Ringside · Post-Bell · July 27
- Brent settled at $88.36, down 8.7% on the strike pause; energy shares lost 2.11%.
- Nvidia dropped 4.99% to $196.51 once China began mass-producing its own chipmaking machines.
- A September rate increase is now priced near 80%; Wednesday's meeting sits near 30%.
Indexes
Cheaper oil and cheaper chips pulled the market in opposite directions, and a nearly unchanged headline reading hides how wide the session was underneath. Brent settled at $88.36, down $8.42 from Friday, after Washington and Tehran each held fire through the weekend, and the energy sector fell 2.11% with it. Pushing the other way, a report that a Chinese company has started mass-producing advanced chipmaking machines knocked ASML down 8.4% in Amsterdam and took every large American chipmaker with it. Seven of the eleven sectors finished higher, staples leading at 1.46%, but energy and technology carry enough weight between them to hold the S&P 500 to a gain of 1.20 points. The Dow, which owns comparatively little of either, added 262.83 points, while the Nasdaq Composite gave up 43.74. Apple ended at a 52-week high of $336.91 and Nvidia lost 4.99%, and those two moves were enough to swap the pair at the top of the market-value rankings.
| Index | Close | % Chg | Note |
|---|---|---|---|
| S&P 500 | 7,413.18 | +0.02% | Traded a 94-point range to finish flat |
| Nasdaq Composite | 24,932.08 | -0.18% | Chip losses swamp Microsoft and Alphabet |
| Dow | 52,210.08 | +0.51% | 846 points under its July 6 high |
| Russell 2000 | 2,948.03 | +0.62% | Back above its 50-day at 2,932 |
Sector Heat Map
The two most crowded trades of July gave up their leadership on the same afternoon.
| Sector | % Chg | Sector | % Chg |
|---|---|---|---|
| Consumer Staples (XLP) | +1.46% | Materials (XLB) | +0.25% |
| Consumer Discretionary (XLY) | +1.31% | Real Estate (XLRE) | -0.41% |
| Communication Services (XLC) | +1.28% | Technology (XLK) | -0.90% |
| Financials (XLF) | +1.01% | Utilities (XLU) | -1.32% |
| Health Care (XLV) | +0.51% | Energy (XLE) | -2.11% |
| Industrials (XLI) | +0.30% |
Staples, discretionary and communication services each gained more than 1.2%, an unusual trio to lead a session together. The utilities loss of 1.32% is the more interesting one at the bottom, since that group has been traded as an artificial-intelligence power supplier all summer and fell in step with the chipmakers rather than with the bond market.
In the News
Rates, FX, Commodities
Buyers showed up along the whole curve, and slightly more of them at the long end. Ten-year notes finished at 4.641%, about five basis points lower on the day, and two-year notes came in near 4.30%, roughly three lower, since a Wednesday hold was already the working assumption. The two-year to ten-year spread ends at 34 basis points, two flatter than Friday, which is a very small adjustment for a session in which the barrel lost more than $8.
| Rates | Level | Note |
|---|---|---|
| 2-Year Treasury | 4.30% | Lower by about 3 bp |
| 10-Year Treasury | 4.641% | Lower by about 5 bp |
| 30-Year Treasury | 5.125% | Lower by about 4 bp |
| 2s10s Spread | +34 bp | Two flatter; unchanged since the open |
| Volatility, FX & Commodities | Level | % Chg |
|---|---|---|
| VIX | 18.67 | +0.48% |
| WTI Crude | $82.61 | -7.50% |
| Brent Crude | $88.36 | -8.70% |
| Gold | $4,079.60 | +0.64% |
| Nat Gas | $2.77 | -5.14% |
| Dollar Index (DXY) | 101.53 | +0.07% |
Volatility slipped to 17.60 in the morning and still finished higher, an unusual path for a session that opened on a peace headline.
Technicals
Between 7,386.55 and 7,480.57 the S&P 500 found nothing new, closing at 7,413.18, beneath both its 20-day average of 7,492.85 and its 50-day of 7,471.39. Those lines have converged to within 22 points of one another, so the 7,470 to 7,495 band is one obstacle this week rather than two. The Nasdaq Composite has much further to travel from 24,932.08, about 865 points under its own 20-day. Small caps did the best repair work: the Russell 2000 at 2,948.03 reclaimed a 50-day average of 2,932.31 that it had closed beneath on Friday.
In rates, the 10-year at 4.641% has moved back inside the band it respected through the spring, and 4.55% is where the bottom of that band sits.
Nvidia was down more than 5% by late morning and closed at $196.51, with its 200-day average of $192.96 immediately beneath.
Breakouts & Breakdowns
Breakouts
Apple (AAPL) — closed at $336.91, a 52-week high, leaving no overhead supply from the past year. The 20-day average of $317.04 is the first meaningful support beneath.
RTX (RTX) — $218.42 is also a fresh 52-week high, set two sessions after the company lifted full-year guidance to $7.10 to $7.25 a share. Monday's 2.65% advance came without company news, and with Lockheed Martin down 0.45% it was post-earnings buying rather than a defense bid. The 20-day sits at $197.66.
