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Last Friday, U.S. stocks experienced a V-shaped rebound, with all three major indices rising: the Dow Jones increased by 0.53%, the S&P 500 rose by 0.70%, and the Nasdaq gained 1.00%. However, this rally failed to mask the poor performance for the entire month of July: the S&P 500 ended the month virtually flat, recording its worst July performance since 2014; the Nasdaq fell 3.2% for the month, marking its worst July since 2004.
Trump cancels strikes on Iran, OPEC+ increases production, crude oil plunges 8%
Over the weekend, dramatic developments unfolded as Trump announced that, at the request of Saudi Arabia, the UAE, and Qatar, he has canceled the planned new military strike against Iran, stating that a framework already exists for the Hormuz Strait agreement, and nuclear disarmament talks will commence on Tuesday.
WTI crude oil plunged over 8% at Monday's open, briefly falling below $78 per barrel, while Brent crude also dropped more than 6%. Previously, crude prices had surged over 20% in July due to risks in the Strait of Hormuz, Houthi attacks, and damage to Russian refineries—the largest July increase in 30 years.
OPEC+ also added pressure on the supply side, with its latest statement confirming an increase of 188,000 barrels per day in September oil production quotas. Saudi Arabia, Russia, Iraq, Kuwait, Kazakhstan, Algeria, and Oman agreed to adjust output and reaffirmed their commitment to market stability, with the next meeting scheduled for September 6. Traders generally believe that Trump’s repeated pattern of “threaten-then-hold-off” has been played out before; the market’s current focus remains on whether the specifics of strait navigation and denuclearization can be genuinely implemented.
Gold experienced slight volatility in July, closing up 0.91%.
Since 2026, gold prices have declined approximately 30% from their January high due to rising expectations of interest rate hikes triggered by the U.S.-Israel-Iran conflict, capital diversion driven by the surge in technology stocks, and reductions in gold holdings by some central banks. In July, gold edged up 0.91% and is currently trading around $4,050 per ounce.
Analysis indicates that, in the short term, gold prices remain under pressure from the U.S. dollar index and real interest rates. However, as market expectations of Fed tightening are gradually absorbed and central bank gold purchasing provides support, gold prices are poised to enter a phase of consolidation and gradual recovery. GoldPredict technical analyst AG Thorson notes that gold is currently in a base-building phase; if it falls below $4,000 per ounce, it may seek further support, but holding above this level would be interpreted as a bullish consolidation.
In the medium to long term, the weakening credibility of the U.S. dollar and the strategic increase in gold reserves by central banks worldwide remain unchanged, reinforcing gold’s role as a reliable asset for risk hedging. The current market correction presents a favorable window for medium to long-term allocation, with gold prices expected to fluctuate between $3,800 and $4,500 per ounce this year.
The U.S. and Japan unusually intervened together to support the yen, while 30-year U.S. Treasury yields hit a 2007 high.
Trump and U.S. Treasury Secretary Bessent confirmed that the United States participated in last week’s foreign exchange intervention to boost the yen, stating they would not hesitate to continue coordinated actions with Japan. As a result, the USD/JPY pair sharply declined in early Monday trading, falling below the 156 level for the first time since May 6.
Analysis indicates that this intervention aims to prevent a yen collapse from triggering massive Japanese sales of U.S. Treasuries, which could raise U.S. financing costs. James Thorne, Chief Market Strategist at Wellington Altus, warned that if Japan’s Ministry of Finance is forced to sell U.S. Treasuries to defend the exchange rate, its shift to the seller side—as the world’s largest foreign holder of U.S. Treasuries—could force a repricing of long-term U.S. Treasury yields.
Driven by inflation concerns triggered by energy shocks, the 10-year U.S. Treasury yield closed at 4.74% in July, surging more than 30 basis points for the month—the largest July monthly increase since 2005. Meanwhile, the 30-year U.S. Treasury yield rose to around 5.281%, reaching its highest level since July 2007.
