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On the first trading day of August, Wall Street opened strongly. As U.S. President Trump signaled progress in U.S.-Iran negotiations, markets reassumed that the Strait of Hormuz might resume normal shipping, causing the oil risk premium to decline rapidly, while U.S. stocks and bonds rose in tandem.
All three major U.S. stock indices rose, with the Dow Jones Industrial Average closing up 1.32% to a record high; the Nasdaq Composite surged 2.13%; and the S&P 500 gained 1.48%, nearing its historical peak.
Iran denies negotiations with the U.S., Trump pressures oil giants to lower oil prices
On Monday, Trump said that negotiations between the U.S. and Iran have begun, with the first phase involving the opening of the Strait of Hormuz and the second phase focusing on denuclearization, and he hinted that the strait "could reopen as early as tomorrow."
Iranian officials immediately retracted the claim, denying direct negotiations with the U.S., stating that Iran is only discussing safe navigation arrangements in the Strait of Hormuz with Oman, and warning that it will never allow the U.S. to establish non-Iranian shipping routes. Despite conflicting statements from both sides, expectations of negotiations caused WTI crude to plummet 7.42% yesterday, with Brent crude falling approximately 6% in tandem.
Trump also pressured U.S. oil companies, naming ExxonMobil and Chevron, demanding they "lower consumer oil prices now." Data shows that ExxonMobil and Chevron combined earned $29 billion in profits during the second quarter, equivalent to an average daily profit of approximately $318 million—a more than threefold increase year-over-year. Trump expressed strong dissatisfaction, accusing oil companies of profiting excessively from supply shortages.
The energy sector was the only one of the S&P 500’s 11 sectors to close lower, as investors began to reduce the energy risk premium previously built up due to the Middle East conflict.
Precious metals are trading with a slightly bullish bias, U.S. Treasury yields are declining, and yen intervention has become the market's focus.
Gold held key support at $4,000 and closed slightly higher at the end of the session. The Bank of Korea plans to purchase domestically refined gold bars for the first time in 13 years and has already acquired a small amount of gold ETFs in the second quarter, with official buying providing support for gold’s medium-term allocation rationale. The Bank of Korea stated that heightened geopolitical risks have increased the necessity of diversifying foreign exchange reserves; as of July, its gold holdings remained at 104.4 metric tons, with foreign exchange reserves totaling $427.36 billion at the end of June.
In the interest rate market, the 10-year U.S. Treasury yield declined by approximately 5 basis points to around 4.68% due to falling oil prices, while the 2-year U.S. Treasury yield closed at approximately 4.246%, with longer-dated yields outperforming shorter-dated ones. ING interest rate strategist Michiel Tukker explicitly stated that oil prices remain the biggest uncertainty and will largely determine whether interest rates rise or fall this week. B. Riley Wealth Chief Market Strategist Art Hogan also summarized the core monitoring logic on the trading desk: every morning, traders first check two indicators—international oil prices and the 10-year U.S. Treasury yield; if both decline, the market typically remains stable.
The U.S. Dollar Index initially declined before stabilizing, briefly falling below 100. The dollar did not weaken significantly, partly due to strong U.S. manufacturing data, which reduced market expectations for rapid monetary easing. Although the U.S. ISM Manufacturing Index rose sharply to 55.6 in July, the highest level since May 2022, market expectations for a Fed rate hike in September remained at 66.5%.
Additionally, fluctuations in the yen exchange rate have drawn attention, with estimates suggesting that the Bank of Japan deployed approximately $87 billion (about ¥11 trillion) in intervention efforts between July 30 and 31. Market concerns arose that Japan’s sale of U.S. Treasuries to fund such intervention could push yields higher. In response, U.S. Treasury Secretary Bessent reassured markets that the Federal Reserve’s liquidity mechanism allows countries to obtain U.S. dollars by pledging Treasuries as collateral, eliminating the need for direct sales—thereby easing short-term pressure on the U.S. Treasury market.
The Seven Giants launch a counterattack, as Amazon enters the $3 trillion club.
U.S. stocks rallied strongly last night, with the AI and cloud computing narratives making a full comeback. The Big Tech Seven Index surged 3.6%, posting its best single-day gain since March 31. Amazon rose over 4%, with its market capitalization surpassing $3 trillion for the first time; NVIDIA climbed nearly 3%, bringing its total market cap back above $5 trillion; Meta jumped over 6%, while Microsoft and Google each rose nearly 5%.
Capital flows indicate that the market is shifting from defense to offense, with strong performances from cloud service providers like CoreWeave and Oracle, as well as AI software stocks such as Palantir and Snowflake. Morgan Stanley’s latest report notes that the recent pullback in the AI sector is primarily driven by technical factors, while the high ROI of enterprise AI adoption and sustained growth in computing power demand continue to support the long-term thesis for AI infrastructure. Additionally, sectors including optical communications, quantum computing, and space stocks have also shown active performance.
Specific project actions and stock price fluctuations:
Amazon rose 4.58%: Driven by stronger-than-expected Q2 AWS cloud performance, Amazon’s market capitalization历史性突破了3万亿美元大关. Wall Street has become extremely optimistic about its 2026 full-year capital expenditure outlook, believing the trend of insufficient AI computing supply will persist. Chairman Bezos also took the opportunity to announce a $4.1 billion share sale plan. Related cloud computing stocks surged across the board: CoreWeave jumped 19%, NEBIUS rose over 11%, and Oracle climbed more than 9%.
Meta rose over 6%, leading the Magnificent Seven: although heavy investments in AI infrastructure temporarily pressurize profits, the market remains more optimistic about its long-term positioning. Zuckerberg reiterated that Meta’s capital expenditure ceiling could reach up to $145 billion by 2026, signaling continued heavy investment in AI infrastructure.
