To The Moon

For the week ending 24 Jul 2026, there were only a few economic reports to reference.

They hardly made a dent in the US market because there were stronger factors dampening, enabling US market to finish the week lower.

Index Performance.

US market - 3 composite indexes past week performances

• DJIA. For the week, it fell by -0.4% to close at 51,947.25, despite a late rebound on Fri, 24 Jul 2026.

• S&P 500. Slipped by -1.03% over the 5 days to 7,411.98, marking its 2nd consecutive weekly decline.

• Nasdaq. Down by -2.90% for the week, closing at 24,975.82 due to heavy selling in mega-cap tech and the "Magnificent 7".

Key Catalysts.

Broadly, there were 4 key factors that caused the wild swings in US market, especially the tech index.

• Geopolitical & Energy Shocks: Brent crude surged past $100 a barrel mid-week following Middle East escalations before pulling back toward $96.78 on reports of potential diplomatic talks.

• AI & Tech Pressures: Was it pure coincidence or conspiracy that investors (simultaneously) doubts grew over AI capex and returns following high-profile corporate updates. Across the board, all stocks were down ‘badly’ as reflected in Nasdaq more than -2.0% fall.

• Treasury Yields: The 10-year Treasury yield hovered around 4.68% as inflation concerns resurfaced ahead of the upcoming FOMC meeting schedued for July 28–29. (see below)

• New Round of Tariffs: With the temporary tariff expired on Friday, the Trump administration has “at the same time” implemented the Broad Section 301 forced-labor tariffs of either +10% or +12.5% across 60 economies, impacting risk sentiment, all over again.

Although latest report has it that US has halted (?) further attacks on Iran (haven’t we heard that before) and Iran confirming that negotiations are on-going, yet again. (see below)

The question on everyone’s mind will be - “will it lasts ?”

Already, the conflict has spread to the Bab el-Mandeb Strait, a waterway connecting Red Sea to the Gulf of Aden, that carries roughly 5% of global maritime trade. (see below)

Will Trump’s navy be able to mitigate risks as it spreads (like wild fire) across the Gulf region ?

With so many shocks factors hitting at once, US market story almost tells itself, saving me time when I put the reports together.

In a selfish way, it is ‘good’ (for me) as I spend less time to research, compose and share the post.

On a bigger scheme of things, I think most reports and even quarterly earnings may not matter; not when geopolitics have taken centrestage hostage - paving for what might transpire in the weeks to come.

I will not dwell on the prospect of the US bomber presence in the Middle East, except that if put to use, the history of the Gulf region and maybe of the world, may forever be changed - good or bad.

Reports out last week:

• Mon, 20 Jul 2026 - US leading economic indicators.

• Thu, 23 Jul 2026 - US jobless claims.

• Thu, 24 Jul 2026 - US S&P Flash Services PMI.

• Thu, 24 Jul 2026 - US S&P Flash Manufacturing PMI.

US Leading Economic Indicator (LEI)

For June 2026, the Conference Board’s LEI for US declined by -0.2% to 99.1 (2016=100), vs economists’ estimates of -0.1% vs May 2026’s gain of +0.1%.

Latest reading has partially reversed gains registered in April & May 2026.

Optimistically speaking, the LEI is down by only -0.3% over H1 2026, a much smaller rate of decline when compared to H2 2025’s -1.1% contraction.

The largest positive contribution from the yield spread, followed by marginal positive input from the remaining financial components, were not enough to offset weak consumer expectations and a drop in building permits across most of its categories.

Despite the recent decline, the LEI’s 6- & 12-month growth rates, while negative, were stable.

Consumer spending is weakening, but strong business investment AI-related is expected to support economic activity while inflation continues to improve.

The Conference Board has raised its GDP growth forecast (for 2026) to 1.9% YoY from 1.8%.

In short, the June 2026 LEI report is considered weak when all the above are taken into considerations.

Jobless Claims.