Last week, the market value of cloud giants increased by nearly $1.5 trillion, and Meta ended its eleven-day losing streak.
The deleveraging of tech and memory stocks persisted throughout July, with Goldman Sachs Prime Brokerage data showing that the three trading days from the previous Friday to last Tuesday saw the largest single-sided unwinding since November 2022, primarily targeting highly leveraged positions in semiconductors, memory, and AI infrastructure established between April and May.
Despite pressure from deleveraging, the cloud sector performed strongly. On Friday, tech heavyweights rebounded sharply, with Amazon Web Services' better-than-expected earnings igniting the cloud sector, Microsoft continuing its upward momentum, Google recovering losses from its earnings report, and Meta ending an eleven-day losing streak. Data shows that last week, the combined market value of the major cloud providers increased by nearly $1.5 trillion, with Microsoft adding approximately $616.5 billion, Amazon adding about $425.6 billion, and Google gaining nearly $445 billion. In contrast, the storage and some semiconductor sectors rose before pulling back, while Apple suffered a sharp decline due to supply constraints and a weak outlook.
Analysis suggests that the market has not abandoned AI, but is undergoing a structural reallocation. Capital is flowing out of over-crowded storage and hardware sectors and accelerating toward cloud giants and application-layer companies that can effectively convert capital expenditures into cash flow.
Specific project actions and stock price fluctuations:
Amazon surged 15.32%, marking its largest single-day gain since 2012. AWS revenue for the second quarter increased 36.7% year-over-year, the fastest growth rate in 18 quarters. CEO Andy Jassy stated that AWS is "very likely" to move toward $1 trillion in annual revenue. Previously, markets had worried that Amazon’s heavy AI capital expenditures lacked clear returns, but the earnings report showed AWS growth accelerating again and profitability exceeding expectations. The company also disclosed in regulatory filings that it has fulfilled its full $50 billion investment commitment to OpenAI.
Microsoft extended its historic single-day gain of 15.5% from Thursday with a further 3.02% rise on Friday. Prudent capital expenditures, solid free cash flow, and early evidence of monetization from Azure and Copilot have alleviated concerns about it being a bottomless pit of spending.
Google surged 6.88%, fully recovering its post-earnings decline, as DeepMind unveiled its next-generation robotics AI model, Gemini Robotics 2, achieving full-body control of humanoid robots for the first time.
Meta rose 3.28%, ending an 11-day losing streak. Following stronger-than-expected earnings reports from cloud giants, capital flowed back into AI platform companies, with Meta attracting buying interest as a key player in large models, AI-driven advertising, and computing power investment. However, Meta’s core challenge remains the timing and return on its capital expenditures.
Apple plunged 7.35%, losing over $358 billion in market value in a single day—the largest single-day drop since April 2025—yielding its title as the world's most valuable company to NVIDIA. CFO Parekh stated on the earnings call that memory shortages and component supply constraints will hinder iPhone, Mac, and iPad performance in Q4, with the Q4 revenue guidance of 9%-11% growth falling well below the market expectation of 12.1%.
Memory sector declines collectively: Micron falls 5.9% (down 28.7% for the month, but still up over 180% year-to-date), SanDisk drops 5.09% (down 46.57% for the month), SK Hynix ADR declines 3.54% (down over 7% for the week). Kioxia’s earnings missed expectations, with its ADR plunging 10.1%, adding further pressure. Western Digital rises 2.21% against the trend, while Seagate edges up 0.52%.
The optical communications sector rose broadly, with Coherent and Applied Optoelectronics up over 5%, and Astera Labs up over 3%.
Palantir closed up 0.65% on Friday, with post-market volatility rising ahead of its earnings report. Palantir will release its earnings after today’s U.S. market close, and this report will directly test the viability of “AI transitioning from compute to software revenue,” given Palantir’s status as one of the most highly anticipated stocks in AI applications.
