General Market News

Coca-Cola has increased Diet Coke prices by over 10% in India due to the U.S.-Israeli war on Iran disrupting aluminum can supplies through the Strait of Hormuz. The company replaced its popular 300-ml cans with larger 330-ml cans at higher prices, sourcing them from Southeast Asia as supply chain disruptions continue.

• Diet Coke's new 330-ml cans are priced at 50 rupees versus 40 rupees for the previous 300-ml size, representing a 13.6% per-ml price increase
• The Strait of Hormuz, a critical supply route for aluminum cans to India, has been virtually shut down due to the Middle East conflict
• Diet Coke is particularly vulnerable in India as it is sold predominantly in aluminum cans, unlike other Coca-Cola products which are available in plastic and glass bottles

Finnish biofuel maker and oil refiner Neste reported second-quarter core profit that came in slightly below market expectations on Friday. Despite the miss, the company achieved a record-high sales margin in its renewable products business segment, indicating strong performance in its sustainable fuels division.

• Core profit for Q2 fell short of analyst forecasts, suggesting potential headwinds in the company's traditional operations
• Renewable products business achieved record-high sales margins, highlighting strength in Neste's transition toward sustainable fuel production
• The mixed results reflect both challenges in conventional refining and growing success in the biofuel sector

The Trump administration announced new tariffs of 10% and 12.5% on imports from 60 trading partners, effective Friday as a temporary 10% global tariff expires. The tariffs, imposed under Section 301 of the Trade Act of 1974, target countries including Canada, Mexico, India, China, Taiwan, and the European Union, citing enforcement of forced labor import bans.

• Canada, Mexico, India, and China will face 10% tariffs, while Taiwan and the EU will be subject to 12.5% duties
• Many products are exempt including oil and gas, fertilizer, certain food products, and goods already facing Section 232 national security tariffs on automobiles, steel, aluminum, and copper
• The new tariffs follow the Supreme Court's February ruling striking down Trump's 'reciprocal' tariffs of 10% to 50%, and are part of a broader trade policy push including steep duties on generic drugs and additional Canadian imports

President Trump imposed new global tariffs of 10-12.5% on 60 countries under a forced-labor justification, replacing a temporary tariff set to expire July 24. Major trading partners including Australia, Brazil, Chile, Canada, and New Zealand rejected the forced-labor rationale while mostly signaling continued negotiations rather than retaliation. The tariffs cover 99.4% of American imports and provide a more legally durable foundation after the Supreme Court struck down Trump's earlier emergency-powers tariffs in February.

• Countries face 10% tariffs if they have adopted forced-labor import bans or 12.5% if they have not, with the measure applying to the top 60 U.S. trade partners
• Brazil faces a combined 37.5% tariff rate (12.5% forced-labor plus existing 25% Section 301 tariff), approaching the 50% rate previously ruled unlawful
• Analysts say the investigation is less about labor standards and more about pressuring countries to adopt Washington's ban on Chinese forced-labor goods while rebuilding the tariff regime struck down by the Supreme Court

The 21 APEC member economies, including the U.S. and China, released a joint statement supporting open-source AI development with 'strong security assurance' through development and deployment. The statement emphasizes respect for security, data protection, and intellectual property rights, marking the first minister-level agreement on open-source AI cooperation. This reflects a shift toward greater state oversight of AI as China leads recent open-source development amid U.S. restrictions.

• Open-source AI models from Chinese companies like DeepSeek and GLM 5.2 are free to download and use, contrasting with closed, pay-to-use models from U.S. firms like Anthropic
• The statement signals Asia-Pacific's move away from closed models toward open-weight systems combined with state-coordinated energy, telecom, and digital infrastructure
• The agreement bridges 'open vs. closed' debate by focusing on building trusted open ecosystems with testing, transparency, data protection, and deployment controls acceptable to governments and enterprises

The Trump administration has imposed new tariffs of 10% to 12.5% on 60 countries, including the UK, Canada, China, Mexico and the EU, citing their failure to prevent forced labor in imports. The levies take effect immediately, replacing previous tariffs that were ruled illegal by the Supreme Court. The move has drawn international criticism, with Brazil calling it 'arbitrary and unjustified' and several nations threatening retaliation.

