Newsquawk US Market Wrap: Stocks mixed on tech weakness after earnings while oil slides ahead of weekend

• 
  SNAPSHOT: Equities mixed, Treasuries up, Crude down, Dollar flat, Gold up


• 
  REAR VIEW: Trump hasn't made a decision on major strikes on Iran, could make a deal or could hit them harder; Trump writes Xi and Putin said to him not to sell weapons to Iran; Pakistan reportedly exploring a path to resume US-Iran talks; Trump said to be losing patience over an Iran war with no clear end in sight; Iran rejects US ceasefire deal presented by Iraqi leader; Mixed US Flash S&P Global PMIs, Mfg misses, Svs beats; US announces new 10-12.5% tariffs on 60 countries; INTC earnings & guidance beat, capex raise sparks concern


• 
  COMING UP: Data: German IFO (Jul), US Durable Goods Orders (Jun), Atlanta Fed GDP (Q2). Supply: Australia, US. Earnings: LVMH, AstraZeneca.


• 
  WEEK IN FOCUS: Highlights include: FOMC, BoE, BoJ, US PCE, US GDP, and EZ CPI. Click here for the full report.


• 
  WEEKLY US EARNINGS ESTIMATES: Earnings plentiful with Mag-7 names the standouts. Click here for the full report.

MARKET WRAP

Stocks were mixed on Friday with the Nasdaq 100 underperforming. Weakness in technology stocks continued following earnings, while the S&P 500 was broadly flat. Intel (INTC) reversed its initial post-earnings gains as elevated CapEx weighed on the stock and broader semiconductor space. However, underlying breadth was considerably more constructive, with the Russell 2000 and Dow gaining, while the equal-weight S&P outperformed.

Crude prices pared some of the sharp gains seen throughout the week, with Brent falling sub USD 97.00/bbl after reaching USD 102/bbl on Thursday. The weakness appeared to reflect some position squaring ahead of the weekend rather than a meaningful improvement in the geopolitical backdrop. There were several reports of note but in late trade Trump stated he has not yet made up his mind on whether or not to conduct massive strikes on Iran, noting he always prefers to settle things diplomatically. He also noted that the US and Iran are talking, and he sees them as the most serious they have ever been.

Treasuries rose across the curve as the sharp pullback in crude helped unwind some of the pronounced selling seen earlier in the week. The belly outperformed, while moves were more modest at the long end.

Economic data were encouraging but had little lasting impact. The S&P Global Flash Composite PMI beat, driven by stronger services activity, although manufacturing unexpectedly eased. The report suggested GDP is growing at around a 2.0% annualised pace, but also warned of intensifying supply-chain delays and renewed price pressures.

In FX, moves were relatively contained, with the Dollar Index little changed. Antipodeans outperformed despite the mixed equity performance, with NZD leading the gains and AUD also firmer, while CAD lagged as crude prices tumbled. The Yen was broadly unchanged following Nikkei reports suggesting the BoJ is set to hold rates next week, despite some policymakers calling for further tightening following June's hike. Gold rose modestly despite the relatively steady Dollar, likely finding some support from lower Treasury yields.

Attention now turns to developments in the Middle East over the weekend before focus shifts to next week's FOMC decision and Chair Warsh's press conference. A hold remains the base case, although markets continue to price some risk of a hike following the recent surge in energy prices. The BoJ and June US PCE inflation report will also be key events next week.

US

S&P GLOBAL FLASH PMIs: The US Composite PMI rose to 53.6 in July (exp. 52.3, prev. 51.9), an eight-month high, as a sharp improvement in services offset softer manufacturing activity. The Services PMI increased to 53.6 (exp. 51.0, prev. 51.2), also an eight-month high, while the Manufacturing PMI edged down to 53.8 (exp. 54.5, prev. 53.9), with manufacturing output growth slowing to a four-month low. S&P Global said the survey is consistent with annualised GDP growth of around 2.0%, compared with the 1.2% pace signalled for Q2, while employment increased for the first time in three months. However, inflationary signals were concerning, with input cost inflation reaching a 14-month high and selling price inflation accelerating to its strongest since August 2022, while supplier delivery times deteriorated by the most since August 2022 amid disruption around the Strait of Hormuz. S&P Global cautioned that recent developments in the Middle East could exacerbate supply-chain and price pressures and increase downside risks to the near-term economic outlook, suggesting July's improvement may not mark the start of a sustained acceleration in growth.