US Department of Labour’s 23 Jul 2026, jobless claims reports underscores a highly resilient domestic US labour market, characterized by historically low dismissal rates.

Unemployment benefits application unexpectedly plummeted to multi-decade lows, in stark contrast to market forecasts of a cooling trend.

The persistent labour market tightness complicates US macroeconomic outlook for new Fed chair - Kevin Warsh, especially (now) with an escalating geopolitical friction introduces fresh inflationary risks.

Weekly claims.

For the week ending 18 Jul 2026, weekly claims fell by -22,000 to 187,000 vs Reuter’s estimates of 212,000 vs previous week’s upwards revised 209,000. (see below)

Its 4-week average also decreased to 207,500, dropping from previous week's revised average of 214,750.

According to US Dept Labour - latest numbers marked the lowest seasonally adjusted tally since September 1969.

Continuing claims.

For week ending 11 Jul 2026, continuing claims also fell by -2,000 to 1.796 million vs previous week’s downwards revised 1.798 million.

Week to week, there’s no change to the narrative of a "slow hire, slow fire" balance, keeping the overall job market steady.

For now, the higher commodity and fuel expenses have not forced widespread domestic layoffs or broken employment stability yet.

However, with the Middle East tension escalating again, no one is 100% certain, peace can be maintained, under the current volatile US government.

S&P Flash Services PMI - Prelim.

The preliminary July 2026 report for S&P Flash Services PMI reveals an 8-month high in overall business growth.

The Business Activity Index jumped to 53.6, up from June 2026’s 51.2 and exceeded analysts' estimates of 51.3, hitting the fastest growth since November 2025. (see above)

Selling prices for services rose at the fastest rate in nearly 4 years

It is a mixed report - while US service sector growth is strong (above the 50 mark) and hiring up, partly driven by events like the World Cup, however the faster price increases mean inflation pressures remain persistent.

S&P Flash Manufacturing PMI - Prelim.

The preliminary July 2026 report for S&P Flash Manufacturing PMI continued to show growth (staying above the 50 mark), though it has slowed to a 4-month low and missed analysts’ estimates.

The PMI score was 53.8 vs analysts’ estimates of 54.3 vs June 2026’s 53.9; dipping marginally from last month’s readings.

Manufacturing confidence slipped to its weakest since October, weighed down by:

• Softening demand.

• Global trade concerns.

• Tariffs.

• Geopolitical uncertainty.

• Elevated costs.

The slight dip to 53.8 also suggests that while growth persists, the pace may be slowing.

That could impact investors’ sentiments and market dynamics.

This is particularly relevant for sectors that rely heavily on manufacturing output.

My viewpoints: (mine only)

Taken together, the 4 reports point to an US economy that is still growing, but with a mixed quality:

• Leading indicators softened a bit.

• Labour remains very tight.

• July’s PMI data showed stronger services activity but slower manufacturing momentum.

The Fed will likely see this as a sign that growth is resilient enough to avoid a recession, but not weak enough to warrant a lower interest rate.

All the while the PMI reports’ inflation signals make interest rate cut harder to justify. but something current Fed chair will endeavour, as returning a favour to his nomination.

Week of 27 Jul 2026.

In the last trading week of July 2026, I think US market will remain tense as the FOMC proceeds with meeting and inflation worries, stemming from oil nearing $100 per barrel, raising chances of a rate hike.

At the same time, as big tech companies like $Microsoft(MSFT)$ , $Amazon.com(AMZN)$ , $Meta Platforms, Inc.(META)$ and $Apple(AAPL)$ will release their second quarter earnings’ respectively,

They will face the same fear/concerns as INTC, that is - massive AI spending with too little proof of profit.

No doubt, any escalating geopolitical risks in the Middle East and new tariffs will add more pressure on US market’s sentiment.

Of the 3 indexes, Nasdaq will be the most vulnerable with the Dow holding up better with defensives, and the S&P 500 sitting in between. Do you think so too ?

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