SpaceX fell 3.41%, with Musk's net worth shrinking by over $600 billion from its June peak. SpaceX continues to face pressure as the market awaits its first earnings report since going public. The company will release its post-IPO earnings after market close on August 5 (Beijing Time), with focus on Starlink revenue and the commercialization progress of Starship. A greater risk looms on August 6: up to 911.5 million restricted shares are set to unlock, representing a potential value of nearly $100 billion based on the latest share price of $108.37.
Other giants: NVIDIA rose 2.93% after receiving public praise from Trump. Tesla increased 0.78%, following Musk dismissing rumors of spinning off its China operations to pave the way for a merger with SpaceX as "fake news" on X. Intel fell 1.02%, down 2.3% for the week and marking its sixth consecutive weekly decline. Markets are closely watching TSMC’s development of advanced AI chip packaging technology and its competitive pressure on Intel’s packaging strategy.
This week's focus:
August 3 (Monday)
Berkshire Hathaway earnings report: The market will focus on Buffett’s cash reserves, stock buybacks, insurance underwriting profits, performance of the railroad and energy businesses, and whether he will continue to reduce or increase holdings in core positions such as Apple, Bank of America, and Occidental Petroleum.
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 held concurrently, featuring industry giants such as NVIDIA, Google, Microsoft, Meta, and Samsung. AI pioneers Hinton, Li Fei-Fei, and Andrew Ng make their first joint appearance on stage, with Samsung expected to unveil its HBM4E roadmap.
Major earnings reports: Palantir, ON Semiconductor, Snap, Luckin Coffee, McDonald's, Caterpillar, Pfizer, Merck, Spotify, Hut 8, Cipher Mining, 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 are 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 serves as an indicator for AI network switches and cloud data center capital expenditures.
Major earnings reports: Circle, Eli Lilly, Novo Nordisk, Disney, SanDisk, Western Digital, AppLovin, IonQ, BeiGene, and more.
August 6 (Thursday)
SpaceX lock-up expiration: Up to 9.115 billion shares of SpaceX restricted stock are set to unlock, with an estimated potential value nearing $100 billion based on the latest share price—marking the largest liquidity stress test of the week. If selling pressure remains limited after the unlock, it will bolster market confidence in the ability to absorb high-valued tech assets; if selling pressure is concentrated and released, it could weigh on sentiment toward Nasdaq and Musk-linked assets.
05:00 PM: SanDisk and Western Digital post-earnings reports: These will directly impact sentiment in the storage sector. After recent consecutive corrections by Micron, SanDisk, and SK Hynix, the market will closely focus on enterprise SSDs, NAND prices, AI data center storage demand, inventory cycles, and second-half guidance.
Major earnings reports: Crypto mining companies CleanSpark, MARA, Datadog, D-Wave Quantum, ConocoPhillips, Unity, AAOI, MP Materials, Atlassian, Rigetti, MGM China, Zai Lab, and more.
August 7 (Friday)
20:30 U.S. July Non-Farm Payrolls, U.S. July Unemployment Rate: This is the most critical macroeconomic data of the week. Market expectations forecast approximately 90,000 new jobs in July, up from 57,000 in June, with the unemployment rate expected to rise from 4.2% to 4.3%. If non-farm payrolls exceed 100,000, markets may further bet on a September rate hike, pushing U.S. Treasury yields and the dollar higher while pressuring tech stocks. If employment misses expectations for the second consecutive month, expectations for rate hikes will cool, potentially leading to a rebound in growth stocks, gold, and long-term bonds.
China's July imports and exports, foreign exchange reserves: Export data will test the resilience of external demand, import data will reflect domestic demand and commodity demand, and foreign reserve data will influence expectations for the RMB exchange rate and sentiment toward cross-border capital flows.
Major earnings reports: Cambricon, China Rare Earth, Oklo, Vistra Energy, Under Armour, Liangwang Micro, and more.
August 9 (Sunday)
China's July CPI/PPI data has been released: it will test the trajectory of price recovery following the Politburo meeting, as markets use this to assess the pace of stabilization in domestic demand and industrial product prices.