Market Summary - July 31, 2026
Overview
The market experienced a significant rebound on Wall Street, driven primarily by technology companies, with all major US indices showing strong gains. The Dow Jones increased by 1.2%, the S&P 500 rose by approximately 1.7%, and the Nasdaq led the charge with a remarkable 2.8% increase.
Key Performers
Microsoft was a standout performer, surging approximately 15% following the release of robust earnings. Other notable gains included Micron (up 18%), AMD (up 15%), and Sandisk (up 25%).
Amazon also reported impressive results, with a 20% year-over-year revenue increase to $200.6 billion. The AWS segment was particularly strong, achieving a 37% revenue growth to $42.2 billion, marking its fastest growth in 18 quarters. However, Amazon's earnings per share (EPS) of $5.75 was bolstered by a one-time gain from its investment in Anthropic, and the company announced further increases in capital expenditure to support its AI and cloud ambitions.
Apple's earnings report showed a 16% revenue increase to $109.4 billion, with EPS at $2.02. Despite strong iPhone sales and record service segment performance, the market reacted negatively due to weaker-than-expected results in the services segment and mixed sales data from China, leading to a decline in Apple shares during extended trading.
Asian Markets Reaction
Asian markets mirrored the positive sentiment from the US, with the South Korean KOSPI rising about 1.7%, driven by a rebound in the semiconductor sector, particularly Samsung Electronics and SK Hynix. Japan's Nikkei 225 saw a robust rally, increasing over 5%, as investors responded favorably to the tech sector's performance and the positive outlook for semiconductor and AI-related companies.
Macroeconomic Insights
Despite the strong market performance, macroeconomic data presented a mixed picture. The US Q2 GDP growth was reported at 1.5%, below the expected 2.1%, but consumer health remained solid. PCE inflation matched forecasts at 3.4%, and initial jobless claims fell to 197,000, indicating a resilient labor market.
The Bank of Japan maintained its interest rates, and preliminary data showed a 1.3% month-over-month increase in industrial production, exceeding expectations. However, China's Manufacturing PMI fell to 49.2, indicating continued contraction in the sector.
Currency and Commodity Markets
The USD/JPY currency pair rebounded above the 160 level, recovering from previous losses. In the commodities market, gold prices fell by approximately 0.5%, trading below $4,100 per ounce, while silver also saw modest losses.
Cryptocurrency Market
The cryptocurrency market faced challenges, with Bitcoin down around 0.6%, testing the $64,000 level, and Ethereum hovering around $1,900.
Conclusion
The overall market sentiment was buoyed by strong earnings from major technology firms, particularly those involved in AI, despite some mixed macroeconomic indicators. Investors remain optimistic about the potential of AI infrastructure investments translating into tangible results.