI projects in the second quarter with no plans to slow down. The rocket company's huge AI spending rattles investors while the Dow held onto gains. SpaceX's first earnings release following its record IPO is one of the most anticipated reports of the summer for traders on Wall Street.

Elon Musk's rocket company said its capital expenditures jumped nearly seven times from a year ago, even as revenue also rose. Shares slide even as group says quarterly revenues nearly doubled, with the company's AI spending plans unnerving investors. None of the company's most ambitious plans are possible without the success of its Starship rockets. What has happened to the finances of Elon Musk's rocket maker over the past three months is pretty irrelevant, argues the Financial Times.

Major Corporate Earnings

Allianz SE generated record second-quarter profit on better results in its insurance and asset management businesses, with Pimco seeing €32 billion in inflows. Europe's largest insurer by market capitalization booked a 10.6% rise in group operating profit. Allianz agreed to buy the asset management unit of Singapore's United Overseas Bank, marking the German insurer's second major deal in recent days.

WPP shares soared the most since its 1995 IPO after the advertising agency reported its turnaround efforts are gaining momentum. WPP said revenue less pass-through costs fell less sharply last quarter thanks to a recovery in its media-buying operations. Improved results follow the London-listed advertising group's root-and-branch review to streamline its businesses.

SoftBank reported a smaller-than-expected decline in quarterly net income, helped by a rally in its chip-stock holdings. The Japanese technology investment company has vowed to become a leading builder of AI data centers and a major investor in AI-powered robotics. First-quarter profits decline following records set in recent quarters, with an $8 billion gain on its Intel stake helping the Japanese group beat expectations.

HSBC reported a sharply higher quarterly profit with pretax profit increasing across its four key segments, and announced a $1 billion share buyback. HSBC will consider boosting its bonus pool for bankers if strong performance continues, according to CEO Georges Elhedery.

Glencore reported a steep jump in profits after a surge in the price of its most important commodities and its trading unit had one of its best ever periods. The miner has long complained that its London shares are undervalued, and now plans a secondary listing in Australia. Issuing depository receipts in Sydney will enable Australia's mining investors to buy and sell its shares in a local wrapper. Glencore also took a provision on its exposure to iron ore trader Radiant World and confirmed it has stopped doing any new business with the firm.

Equity Capital Markets and IPOs

Blockbuster share sales from AI-related companies in the Asia Pacific led to a record for equity capital markets activity last month, despite weakness in the region's stock market. India expanded the size of its share sale in state-run insurance giant LIC to raise $3.3 billion after the base offer was oversubscribed. India's plan to sell more shares in its insurance giant was no secret, but the government surprised the market by how much it raised and the pace of the deal. The UK's sluggish market for IPOs is leaving private equity and venture capital firms with fewer exit routes.

Attovia Therapeutics raised $289 million in a US initial public offering that priced at the top of its marketed range. Manipal Health Enterprises is set for a muted debut in Mumbai after its $960 million IPO, as gray market trading signals cooling investor sentiment. Unitree Robotics wants to raise about $900 million in an IPO that tests market interest in humanoid robots. OFB Tech, the operator of technology supply chain platform OfBusiness, is considering reviving plans for an IPO that could raise as much as $800 million.

Celestica is looking to raise $3 billion from selling new shares, joining a flurry of companies raising funds for data centers. The UK's top financial regulator is changing its rules around information sharing tied to IPOs, as London seeks to become a more attractive listing destination. Taiwanese conglomerate TCC Group Holdings is leaning toward listing its European operations in London. Mitsubishi UBE Cement is planning to go public as soon as December, five years after being formed through units of Japanese materials companies.

Deals and M&A

Segro accepted a £14bn takeover offer from US rival Prologis, adding to a spate of takeovers of London-listed companies. Bodycote received separate offers from CVC and Veritas valuing the FTSE 250 industrials group at about £1.8bn including debt. Nielsen Holdings agreed to buy DoubleVerify in a deal with an enterprise value of about $2.15 billion. Disney will sell its stake in A+E Global Media to Hearst for about $1.2 billion.

Kirin Holdings announced a deal to acquire Toronto-based Jamieson Wellness Inc., valuing the Canadian vitamins and supplements company at $1.4 billion. P&G sealed a $3.8bn deal for supplements company Thorne, expanding its health business. Ares Management is leading a $2.2 billion direct loan to help finance a healthcare services acquisition. Apollo Global Management is investing $1.02 billion in a joint venture with Starwood Real Estate Income Trust.

Fed Policy and Economic Data

The success of Kevin Warsh's chairmanship may rest on an issue that sits outside the traditional purview of monetary policy: the nation's ongoing fiscal deficits. The pushback against the Fed chair is unwarranted as he drives much-needed reform, according to the Financial Times. Investors aren't asking for rate guarantees — they simply want to know how the Fed will react to changing economic data, argues the Wall Street Journal. A rarely used Federal Reserve liquidity facility saw no activity last week, suggesting Japan didn't use the tool in its latest effort to support the yen.