Breakdowns
Advanced Micro Devices (AMD) — $494.95 gives up the 50-day average of $509.47 and the $500 line in the same session. The 20-day at $531.73 converts to resistance.
Taiwan Semiconductor (TSM) — at $399.09 the shares sit below a 20-day and a 50-day stacked almost on top of each other near $426. The next reference underneath is the 200-day at $355.35.
Top Movers
Gainers
SAP (SAP) rose 6.88% to $171.01, a second leg to the advance that followed last week's second-quarter results. The figure drawing buyers is the current cloud backlog of 22.9 billion euros, up 27% against the 24% analysts modeled, which matters more here than the quarter itself. Management trimmed its operating profit range to 11.8 to 12.2 billion euros to absorb the Dremio and Prior Labs acquisitions, and buyers have now spent two sessions deciding the backlog outweighs the trim.
Reddit (RDDT) added 6.22% to $179.23 with no company news, days ahead of its own quarterly report. Advertising-linked names have been bid all month on the theory that a slowing artificial-intelligence spending cycle spares businesses selling attention rather than building capacity. The shares are still 34% below their 52-week high of $270.71.
Celestica (CLS) gained 4.25% to $318.24 during the session, then reported after the close and traded roughly 7% higher again. Adjusted earnings of $2.54 a share beat the $2.30 expected, communications and cloud revenue climbed 84% to $3.81 billion, and full-year guidance went to $20.5 billion of revenue and $11.30 of adjusted earnings a share, from $19.0 billion and $10.15 three months ago. It is a strange set of numbers to land on a day the market decided artificial-intelligence hardware was in trouble.
Microsoft (MSFT) rose 1.94% to $389.10 two days before it reports.
Losers
Nvidia (NVDA) fell 4.99% to $196.51 and was the single reason the Nasdaq Composite finished lower. The selling started with the report that China can now build immersion lithography equipment domestically, which shortens the useful life of export controls as a competitive moat. Losses ran across the group: Advanced Micro Devices dropped 5.17%, the VanEck Semiconductor ETF lost 2.25%, and Broadcom was the rare holdout at 0.34% higher.
ConocoPhillips (COP) lost 3.89% to $115.58, the weakest of the large American energy producers on a day when West Texas Intermediate gave back $6.70. Producers carry the most direct leverage to the barrel of anything in the sector, which is why they rose fastest through the escalation and fell hardest on its pause. Chevron declined 2.46% and Exxon Mobil 1.38%, the smaller losses befitting refining and chemicals divisions that collect something back when the input gets cheaper.
Micron Technology (MU) declined 2.25% to $900.20, holding the $900 level by twenty cents. Memory pricing has been the strongest part of the semiconductor story this year, and with the shares up roughly eightfold from their 52-week low, a domestic Chinese equipment supply chain threatens that scarcity over years rather than quarters.
Key Macro Data Today
| Release | Actual | Consensus | Prior |
|---|---|---|---|
| Durable Goods Orders (Jun) | +0.3% | +1.6% | -4.0% |
| Dallas Fed Manufacturing (Jul) | +1.3 | — | 0.0 |
Durable goods was the weaker of the two. Orders rose 0.3% against expectations closer to 1.6%, and May's decline was revised to 4.0% from the 4.5% first reported, so the two months together describe a manufacturing sector that has stopped falling without starting to grow. The Dallas Fed survey read better: general business activity turned positive at 1.3 from zero in June, with production up to 10.1 from 4.1 and new orders at 6.4 from 2.3.
Notable Earnings This Session
Pre-Open
AstraZeneca was the only large report before the bell, and its numbers were covered in this morning's issue.
Post-Close
Nucor earned an adjusted $4.84 a share against the $4.50 to $4.60 it guided to in June, on net sales of $10.40 billion that were 23% higher than a year ago. Diluted earnings came to $5.04 including a non-cash gain on its stake in the fusion company Helion. Steel mill shipments set a quarterly record for the second period running, and management expects third-quarter earnings to rise again. Celestica's results are covered above.
Drivers
1. Two days of Federal Open Market Committee meetings begin Tuesday. Markets put a move this week at roughly 30% and September at roughly 80%, so the committee can leave rates alone Wednesday and still change the picture through how many members dissent and how the inflation paragraph is worded. Consumer prices ran at 3.5% in June, and the barrel that helped push them there is still about 21% higher this month even after Monday.
2. Wednesday afternoon brings Microsoft and Meta Platforms; Apple and Amazon follow on Thursday. Cloud growth rates and next year's capital spending plans are the lines that get read before earnings per share, and Monday showed which way that reading currently cuts. Microsoft closed at $389.10, still under a 50-day average of $398.86 going into its report.
3. Options on oil are not treating this as finished. The OVX volatility measure on crude held near 68 through Monday's decline, per Saxo Bank, the most elevated corner of the volatility complex by a wide margin, which is not the pricing a resolved conflict produces. Tuesday brings Coca-Cola, Starbucks, Procter & Gamble and Arm Holdings, and SK Hynix reports in Seoul overnight.