• Tariffs range from 10% to 12.5% and target countries representing the majority of US imports, with the UK facing a 10% levy and Brazil facing 12.5%
• The measures are imposed under Section 301 of the Trade Act of 1974 and replace previous tariffs that were declared illegal by the Supreme Court
• Exemptions will be granted for materials that would face shortages or cannot be produced domestically in sufficient quantity at reasonable prices

The global economy remains supported by tech spending and consumer activity, but warning signs are emerging. High-end consumer spending tracker shows decent results, but discretionary card spending trends are falling rapidly, possibly due to higher energy prices. Canada's economy is particularly fragile, posting two consecutive quarters of negative GDP, though the TSX continues to rise driven by financials contributing 7.5% of market gains.

• Wealthy consumers continue to drive economic impact with decent high-end spending (cosmetics, restaurants, luxury), but discretionary card spending trends are declining quickly
• Canada experienced two back-to-back negative GDP quarters, with inflation-adjusted retail sales flatlining since early 2025, though employment has seen recent improvement
• Canadian banks are the biggest contributor to TSX gains (7.5%), while the market diverges from economic fundamentals supported by strong flows and AI-related excitement

Mortgage rates climbed to their highest level in nearly a year, with the 30-year fixed-rate mortgage reaching 6.58% this week, up from 6.55% last week, according to Freddie Mac. This marks the highest rate since August 2025, driven by elevated Treasury yields and geopolitical tensions affecting inflation concerns. The rate increase comes as housing market conditions show modest improvement for buyers, with home price growth expected to slow to 1.2% in 2026.

• The 30-year fixed mortgage rate hit 6.58%, the highest since August 21, 2025, while the 15-year fixed rate rose to 5.96% from 5.93%
• Rates are being influenced by the 10-year Treasury yield at 4.699% and concerns about inflation from elevated oil prices due to renewed U.S.-Iran conflict
• Realtor.com forecasts home price growth will slow to 1.2% in 2026, below the inflation rate, meaning real home prices would effectively decline

Escalating tensions between the U.S. and Iran are driving up oil prices above $100 per barrel, causing bond yields to rise and increasing borrowing costs across the economy. The 30-year mortgage rate hit 6.58%, its highest since last August, while the 10-year Treasury yield breached 4.7%. These developments are raising concerns about renewed inflation and potential Federal Reserve rate hikes.

• The 30-year fixed mortgage rate reached 6.58%, the highest level since August, while the 10-year Treasury yield topped 4.7% as Brent crude oil prices surged back above $100 per barrel
• Bond market analysts warn that sustained hostilities could keep oil prices elevated longer, maintaining upward pressure on inflation and potentially justifying a Fed rate hike as early as September 16
• Higher bond yields may cause 'choppiness' in stock markets this summer, as increased borrowing costs could weigh on corporate earnings while making bonds more attractive relative to riskier equities

President Trump will impose new tariffs of 10% to 12.5% on 60 trade partners, covering over 99% of U.S. trade, effective Friday at 12:01 a.m. ET. The duties, imposed under Section 301 for alleged forced-labor violations, will replace expiring temporary 10% global tariffs and represent what the administration calls the most sweeping international labor rights action ever taken.

