Market performance was varied today, with the S&P 500 Index ($SPX) (SPY) edging lower by 0.09%, the Dow Jones Industrial Average ($DOWI) (DIA) gaining 0.10%, and the Nasdaq 100 Index ($IUXX) (QQQ) declining 0.29%. Looking ahead, September E-mini S&P futures (ESU26) and E-mini Nasdaq futures (NQU26) are trading down by 0.07% and 0.22%, respectively.
Equity markets are seeing modest volatility, primarily driven by weakness in the software and cybersecurity sectors. Investors are looking toward Alphabet’s upcoming earnings report for clues regarding the profitability of its significant investments in artificial intelligence, particularly as the company prepares to potentially double its capital expenditure to $190 billion this year. Conversely, energy stocks are seeing gains as WTI crude oil rallied to a six-week high.
The surge in WTI crude oil (CLU26) prices is contributing to higher bond yields, which has exerted pressure on equity markets. Crude oil climbed over 2% to a six-week peak as geopolitical tensions escalated; recent developments in the U.S. and Iran have dampened hopes for peace negotiations, raising concerns over potential disruptions to global energy supplies. Consequently, the 10-year T-note yield rose to a two-month high of 4.66%.
Geopolitical tensions remain a focal point as the U.S. conducted its 11th consecutive day of strikes against targets in Iran, aimed at protecting commercial shipping through the Strait of Hormuz. Iran responded with strikes on U.S. installations in Bahrain, Kuwait, and Jordan. President Trump stated that serious negotiations remain a prerequisite for any future diplomatic meetings with Iran.
Simultaneously, the Joint Maritime Information Center reported that Houthi rebels, backed by Iran, are preparing missile and drone strikes in the Red Sea. The group has threatened a blockade against shipping linked to Saudi Arabia, potentially impacting oil exports from the Yanbu hub. President Trump indicated that the U.S. would take action to prevent a Red Sea blockade.
In housing, MBA mortgage applications increased 1.9% for the week ending July 17. While purchase mortgage applications rose by 5.5%, refinancing requests fell by 2.4%. The average 30-year fixed mortgage rate climbed 4 basis points to an 11-month high of 6.69%.
The broader outlook for Q2 earnings remains a bright spot for the markets. Bloomberg Intelligence forecasts that Q2 earnings may grow by 23%, following a robust 30% increase in Q1. Artificial intelligence infrastructure is expected to be a primary driver, potentially accounting for nearly 60% of the S&P 500’s earnings-per-share growth this quarter. Currently, 91% of S&P 500 companies that have reported Q2 results have exceeded analyst expectations.
Regarding monetary policy, markets are currently pricing in a 34% probability of a 25 basis point interest rate hike at the upcoming July 28-29 FOMC meeting.
International markets showed mixed results today: the Euro Stoxx 50 rose 0.55% to a two-week high, China’s Shanghai Composite edged up 0.17%, and Japan’s Nikkei-225 declined 0.18%.
Interest Rates
The 10-year T-note yield rose 2.6 basis points to 4.655%, even as September 10-year T-notes (ZNU6) saw a slight decline. Rising oil prices are fueling inflation concerns, which is viewed as a hawkish signal for Federal Reserve policy. The 10-year breakeven inflation rate reached a one-week high of 2.288%. Additionally, supply pressures are expected as the Treasury prepares to auction $13 billion in 20-year T-bonds.
European yields are also trending upward. The 10-year German bund yield rose to 3.192%, and the 10-year UK gilt yield climbed to a two-month high of 5.065%.
In the UK, June CPI fell to 2.6% year-over-year, down from 3.8% in May, while core CPI remained steady at 2.6%. Meanwhile, swaps indicate a 5% probability of a 25 basis point rate hike by the ECB at its next meeting on Thursday.