NEW HOME SALES: US new home sales rose 1.6% in June to 628k, above the expected 609k. Supply was 9.3 months at the current sales rate, vs. May's 9.4 months worth. The median sales price of new houses sold was USD 398,300, -3.3% M/M. Oxford Economics note that new home sales were a touch stronger than they expected, and past months were revised higher, but the broader picture is still mostly one of stability rather than improvement. The hit to households’ real incomes and a renewed rise in mortgage rates will keep housing market activity soft.

FIXED INCOME

T-NOTE FUTURES (U6) SETTLED 7+ TICKS HIGHER AT 108-10+

T-notes gained across the curve, unwinding some of the week's weakness as oil prices retreated ahead of the weekend. At settlement, 2-year -1.8bps at 4.333%, 3-year -2.5bps at 4.367%, 5-year -2.7bps at 4.429%, 7-year -2.3bps at 4.550%, 10-year -1.8bps at 4.681%, 20-year -1.1bps at 5.190%, 30-year -0.1bps at 5.164%.

THE DAY: Treasury yields fell across the curve on Friday as oil prices retreated from recent peaks, with Brent falling back below USD 100/bbl. The pullback appeared to reflect some position squaring ahead of the weekend rather than any meaningful improvement in the geopolitical backdrop.

Reports around Thursday's close suggested the Iraqi President was travelling to Tehran with a US proposal, although Iran ultimately rejected it. The US also completed its 13th consecutive night of strikes against Iran, while the WSJ reported that President Trump is losing patience amid the lack of a clear path towards ending the conflict. Trump also held a Cabinet meeting on Friday to discuss whether to intensify the military campaign against Iran. On the more constructive side, reports suggested China is pushing Pakistan to explore a path towards renewed US-Iran talks. Overall, significant headline risk remains over the weekend, with attention on whether diplomatic efforts gain traction or the US moves towards further escalation.

Elsewhere, US economic data were encouraging. The S&P Global Flash Composite PMI rose to 53.6 from 51.9 (exp. 52.3), driven by the Services PMI rising to 53.6 from 51.2 (exp. 51.0). However, Manufacturing PMI eased to 53.8 from 53.9, below expectations for a rise to 54.5. S&P Global said the survey data are consistent with GDP growing at an annualised pace of around 2.0%, compared with the 1.2% pace signalled for Q2. The report also highlighted an intensification of supply-chain delays and renewed price pressures, although the data had little lasting impact on Treasuries.

Focus remains firmly on geopolitics, although attention will shift towards next week's FOMC decision. A hold remains the base case, but markets continue to price some risk of a rate hike following the recent surge in energy prices and associated increase in inflation concerns.

SUPPLY

Notes

• US to sell USD 69bln 2-year notes and USD 70bln 5-year notes on July 27; to sell USD 44bln 7-year notes on July 28; to sell USD 30bln 2yr FRN on July 29th; all to settle on July 31st..

Bills

• US to sell USD 92bln 13-week bills and USD 79bln 26-week bills on July 27; to sell USD 95bln 6-week bills on July 28; all to settle on July 30


• US sold 4-wk bills at high-rate 3.730%, B/C 2.79x; sold 8-wk bills at high-rate 3.795%, B/C 2.31x

STIRS / OPERATIONS

• Fed Pricing: 36.5bps (prev. Dec 38bps)


• EFFR at 3.63% (prev. 3.63%), volumes at USD 104bln (prev. USD 102bln) on July 23rd


• SOFR at 3.64% (prev. 3.62%), volumes at USD 2.971tln (prev. USD 3.026tln) on July 23rd


• NY Fed RRP op demand at 0.68bln (prev. 0.90bln) across 2 counterparties (prev. 6) on July 24th

CRUDE

WTI (U6) SETTLED USD 2.88 LOWER AT 89.31/BBL; BRENT (U6) SETTLED 3.91 LOWER AT 96.78/BBL

The crude complex saw losses on Friday, but appeared to be an unwinding of the weeks gains heading into the weekend, instead of any US/Iran de-escalation. Despite saying that, benchmarks did encounter a bout of pressure, and get sent to lows, on two updates: 1) Pakistan reportedly looking to resume US-Iran talks, in a push by China 2) Trump noting Xi and Putin have said they would not sell weapons to Iran. Despite that, the overall rhetoric remains aggressive and no indication of a peace agreement, as the NYT recentrly reported that Trump was meeting on Friday with top advisers and senior members of his cabinet to decide whether to intensify the military assault against Iran. Into the weekend, some geopolitical risk has been taken off the table as participants await updates on the situation, and how the state of play will be different upon the reopening.