• The new tariffs apply to 60 countries plus the EU and take effect as Trump's temporary 10% global tariffs under Section 122 expire after 150 days
• Duties are being imposed under Section 301 of the Trade Act of 1974, one of the tools Trump has used since the Supreme Court struck down his 'liberation day' tariffs on Feb. 20
• The administration also recently imposed tariffs on Brazil (effective Wednesday) and announced 50% tariffs on a wide range of goods set to begin next month

US stocks fell sharply on Thursday, with the Dow down 507 points (1%), the S&P 500 down 1.2%, and the Nasdaq down 2.2%. The selloff was driven by oil prices surging above $100 per barrel amid escalating Middle East tensions and disappointing earnings from Alphabet and Tesla that heightened concerns over expensive AI infrastructure investments. The oil spike pushed the 10-year Treasury yield above 4.7%, raising inflation fears and shifting Fed rate cut expectations.

• Brent crude climbed 7% to $100.69 per barrel after Houthi attacks on Saudi tankers and Trump's threats of military action against Iran, reigniting inflation concerns.
• Alphabet raised its 2026 capex guidance to $195-205 billion (from $180-190 billion), while both Alphabet and Tesla reported negative free cash flow and rising operating expenses, pressuring tech valuations.
• The 10-year Treasury yield rose above 4.7% (highest since January 2025), and Fed funds futures now price an 82% probability of a September rate hike, up significantly from a week earlier.

Oil prices surged approximately 7% after Houthi forces attacked Saudi oil tankers in the Red Sea and announced a maritime blockade on Saudi Arabia. Brent crude climbed above $100 per barrel while WTI oil rallied toward $92, as traders feared major supply disruptions. The attacks limit Saudi Arabia's oil export routes, potentially forcing shipments through longer routes around Africa.

• Houthis attacked two tankers using missiles and drones in the Red Sea, prompting President Trump to warn that Iran and Houthis would face punishment for further attacks
• The blockade threatens the Bab al-Mandab Strait, eliminating Saudi Arabia's alternative to the Strait of Hormuz and forcing oil shipments to route around Africa to reach Asian markets
• Natural gas gained modestly after EIA reported a storage build of +32 Bcf versus expectations of +35 Bcf, with resistance at the $3.00-$3.05 range

The Federal Energy Regulatory Commission is considering major reforms to PJM Interconnection, the largest U.S. power grid serving 67 million people across the Mid-Atlantic and Midwest. PJM faces power shortages and surging electricity prices driven by data center demand growth over the past two years, prompting calls for greater board independence and transparency from federal and state officials.

• Proposed reforms include extending PJM board member terms from three years to six to nine years to prevent members from being ousted for unpopular decisions, and requiring board deliberations and votes to be made public
• Officials are also discussing giving state governors more formal decision-making power in the grid operator, though they currently only have political influence including the ability to cap power prices in auctions
• White House officials drew parallels to Texas's 2021 Winter Storm Uri grid failure, warning that PJM's governance structure and stakeholder process face similar problems that could lead to catastrophic outcomes

Brian Johnson, President Trump's nominee to lead the Consumer Financial Protection Bureau and a Capital One executive, testified before the Senate Banking Committee that he has not decided whether to support administration plans to fire most of the agency's workforce. Johnson pledged to keep an 'open mind' on staffing levels if confirmed. The statement comes amid existing plans by the administration to significantly reduce CFPB staff.

• Johnson stated he would take an open-minded approach to evaluating agency staffing levels rather than committing to the proposed mass layoffs
• The nominee is currently a Capital One executive, raising potential concerns about industry influence over the consumer protection agency
• The administration has pending plans to terminate the vast majority of CFPB staff, though Johnson has not committed to implementing these cuts

Investor expectations for a Federal Reserve rate hike in September have surged to 82% from below 53% a week earlier, driven by climbing oil prices amid U.S.-Iran conflict escalation. The shift comes as Brent crude hit $90/barrel and jobless claims fell to their lowest level since 1969, suggesting the Fed can focus more on inflation control than labor market health.