US Stock Movers
The software sector is experiencing significant downward pressure. Notable losers include Atlassian Corp (TEAM) and Workday (WDAY), both down over 5%. ServiceNow (NOW) and Palentir Technologies (PLTR) have both dropped more than 4%, while Salesforce (CRM) is down over 3%. Other notable declines include Datadog (DDOG) and Autodesk (ADSK), both down over 3%, and Microsoft (MSFT) and Adobe (ADBE), both down more than 2%.
Cybersecurity stocks are also sliding, with Zscaler (ZS) down over 3%, and CrowdStrike (CRWD), Palo Alto Networks (PANW), Okta (OKTA), and Fortinet (FTNT) all down more than 2%. Cloudflare (NET) has dropped over 1%.
In contrast, energy stocks are rising alongside WTI crude oil. Devon Energy (DVN), Diamondback Energy (FANG), Occidental Petroleum (OXY), and SLB Ltd (SLB) are all up more than 2%. Additionally, APA Corp (APA), Baker Hughes (BKR), Chevron (CVX), and ConocoPhillips (COP) are up over 1%.
In other news, Pegasystems (PEGA) fell over 13% following weaker-than-expected quarterly earnings. Reddit (RDDT) declined more than 9% amid reports regarding content access for AI training. GE Vernova (GEV) dropped over 6% after missing EBITDA estimates, and TE Connectivity Plc (TEL) fell over 6% following its announcement to acquire Astrodyne TDI. Chubb Ltd (CB) dropped over 3% after reporting lower-than-expected net premiums, and Northern Trust Corp (NTRS) fell over 3% due to higher non-interest expenses. Cal-Maine Foods (CALM) fell over 2% after missing sales estimates.
Leading the gainers in the S&P 500 is Super Micro Computer (SMCI), which jumped over 24% following reports of a record order backlog. Westinghouse Air Brake Technologies (WAB) rose over 10% after beating sales estimates and raising its full-year guidance. CoreWeave (CRWV) climbed over 5% following an upgrade from Truist Securities. AT&T (T) gained over 3% on strong wireless subscriber growth, and DigitalOcean Holdings (DOCN) rose over 3% following a Stifel upgrade. Oklo (OKLO) and X-Energy (XE) saw gains of 2% and 1%, respectively, following reports of their involvement in US AI power plant development. Teledyne Technologies (TDY) rose over 2% after beating earnings estimates and raising its full-year guidance.
Earnings Reports (7/22/2026)
Alphabet Inc (GOOGL), AT&T Inc (T), AvalonBay Communities Inc (AVB), CME Group Inc (CME), Crown Castle Inc (CCI), CSX Corp (CSX), EastGroup Properties Inc (EGP), Equity LifeStyle Properties Inc (ELS), Equity Residential (EQR), First American Financial Corp (FAF), First Industrial Realty Trust (FR), GE Vernova Inc (GEV), Globe Life Inc (GL), Graco Inc (GGG), International Business Machine (IBM), Iridium Communications Inc (IRDM), Kinder Morgan Inc (KMI), Knight-Swift Transportation Ho (KNX), Las Vegas Sands Corp (LVS), Medpace Holdings Inc (MEDP), Molina Healthcare Inc (MOH), Moody’s Corp (MCO), Northern Trust Corp (NTRS), Otis Worldwide Corp (OTIS), Packaging Corp of America (PKG), Philip Morris International Inc (PM), Pinnacle Financial Partners In (PNFP), PulteGroup Inc (PHJM), QuantumScape Corp (QS), Raymond James Financial Inc (RJF), Reliance Inc (RS), RenaissanceRe Holdings Ltd (RNR), RLI Corp (RLI), Rollins Inc (ROL), RPM International Inc (RPM), SEI Investments Co (SEIC), ServiceNow Inc (NOW), Sonoco Products Co (SON), Southwest Airlines Co (LUV), Stifel Financial Corp (SF), TE Connectivity PLC (TEL), Teledyne Technologies Inc (TDY), Tesla Inc (TSLA), Texas Instruments Inc (TXN), Travel + Leisure Co (TNL), Westinghouse Air Brake Technol (WAB), WEX Inc (WEX), Wyndham Hotels & Resorts Inc (WH).