Google rose nearly 5%, surpassing Apple in market capitalization to become the world’s second-largest company: its off-balance-sheet guarantees surged sixfold over nine months to $43.8 billion, using “financial backing” to secure TPU orders and accelerate data center expansion.
Microsoft rose 4.93%, accumulating approximately a 25% gain over the past three trading days: Following its earnings report, institutional analysts continued to raise their price targets. UBS raised its target price from $480 to $525, while China Merchants Bank International increased its target from $616 to $634, both maintaining a “Buy” rating. The consensus average target price among institutions is approximately $565.
NVIDIA rose nearly 3% amid renewed trading activity in AI infrastructure, regaining a $5 trillion market capitalization: Goldman Sachs chief strategist Ben Snider stated that investors need not overreact to recent volatility in AI and momentum assets, as the current pullback resembles a concentration squeeze and consolidation, with strong corporate earnings remaining the core driver of the U.S. stock market bull run. Goldman Sachs highlighted Alphabet, Amazon, Microsoft, NVIDIA, and Broadcom as key contributors to earnings.
SpaceX rose 5.68%, rallying in after-hours trading ahead of its earnings report: SpaceX will release its first quarterly earnings since going public on August 4 after market close. Since its mid-June listing, the stock had traded below its $135 IPO price for several consecutive weeks, falling more than 50% from its intraday high and erasing over $500 billion in market value. In response to a user on X, Musk stated that he believes the current price will be viewed in hindsight as an “excellent buying opportunity.” This comment significantly boosted retail investor sentiment, prompting early capital positioning ahead of the earnings release. Related space sector stocks also rose: Rocket Lab and Boeing both gained over 8% (following FAA certification of the 737 MAX 7), AST SpaceMobile climbed nearly 8%, and Viasat advanced nearly 6%.
Palantir rose over 14% in after-hours trading following stronger-than-expected second-quarter results and full-year guidance. Full-year revenue guidance was raised to $8.15–8.16 billion, significantly exceeding prior expectations. U.S. commercial revenue surged 149% year-over-year, further validating the AI adoption narrative. AI application software stocks continued to gain strength: Reddit rose nearly 10%, Snowflake climbed nearly 5%, and ServiceNow, AppLovin, and Datadog all advanced over 2%.
Snap after-hours trading rose over 7%: Although second-quarter revenue exceeded expectations due to benefits from World Cup advertising, the CEO emphasized that AR glasses represent the greatest long-term opportunity, and investors responded enthusiastically to this long-term narrative.
The optical communications sector has also been ignited by demand from AI data centers: Applied Optoelectronics rose nearly 17%, AXT Inc. rose nearly 14%, Lumentum and Coherent each rose over 9%, Corning rose over 6%, and Credo rose over 5%.
Quantum computing concepts rally: D-Wave Quantum rises over 10%, Rigetti Computing climbs over 7%, IonQ advances nearly 7%, while IBM and Honeywell each gain over 1%.
Storage sector rebounds: Micron Technology initially fell nearly 6% during trading but recovered to close higher; SanDisk rose 6.03%, driven by recovery in NAND market conditions and expectations of increased data center demand. Seagate declined 2.93%, but BNP Paribas significantly raised its price target from $1,050 to $1,275, maintaining a "Outperform" rating, citing that massive data generated by AI applications is boosting demand for nearline hard drives, and the company’s increased long-term contract commitments for 2028–2029 will help stabilize future revenue and pricing.
Most cryptocurrency-related concepts rose, with SoFi Technologies up over 10%, IREN up over 8%, Hut 8 and Robinhood up over 4%, and Strategy up nearly 2%. Morgan Stanley believes that valuations for related assets such as TeraWulf, Cipher Mining, Hut 8, Riot Platforms, Applied Digital, and Galaxy Digital are currently low, presenting potential for revaluation. Meanwhile, GameStop fell over 12% (after the company announced a private placement of convertible notes worth $1.4 billion), and Circle declined nearly 4%.
Next, pay attention to:
August 4 (Tuesday)
August 4–6: AI4 2026 and the FMS Flash Memory Summit kick off—North America’s premier AI industry summit and the global Flash Memory Summit take place concurrently, with industry giants such as NVIDIA, Google, Microsoft, Meta, and Samsung in attendance. AI pioneers Hinton, Li Feifei, and Andrew Ng make their first joint appearance on stage, and Samsung is expected to unveil its HBM4E roadmap.
Major earnings reports: Hut 8, Cipher Mining, Caterpillar, Pfizer, Merck, Spotify, HSBC Holdings, Techtronic Industries, and more.
August 5 (Wednesday)
04:30 SpaceX's first earnings report since its IPO: The market is closely watching Starlink revenue, Starship commercialization progress, free cash flow, and the pace of capital expenditures. As SpaceX is set to undergo a large-scale lock-up expiration in two days, if the earnings report fails to present a compelling growth narrative, the stock may face dual pressures from liquidity and valuation; however, strong guidance on Starlink revenue and commercial launches could help alleviate selling pressure ahead of the lock-up expiry.
05:00 AM Earnings Reports: AMD, Astera Labs, Arista Networks — AMD’s earnings serve as a key test for the second tier of AI chips. The market is focused on MI-series AI chip shipments, data center revenue, gross margin, and guidance for the second half of the year; Astera Labs is a key player in AI server interconnect and data center connectivity chips, while Arista is a bellwether for AI network switches and cloud data center capital expenditures.
The White House plans to convene a meeting with AI companies to review the AI regulatory framework: OpenAI, Google, Anthropic, Meta, and others will participate in the discussions. If the framework favors voluntary safety testing and light regulation, the valuation discounts for leading AI companies may decrease; if the oversight mechanism becomes stricter, smaller model companies and application-layer firms may face higher compliance costs.