EQUITIES

CLOSES: SPX +0.06% at 7,413, NDX -1.15% at 28,128, DJI +0.45% at 51,947, RUT -0.28% at 2,932.

SECTORS: Real Estate +2.39%, Materials +1.46%, Consumer Staples +0.94%, Financials +0.86%, Health +0.63%, Communication Services +0.43%, Industrials +0.35%, Energy +0.26%, Utilities +0.18%, Consumer Discretionary +0.15%, Technology -0.90%.

EUROPEAN CLOSES: Euro Stoxx 50 +1.23% at 6,287, Dax 40 +1.33% at 25,092, FTSE 100 +0.94% at 10,739, CAC 40 +0.88% at 8,372, FTSE MIB +0.95% at 51,802, IBEX 35 +1.65% at 19,586, PSI -0.40% at 9,215, SMI +0.92% at 14,346, AEX +0.31% at 1,090

STOCK SPECIFICS

• 
  Intel (INTC): Topped earnings expectations with strong guidance; saw fastest revenue growth in years.


• 
  American Express (AXP): Revenue and FY profit guidance missed.


• 
  Oracle (ORCL): Received a USD 3.31bln 5-year US Navy software contract; could be raised to USD 7bln.


• 
  SLB (SLB): Earnings beat.


• 
  Verizon Communications (VZ): Adjusted EPS and postpaid phone net additions beat; revenue missed.


• 
  Charter Communications (CHTR): Bigger-than-expected Q2 broadband customer decline.


• 
  SAP (SAP): Strong earnings and cloud growth.


• 
  Edwards Lifesciences (EW): Adjusted EPS and revenue topped expectations.


• 
  Tenet Healthcare (THC): Earnings beat; raised guidance.


• 
  Qualcomm (QCOM) said to inform customers that prices will go up by double-digit percentage; can no longer absorb increasing costs, according to reports.


• 
  Alphabet’s (GOOGL) Waymo reportedly exploring options to exit its Uber (UBER) partnership, with the relationship between the two tech groups souring amid an intense lobbying battle over the future of robotaxis, reports FT.

FX

The dollar was pressured on a couple of geopolitical updates that sent oil prices and US yields lower. Energy was already pressured, perhaps on profit-taking or on TACO anticipations, before extending on 1) Pakistan reportedly looking to resume US-Iran talks, in a push by China, and 2) Trump noting Xi and Putin have said they would not sell weapons to Iran. That said, further USD downside may be limited until more concrete efforts occur, with the Reuters report on Pakistan adding that sources cautioned that the obstacles to any talks with the US remain high. Meanwhile, Trump held a cabinet meeting today to discuss whether to conduct a massive strike on Iran.

US data saw mixed Flash S&P Global PMIs for July. Manufacturing unexpectedly fell to 53.8 (exp. 54.5) from 53.9 while Services came in above forecasts at 53.6 (exp 51.0, prev. 51.2), leaving the composite higher at 53.6 from 51.9; little reaction was seen.

Barclays' month-end rebalancing model indicated weak USD buying against most majors by month-end. The model suggested moderate bearish signals for CAD and GBP.

Antipodes were the top beneficiaries from the lower oil and higher gold price environment, with NZD paring some of its recent underperformance. Meanwhile, JPY was little changed as reports continue to lean on the BoJ keeping rates unchanged in July; in line inflation for June sparked a muted reaction in USD/JPY.

EUR was slightly firmer on the USD weakness. In the background, some support came via PMIs in the region. France, Germany, and the EZ all topped the composite gauge; however, the EZ survey period doesn't include the recent escalation that has seen Brent return above USD 100/bbl in recent sessions.

24 Jul 2026 - 21:04- EquitiesGeopolitical- Source: Newsquawk