Morning in New York: Investors Need New Signals

A daily review and forecast of events in the U.S. stock market by Mikhail Denislamov, Deputy Director of Freedom Capital Markets Research.

The continued lull in hostilities between the U.S. and Iran is contributing to a further decline in oil prices and easing concerns about disruptions to energy supplies. Against this backdrop, Brent is trading below $87 per barrel, while WTI is trading near $81. At the same time, the risk of a new round of escalation remains, as Washington has indicated it may resume strikes if negotiations fail, and shipping through the Strait of Hormuz and the Red Sea remains unstable. Given this situation, attention will focus on Donald Trump’s meetings with Israeli Prime Minister Benjamin Netanyahu and Ukrainian President Vladimir Zelenskyy. The agenda includes prospects for resolving the conflicts with Iran and in Ukraine, as well as the U.S.’s next foreign policy steps.

The Fed’s two-day meeting begins today. Futures markets are pricing in a roughly 35% probability of a rate hike. Analysts at Freedom Broker do not consider this the base case scenario, as recent inflation data and other macroeconomic indicators do not point to a need for further monetary tightening. This Tuesday will see the release of the Conference Board’s July Consumer Confidence Index (consensus: 92.4 points, June: 91.2) and preliminary data on wholesale inventories (consensus: +0.4% MoM, May: +0.1% MoM).

Before the start of the main trading session, Corning (GLW), Coca-Cola (KO), Boeing (BA), S&P Global (SPGI), PayPal (PYPL), Hilton Worldwide (HLT), and Royal Caribbean Group (RCL) will report their quarterly results. After the market closes, Seagate Technology (STX), Bloom Energy (BE), KLA Corporation (KLAC), Visa (V), Teradyne (TER), NXP Semiconductors (NXPI), and Ford Motor (F) will report their earnings.

Futures on U.S. stock indices are showing a moderately negative trend. We assess the risk balance for the upcoming session as neutral, with average volatility. If the S&P 500 holds above 7,450 points, it will signal a resumption of growth. A drop below 7,380 points will increase the likelihood of a corrective move. This is also being driven by the ongoing sell-off in Asian tech stocks, which has caused South Korea’s Kospi to fall by more than 10%, while Japan’s Nikkei 225 and Taiwan’s Taiex have each lost more than 4%.

— Applied Digital (APLD) shares are up about 3% as its quarterly revenue exceeded market expectations. Revenue more than quintupled compared to last year, reaching $258.7 million, thanks to the addition of new capacity and strong demand from customers developing AI infrastructure. The results confirmed the accelerating expansion of the data center business.

— Strong quarterly results and an upward revision to the annual forecast drove Celestica (CLS) shares up by about 5%. The company’s revenue reached $4.7 billion, and adjusted earnings per share (EPS) came in at $2.54, exceeding the upper end of its own guidance. Management revised its 2026 revenue and earnings per share guidance to $20.5 billion and $11.3, respectively, driven by sustained demand for data center equipment and AI infrastructure.

— Welltower (WELL) shares are up about 4% following the release of its latest quarterly results. Although the company’s earnings fell short of consensus estimates, revenue increased by 39% year-over-year to $3.54 billion, exceeding average market expectations due to strong demand for senior housing. In addition, the company raised its 2026 forecast for normalized funds from operations (FFO). The board of directors announced a quarterly dividend of $0.85 per share, which had previously been increased by 15%.

— Cadence Design Systems (CDNS) shares are up about 3% in response to strong earnings results and an upward revision to its full-year guidance. The company’s revenue, in line with average market estimates, increased 24% year-over-year, and adjusted EPS came in at $2.11, compared to a consensus estimate of $2.05. Management raised its guidance for this metric for 2026 from $7.85–7.95 to $8.05–8.15. The revenue forecast was also revised upward due to steady demand for chip design tools and artificial intelligence solutions.

— Noble Corporation (NE) shares are down about 5% after the company reported a loss in its quarterly earnings report. Adjusted EBITDA came in at $212 million, while operating cash flow reached $144 million. Despite securing new contracts worth approximately $200 million and maintaining its quarterly dividend at $0.50 per share, investors were disappointed by the downward revision to the outlook for the current year.

Trading on July 27 on U.S. stock markets ended with mixed results. The S&P 500 rose by a symbolic 0.02%, the Dow Jones rose by 0.51%, the Russell 2000 gained 0.62%, and the Nasdaq 100 fell 0.32%. Most indices were supported by improved risk appetite amid a ceasefire in the Middle East. A correction in chipmaker stocks put pressure on other tech sector stocks, resulting in the equally weighted S&P 500 outperforming the “classic” benchmark by nearly 0.8 percentage points. This reflects the broadening of the rally and the outperformance of stocks outside the big-tech sector.

Suppliers of essential goods (XLP: +1.46%) emerged as the top performers, buoyed by gains in grocery chains and other retail sector stocks. The energy sector (XLE: −2.11%) lagged behind due to a 7.5% drop in WTI crude oil prices. Among the “Magnificent Seven,” the most active buying was seen in Microsoft (MSFT: +1.94%) and Alphabet (GOOGL: +2.13%), while the biggest declines were seen in Nvidia (NVDA: −4.99%) and Tesla (TSLA: −1.22%).

This Monday’s macroeconomic data was mixed. Orders for durable goods in June came in below average market expectations, while core orders for capital goods and shipments of those goods exceeded the consensus. At the same time, the May data were revised upward. The Dallas Fed’s Manufacturing Activity Index rose in July from June’s zero reading to 1.3 points, although a reading of 3 points had been expected.

— D-Wave Quantum (QBTS: +20.4%) is expanding its partnership with AT&T (T: +1.2%), which plans to use its partner’s quantum technologies to optimize network operations, including resource allocation and maintenance management. The news has bolstered investors’ expectations regarding the further commercialization of D-Wave’s solutions.

— Baker Hughes (BKR: +5.8%) reported quarterly revenue, EPS, and free cash flow that exceeded consensus estimates. The company’s order volume increased by 49% year-over-year due to strong demand for LNG equipment, gas infrastructure, and data center power solutions. Against this backdrop, the company raised its 2026 order forecast for the Industrial & Energy Technology segment.

— Brown-Forman (BF.B: +5.1%) received a revised offer from Sazerac to acquire the company at $32 per share. The board of directors reiterated that the offer is not in the best interests of shareholders; however, the market reacted positively to the fact that the potential buyer remains interested.

— ASML (ASML: −5.8%) may face increased competition in one of its most important markets due to China’s launch of its own mass production of deep ultraviolet (DUV) lithography equipment. This is causing concern among investors, despite the technological lag of Chinese manufacturers.

This article was AI-translated and verified by a human editor