Public Markets 3 Days

Last updated: August 8, 2026, 11:32 PM ET

Equities

U.S. stocks rallied to fresh records on Friday after a surprise contraction in July payrolls dampened expectations for further rate hikes. The S&P 500 and Nasdaq Composite capped their best week since April, driven by a blockbuster earnings season that has eased concerns about AI spending and inflation. European stocks also rose for a fourth consecutive week, with strong corporate results and rising M&A chatter lifting benchmarks to fresh records. In Asia, South Korea’s volatility spike appeared to ease after a historic selloff flushed out leveraged positions, while Japan’s Topix faced its biggest overhaul, with over 600 companies set for removal under new eligibility rules.

The July jobs report, which showed the economy lost 23,000 jobs, sent a powerful signal through markets. Traders immediately scaled back rate-hike bets, fueling a broad rally. BlackRock’s Rick Rieder argued the contraction reflects a “productivity revolution” driven by AI, not economic weakness. Bank of America warned that investor bullishness had hit its most extreme level since 2021, advising clients to reduce exposure to risky assets. Airbnb shares soared alongside the broader market.

Fixed Income & Currencies

U.S. Treasury yields fell sharply after the weak payrolls data, with the 10-year note retreating as the odds of a September rate hike tumbled. The Treasury’s debate over auction cutbacks to temper yields sparked fresh discussion about the world’s biggest bond market. In Japan, the 15-year JGB yield presented a curious puzzle for analysts, while BBB-rated corporate bond sales surged as lower-rated borrowers sought covenant protection.

The dollar ended the week at its lowest level since May, as fading rate-hike expectations weighed on the greenback. The yen jumped 1% against the dollar after the jobs data, with markets eyeing potential further intervention. Japan confirmed a three-day intervention during the spring Golden Week holiday to prop up the currency. Hedge funds sharply reduced bearish bets on the yen after coordinated US-Japan efforts. The US selling euros to support the yen without warning European policymakers has added to geopolitical risks, according to BlackRock.

Energy & Commodities

Oil futures settled higher Friday but posted steep weekly losses, with WTI down 7.7% and Brent falling 5% as Middle East supply disruption concerns eased. Saudi crude shipments to the US plunged to zero in July for the first time since 1985. A refining crunch is keeping fuel prices elevated despite crude’s retreat, benefiting US refiners but creating a political problem for President Trump. A diesel squeeze fueled by Middle East and Ukraine wars is setting the stage for an even worse crunch ahead of winter.

US natural gas futures extended losses to seven consecutive weeks, weighed by strong production and soft LNG feedgas. China’s steel prices hit a near-decade low as the property downturn sapped demand. Indonesia’s attempt to cap coal prices at home has backfired, discouraging supply and causing power blackouts in one of the world’s biggest coal producers. Unionized workers at BHP’s Port Hedland iron ore export hub began rolling 24-hour strikes, escalating a pay dispute.

Global Markets & Macroeconomics

China’s inflation cooled more than expected in July, with factory-gate prices easing for the first time since the Iran war began, signaling that cost pressures from the oil shock are diminishing. The Philippine economy grew at its slowest pace since 2009, excluding the pandemic, as Middle East conflict stoked inflation. South Africa’s bond market has already upgraded the country to investment grade, ahead of rating agencies. Fitch expressed skepticism that Chile’s tax cuts will boost growth enough to offset revenue declines, emphasizing the need for spending reductions.

The UK housing market remains in “suspended animation,” with Lloyds data showing house prices unchanged in July. First-time buyers are getting older, with one in three starting a family before owning a home. UK Prime Minister Burnham faces warnings that his fiscal “flexibility” could destabilize financial markets. City bosses urged him to rule out changes to pension lump sums in the next Budget. The FCA is cracking down on financial crime after the MFS collapse, demanding more information from unregulated entities.

Corporate Finance & IPOs

The IPO market is heating up as private-equity firms, eager for exits, take companies public amid sluggish dealmaking. CICC has become the dominant financier in Beijing’s drive to compete in the AI tech race, leading a bonanza of Chinese AI listings. SpaceX shares staged a massive rally, nearing their $135 IPO price after a $327 billion swing in market value. Greg Abel finally put Berkshire Hathaway’s cash pile to work, ploughing a net $20 billion into stocks and ending a three-year selling streak.

Jane Street is in talks to shift its $11 billion in debt to investors including Pimco, in a private credit deal to fund further AI investments. Alphabet’s jumbo bond sale drew $115 billion of investor demand, signaling renewed appetite for AI-related debt. Whatnot, a live-shopping platform, nearly doubled its valuation to $20 billion in new funding. Situational Awareness bet $400 million on a stealth chip startup after its AI-battered hedge fund suffered major losses.

Sector Spotlight: Tech, Media & AI

Google’s AI leadership shake-up boosted Sergey Brin as Deep Mind’s Demis Hassabis stepped aside, consolidating control as the urgency to build AI products intensifies. Chinese AI start-up Moonshot restructured to win Beijing’s nod for a Hong Kong IPO. A landmark crypto bill stalled in the US Senate despite a $225 million lobbying push. The CFTC warned prediction markets against using American-style gambling odds.

DraftKings posted a swing to loss in Q2, hurt by promotion costs and competition from prediction markets. Warner Bros. Discovery reported a steep drop in sales, hurt by the loss of NBA rights and a weak film slate. TikTok laid off 250 employees, shuttering its Nashville office. Datadog warned that lower usage from a major AI customer could dent growth, despite posting Q2 gains.