Market Summary - July 1, 2026

The financial markets experienced a slight softening on July 1, 2026, following a recent rebound. Key highlights include:

US Equities & Market Sentiment

US stock futures showed a slight decline ahead of the European market opening, pausing after a tech-led recovery in the previous sessions. The Nasdaq 100 and Russell 2000 futures were both down by 0.2%, while the S&P 500 and Dow Jones saw minor decreases of 0.15% and 0.1%, respectively. European indices, including the Euro Stoxx 50, mirrored this trend with a 0.2% drop.

Nike's Earnings Report

Nike reported an adjusted earnings per share (EPS) of 20 cents, surpassing the expected 13 cents, with revenues reaching $10.97 billion, bolstered by a significant $986 million tariff refund. However, the company faced a sharp decline in its stock price, dropping up to 8% in post-market trading due to disappointing sales in China (-12%) and weaker guidance for future earnings.

Asian & Pacific Markets

Asian markets traded without a clear direction, influenced by valuation concerns in the AI infrastructure sector and positive momentum from Wall Street. Despite wrapping up their best quarter in 17 years, investors are now focused on upcoming US labor market data and the potential for a rate hike in September, currently priced at 60% probability.

Japan's Nikkei 225 index rose by 1.79%, driven by gains in the semiconductor sector, while South Korea's KOSPI bounced back by 1.52% after a previous sell-off, although local tech stocks faced resistance despite significant gains since the start of 2026.

Economics & Central Banks

The June Tankan report indicated a rise in Japanese business confidence, with the big manufacturers' index increasing to +22, surpassing expectations. This positive sentiment supports a hawkish stance from the Bank of Japan, as firms raised their inflation expectations and capital expenditure plans.

In China, the manufacturing PMI remained in expansion territory at 51.7, marking the seventh consecutive month of growth, with new orders increasing and input cost inflation easing.

European Central Bank (ECB) officials adopted a softer tone regarding future monetary policy, suggesting a potential pause in rate hikes due to stabilizing oil prices and a lack of clear inflationary pressures.

Foreign Exchange (FX)

The dollar index rose by 0.15%, breaking out of a corrective phase, while the Australian dollar weakened against its G10 peers following softer-than-expected manufacturing data from China. The USD/JPY pair saw a slight increase of 0.15%.

Commodities, Energy & Metals

Gold futures fell below the psychological support level of $4,000, trading at $3,965/oz, while silver also experienced a decline, dropping 1.55% to $57.70/oz. Crude oil prices remained stable within a narrow range, with Brent crude futures down 0.2%.

Conclusion

The market's current sentiment reflects a cautious approach as investors await key economic data and navigate through mixed earnings reports and geopolitical factors.