• Fed funds futures now price in 82% odds of a September rate hike, up from under 53% a week ago, while near-term meeting odds rose to 38% from 12%
• Brent crude reached $90/barrel for the first time since late May due to U.S.-Iran tensions, pushing U.S. gas prices to their highest in over a month
• Initial jobless claims dropped to 187,000, the fewest since 1969 when U.S. population was 60% of current levels, bolstering the case for Fed inflation focus

JPMorgan Asset Management's latest 'Guide to ETFs' reveals that AI-themed ETFs have become a top five theme by assets under management in Q2, despite experiencing a rough quarter. The report also highlights a broader shift in investor preferences, with ETFs seeing continued inflows while mutual funds face negative flows over recent years.

• AI-themed ETFs have risen to top five by assets under management, with overlapping exposure to infrastructure, energy, and AI applications driving growth
• ETFs are increasingly preferred over mutual funds due to tax advantages, as ETFs typically avoid capital gains distributions that can hurt investors even in down markets
• Mutual funds have experienced negative overall inflows for several years, while ETF inflows continue to grow, a trend JPMorgan expects to persist

Congress split on war powers resolutions aimed at forcing President Trump to end hostilities with Iran as the conflict escalates. The Senate voted 47-49 to kill a joint resolution, while the House passed 214-208 a concurrent resolution expressing disapproval. The conflict's escalation has driven oil above $100 per barrel and threatens to impact upcoming midterm elections.

• Senate rejected the binding joint resolution 47-49, with only one Republican (Sen. Collins) voting for it and one Democrat (Sen. Fetterman) voting against it
• House passed a non-binding concurrent resolution 214-208 that expresses congressional disapproval but would not reach Trump's desk for signature
• Oil prices surged with Brent crude topping $100 and U.S. gas prices hitting $4.09 per gallon average, threatening Republican electoral prospects in the midterms

The week of July 27, 2026 brings a critical confluence of events as the Federal Reserve's July policy meeting and interest rate decision coincide with earnings reports from four of the 'Magnificent Seven' tech companies. Key economic data including second-quarter GDP and the PCE inflation index will also be released, making it one of the most significant weeks for Wall Street this year.

• Four Magnificent Seven companies report earnings next week, alongside other major names including Boeing, Mastercard, Visa, PayPal, Starbucks, and Coinbase
• The Fed's interest rate decision arrives Wednesday, July 29 at 2 p.m. ET, followed by Chair Kevin Warsh's press conference at 2:30 p.m. ET
• Critical economic data releases include advance Q2 GDP estimates on Thursday and the June PCE price index (the Fed's preferred inflation gauge) on Friday

Russia's oil and gas revenue is projected to surge 60% year-over-year in July 2026, driven by higher global oil prices and increased profit-based tax proceeds from second-quarter oil production. Despite the monthly jump, revenue for January-July is still expected to decline 11% compared to the same period in 2025, reflecting ongoing challenges in the sector that accounts for roughly one-fifth of Russia's total budget income.

• Oil and gas revenue for January-July 2026 is projected at 4.9 trillion roubles, down 11% year-over-year despite July's strong performance
• Russia's 2026 budget forecasts total oil and gas revenue of 8.92 trillion roubles ($113.7 billion), representing about 22% of projected total budget revenue of 40.283 trillion roubles
• Federal budget oil and gas revenue dropped 24% in 2025 to 8.48 trillion roubles, the lowest level since 2020, highlighting recent volatility in this critical revenue stream

U.S. equity holdings have overtaken real estate as the primary driver of household wealth accumulation for the first time since World War II, according to Goldman Sachs. This shift reflects strong stock market gains since the global financial crisis, particularly in the past three to four years. The change marks a significant transformation in how American household wealth is composed and exposes consumers to greater market volatility.

• Equity allocations among U.S. and Australasian households are approaching 50% of financial assets, exceeding levels seen during the dot-com era
• U.S., Australia, and Sweden have the highest equity exposure, while European and Japanese households remain comparatively under-invested in stocks
• Goldman warns that elevated equity exposure leaves households more vulnerable to sharp market corrections, especially amid high valuations and macroeconomic uncertainty