Philippine economic growth dramatically slowed in the second quarter, defying expectations of a pickup, as the protracted Middle East conflict stokes inflation and drags down consumer spending. The earliest that the market is now anticipating a rate hike in India is December, after dovish comments from the central bank. US imports and exports both declined in June, retreating from a busy month in May, according to Commerce Department data.

Hedge Funds and Trading

Ken Griffin's hedge fund made billions last week after it bought the bulk of Situational Awareness's stock book. Citadel's flagship fund surged 6% after buying billions of dollars of AI stocks from Leopold Aschenbrenner's firm. A spate of well-known hedge funds reported steep losses in July as AI shares tumbled, most notably forcing the highly leveraged Situational Awareness to sell most of its stock portfolio at a deep discount. Whale Rock Capital Management's flagship hedge fund is one of the biggest losers in last month's AI selloff, with a 21.7% drop in July erasing about half of its gains for the year.

The losses that forced hedge fund Situational Awareness to sell stocks at deep discounts appear to be the result of highly concentrated positions in crowded trades, rather than a concerted effort by short sellers. Point72 and Citadel are among firms hit by audio phishing schemes in a wave of cyber attacks targeting big US hedge funds. Toms Capital Investment Management is bringing its push for Voya Financial to explore a sale directly to shareholders.

Private Credit and Lending

Jane Street is in talks to shift its $11bn of debt to investors including Pimco, in a private credit deal that would allow the trading firm to make further investments in AI. Profit at Blackstone's publicly traded private credit fund dropped 94% in the second quarter as the value of holdings declined, though loan performance steadied. Ares sought to complete a €1bn continuation fund but failed to get buy-in for pricing from investors, scaling back the private credit fund. Bridgepoint Group is exploring a deal to sell more than €1 billion of private credit stakes in a secondaries transaction.

BlackRock TCP Capital is moving $523 million in loans to a Pantheon-backed fund, involving nearly half of its debt investments. Baker Tilly has dropped plans for a roughly $3 billion leveraged loan that was intended to refinance private credit debt and fund a dividend. Blue Owl Capital sought to shore up confidence in two of its private credit funds, stressing that borrower fundamentals remained strong.

Commodities: Weather and Supply Risks

This year's El Niño weather pattern is set to be one of the strongest since 1950, raising the risk of food shortages and inflation across the world's most-traded commodities. Repeated heat waves and droughts have put Europe's power system on high alert, with shrinking hydro reserves threatening to drive electricity prices higher later in the year. Extreme temperatures and low river levels are curbing power supplies across Europe. The European Union is optimistic that winter LNG imports will help offset inventories at their lowest level for this time of year in almost two decades.

Global sugar traders are increasingly losing trust in what is widely considered the most important data piece in the market: the cane-crush indicators from the world's top exporter Brazil. Indian sugar producers are set to start crushing cane earlier than usual as the government seeks to rein in record prices ahead of the festival period. The European Union will carry out an audit in Brazil at the end of August that could allow the country's poultry exports to avoid a ban due to take effect on Sept. 3.

Notable Stock Movers

Fujifilm Holdings shares fell by the most on record after the Japanese company reported weaker-than-projected quarterly results. Shares in United Wholesale Mortgage fell by a record 49% after the country's biggest mortgage lender announced a net loss of $452 million and suspended its dividend for the first time. DraftKings reported second-quarter sales and earnings that missed analysts' expectations as the sportsbetting industry confronts a new challenge from prediction-market players. The online sports betting company posted a loss of $67.6 million for the second quarter, compared with a profit of $157.9 million a year earlier.

Celsius Holdings shares tumbled after the energy drink maker's second-quarter revenue missed expectations as competition hurt sales of its namesake brand. Six Flags Entertainment shares slumped after the company's second-quarter revenue and attendance fell short of estimates. Duolingo shares fell as much as 12% after the company's conservative revenue outlook for the current quarter overshadowed user growth. The New York Times Company's stock plunged 13% as subscriber growth slowed, despite total revenue climbing 11% to $762.5 million in the second quarter.

Market Structure and Trading

For much of the first week of trading under India's new auction system to set closing stock prices, traders were convinced that one of the most consequential market structure reforms in years was faltering. India's first weekly derivatives expiry under the new closing auction system did little to ease concerns after the benchmark NSE Nifty 50 Index again moved sharply during the auction. The first weekly expiry for India's BSE Sensex Index under a new closing-price methodology passed largely without disruption, easing concerns after the mechanism's turbulent debut. A key options trade particularly popular in India to bet on volatility on the day equity derivatives expire showed an unusual pattern, highlighting a potential trading opportunity.

Japan's Topix stock index is poised for its biggest overhaul, with more than 600 companies likely to be gradually removed under new eligibility rules. A growing number of investors from the US to South Korea are using leveraged exchange-traded funds for long-term investing, a far cry from the day trading they were designed for. The technology trade may be poised to become even more dependent on retail investors and more volatile after a rough July, according to JPMorgan.