STRAIGHT FROM THE TRADING FLOOR
by Michael P. Reinking, CFA - Sr. Market Strategist
Published on 7/7/26 (a/o 1:30 pm)
DOW 52,935 (-121), S&P 500 7,519 (-18), Russell 2000 2,995 (-14), NYSE FANG+ 17,391 (+103), ICE Brent Crude $74.29/barrel (+$2.30), Gold $4,158/oz (-$9), Bitcoin ~64.1k (-359)
  • Violent rotations continue and the US World Cup run ends
  • Geopolitics back in the fray
  • Oil and yields moving higher
  • High bar heading into earnings season
  • Check out some of the recent ICE Data/Content:
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  • Episode 543: America250 Chair Rosie Rios on Unity, Storytelling, and America's 250 Years
  • ETF Central: Milliman Principal & Managing Director Adam Schenck
  • NYSE Research Insights: Behind the Record Volumes: A Hidden Opportunity
  • ICE Mortgage Monitor: June 2026 - Home Equity Withdrawals Reach Highest First-Quarter Level Since 2021
  • Market Storylines
MAC Desk Commentary:
After stumbling into the long weekend, Tech stocks- in particular the semis/hardware names- bounced on Monday, pushing the S&P 500 up 0.8%. Unfortunately, speaking of stumbling, the US Men’s National team lost last night to Belgium, ending their World Cup run. We turn our sports attention back to the Yankees who are also in the midst of a pretty big stumble themselves. Comm Services, Info Tech and Consumer Discretionary led the markets higher. Meanwhile, Thursday’s leadership- Healthcare, Utilities, Staples and Real Estate- lagged. The Russell 2000 rose 0.5% while the equal weight was flat. Treasuries were flat-to-lower while Bitcoin rose about 2% to ~$64K despite Strategy disclosing it sold >$200ml. 

Major indices opened modestly lower, but the momentum unwind picked up steam. That unwind left not only semis/memory and other AI adjacent stocks in its wake, but other themes have moved sharply lower as well including rare-earths, robotics, space and quantum. Once again, we’re not seeing a mass exodus from equities but there is what feels like a mechanical rotation with mega-caps and defensives once again leading to the upside. Looking at the movement of speculative capital - as AI unwinds, we’re seeing some positive action in software and crypto two areas of the market that have been left for dead. As we head to print the S&P 500 is only down ~0.25% as the mega-cap tech names have bounced despite the ICE Semi index trading off >4% (unwind of the follow the money trade).  The equal-weight is hovering around unchanged with adv:dec in the index ~1.5:1.
Outside of the tech news flow geopolitics are back in the fray.  Oil prices are moving higher after shots were fired at ships in the Strait, which seems to be bleeding into Treasury markets as well.  The NATO summit also began today with President Trump bringing control of Greenland back into the conversation and threatening to remove troops from Europe. Meanwhile the Ukraine/Russia conflict continues to percolate in the background with the former stepping up drone attacks. Natural gas prices in Europe are up ~7%.

It was a reasonably quiet day of economic data. The weekly ADP employment change data came in lower than expected and included a downward revision to last week’s data.  The report still showed job gains but comes on the back of the recent soft monthly payroll data. After the open the NY Fed released its Survey of Consumer Expectations which showed 1 and 3yr inflation expectations up 0.2% to 3.7% and 3.3% hitting the highest levels since 2023 and 2022, respectively. This happened despite gas price expectations falling. 5yr inflation expectations were unchanged at 3%. Labor market expectations improved slightly, as did perceptions of financial situation for households. Circling back to inflation for a moment, yesterday after the close on social media President Trump said Walmart would be lowering prices “by a lot” including beef prices by ~15%.  The company followed up the President’s post with a press release announcing lower prices on thousands of products. This fits well with the President's affordability problem ahead of midterm elections.
Treasury yields aren't putting much stock in that having a lasting effect and are up a couple of basis points across the curve with some steepening. The 2-10 spread has now unwound the post-Fed meeting move. The 3yr auction at 1:00 priced through the when issued market with strong indirect bids.  The US Dollar Index modestly higher despite the yen strengthening after a better than feared 30Y JGB auction in Japan. Bloomberg noted speculative yen shorts are at their highest level since 2007.
  • US 2yr +3bps to 4.15%, 5yr +4bps to 4.25%, 10yr +5bps to 4.52%, 30yr +5bps to 5.04%
  • USD index: +$0.11 to $100.72
Tech weakness left Asian markets mostly lower. The Nikkei fell 2% overnight as weakness in South Korea (KOSPI -5%) post-Samsung earnings trumped Monday’s US tech strength. Memory maker Kioxia fell 11%. Household spending came in stronger than expected. In China Shanghai fell over 1% and Hong Kong dropped 0.5%. DeepSeek is reportedly developing its own AI chips, which initially weighed on Nvidia, but the stocks bounced after testing its 200d ma. Over in Europe, the major indexes closed mostly lower. Consumer products and autos are leading while Tech, industrial producers and miners lag. Germany’s Industrial Production was better than expected and rose from last month but the DAX is down >1% as Siemens, Siemens Energy and Infineon fall 3-7%.  
Oil prices are up ~3% with ICE Brent testing its 200d ma. As the USD moved higher metals have given up the early rally attempt. Hong Kong is expanding its gold trading operations, including the launch of its new clearing system. This comes as China increased its gold reserves for the 20th straight month, with June’s addition the largest increase over that period. Ag is trading higher, following up on strong gains yesterday though coffee is pulling back sharply . Bitcoin and Ether are trading a little lower but are showing some signs of life with Bitcoin ~64k and Ethereum attempting to break above its 50d ma ~1,800.
In other corporate news:

  • Vertex is keeping the Biotech M&A train rolling along, announcing it would acquire Crinetics for ~$10B.
  • Major US banks are in early talks with Fiserv about buying the company’s payment network, according to media reports.  However, there are significant concerns about political blowback that could lead to suitors stepping away.
  • SemiAnalysis is out with a report that says AI debt financing could exceed $7 trillion by 2029 (Amazon is raising $25B today). That would put it behind only mortgages as the second largest asset-backed securities (ABS) sector. 
Earnings:
After-Market: EPAC, PENG, SAR
Pre-Market (Wed.): HELE
After-Market (Wed.): AZZ, LEVI, PSMT

Economic Data:
US:
  • LMI Logistics Managers Index: 71.1 vs prior 69.5
  • ADP Weely Employment Change: 21.0K/week vs prior 24.25K (revised from 30.75k)
  • Trade Balance: $-77.6B vs $-78.5B cons, prior $-54.6B
  • 4:30pm API Crude inventories
Global:
  • Japan Household Spending (May) m.m / y.y: 3.7% / -0.4% vs 1.4% / -2.5% cons, prior 1.6% / -0.5%
  • Japan Real Wages: 1.4% vs 2.0% prior
  • China FX reserves: $3.416T vs $3.44T cons, prior $3.442T
  • Germany Industrial Production: 0.9% vs 0.2% cons, prior 0.2%

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