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Stock Markets Look to Close July With a Bang But the August Lull Looms
Updated July 31, 2026, 8:08 am EDT / Original July 31, 2026, 7:01 am EDT
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A furious end to an action-packed week for U.S. stocks will wrap up on Friday with indexes looking to close out the month of July on a high note.
The artificial intelligence investment trade roared back to life this week, with solid earnings, and increased spending plans. That was for three of the market’s four largest hyperscalers that stoked a massive rebound in chip stocks. There was also the biggest one day-gain for South Korea’s Kospi index on record.
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Microsoft added $450 billion in value on Thursday—its best day since 2008 and the largest single-day increase in any company’s market value ever—after it topped Wall Street’s forecasts and remained committed to its AI outlook.
Amazon looks set for a strong stock performance on Friday, after earnings and spending outlook published late Thursday.
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Apple will likely buck the trend, after a disappointing revenue forecast in Tim Cook’s CEO swan song, but broader markets are back on the AI bandwagon and set for the strongest two-day gains since early June.
Away from equities, currency markets saw a 3.3% surge for the yen that likely marked the first round of currency intervention prior to a Bank of Japan rate decision, which held rates steady at 1995 highs, in 15 years.
Brent crude, meanwhile, is likely to finish the month with a 24% gain as military strikes in the Middle East escalate and hopes for a summertime peace deal fade, hitting hopes the crucial Strait of Hormuz oil shipping route will reopen soon.
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The wild action to end the week, however, contrasts with a market that has found little direction since peaking in early June, and is pegged at roughly the same level it was some 77 days ago.
New life in the AI trade could be the spark that turns things around, but big risks tied to rates, war, and politics continue to linger. And the traditional August lull looms.
—Martin BaccardaxExternal link
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Amazon’s Capital Spending Will Rise. Wall Street Is Unfazed.
Amazon managed to avoid spooking Wall Street despite raising its capital spending allotment by another $20 billion. Cloud computing revenue is picking up, as is the need for it to invest in data centers, but its shares jumped 12% in premarket trading despite ballooning spending.
- Revenue for the quarter reached $201 billion, above expectations and up 20% on the year. Earnings of $5.75 a share were also well above projections and helped by $53 billion in nonoperational income, mostly an unrealized gain on the company’s stake in Anthropic, the privately held AI lab.
- The closely watched sales growth rate in the company’s Amazon Web Services segment was 37%, versus Wall Street’s expectation of 31%. AWS’ operating margin was 39%, well ahead of the analyst consensus and a big recovery for the unit’s financials.
- AWS is the oldest and largest cloud, and its growth rate is now getting closer to its smaller competitors, Microsoft Azure and Alphabet’s Google Cloud. Amazon’s $54 billion in capital spending for the quarter eclipsed operating cash flow by $8.8 billion, the second consecutive quarter of negative free cash flow.
- CEO Andy Jassy said it was raising capex guidance for the year to $220 billion. Even with all the spending on new data centers, AWS AI cloud demand seems to be outpacing it. The company has raised prices on AI server rentals twice this year, most recently a month ago.
What’s Next: New debt will offset the cash flow deficit. In July, it added a $25 billion offering to the $63 billion in long-term debt in the first half. Amazon also announced a $17.5 billion loan facility in June, though it hasn’t reported using it yet.
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At Apple, iPhone Sales Jump But So Do Memory Costs
Apple gave a disappointing revenue outlook linked to foreign exchange and supply chain challenges, weighing on its stock despite a stronger-than-expected June quarter. The forecast for September revenue is below Wall Street’s estimates, and investors are worried how long elevated memory costs will last.
- Apple posted fiscal third-quarter adjusted earnings of $2.02 a share, including a favorable 11 cent impact from tariff refunds. Apple reported stronger-than-expected sales for its flagship product as concerns about consumer spending loom. iPhone sales of $54.3 billion jumped 22%.
- During the company’s earnings call, Apple said it expects September quarter total company revenue to grow between 9% and 11% from the prior year. The midpoint of that is about $113 billion, below analyst estimates of $114.9 billion. Shares were down 7.2% after the guidance update.
- CEO Tim Cook talked about Apple’s decision to raise prices on Macs and iPads. Apple “reluctantly” lifted prices on some products earlier this year to offset some of the cost concerns as memory prices surged. The price hikes came after other firms had raised prices on their PCs and tablets.
- Cook says memory costs are likely to keep rising. Apple paid significantly more for memory in the June quarter than in the March quarter, he said on the earnings call. That detail won’t come as a surprise to investors. But the pressure is still getting worse, Cook says.
What’s Next: Memory has become a critical component needed to help power AI. Because demand is far outpacing supply, costs have surged. That’s led Apple and other hardware makers to raise prices in an effort to offset margin headwinds.
For Coinbase, Looming Legislative Vote Overshadows Earnings
Coinbase Global says it’s well on its way to becoming an “everything exchange” not dependent on the fickle digital assets market. But that’s the future. In the here and now, as shown by the company’s disappointing second-quarter earnings results, there’s no escaping a weak crypto market.
- It reported a loss of $1.36 a share compared with a $5.14 profit a year ago, while revenue fell to $1.2 billion from $1.5 billion. Chief Business Officer Shan Aggarwal told Barron’s they’re “focused on executing on the things that are under our control.”
- A 14% revenue drop from the first quarter reflected a slower trading environment, even as Coinbase’s market share increased, the company said, partly from products that only recently received the nod from U.S. regulators, including increased U.S. investor access to crypto derivatives.
- Subscription-and-services revenue made up 48% of Coinbase’s overall net revenue, the highest percentage since the third quarter of 2024. That stable income includes income generated by USDC, the stablecoin that Coinbase helped launch. But investors are focused on Capitol Hill and the Clarity Act.
- The legislation’s failure to advance—which as of Thursday afternoon looked increasingly likely —could pressure the stock further, while a surprise deal would likely reverse much of Coinbase’s stock losses on Thursday.
What’s Next: For Coinbase, the bill’s passage would ensure that a future White House won’t crack down on the industry, as happened during the Biden administration, and would give consumers and financial firms more reason to embrace digital assets. But has to overcome a 60-vote hurdle in the Senate, first.
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Why ‘Spider-Man: Brand New Day’ Will Outperform ‘The Odyssey’
During an already big summer for Hollywood, Marvel Studios’ Spider-Man: Brand New Day swings into theaters this weekend with projections that it could sell more than $200 million in domestic box office tickets, making it the biggest debut of 2026. Some industry watchers say it could sell $300 million or more.
- That would trounce Walt Disney’s Toy Story 5, which sold $159.7 million of tickets its first weekend in June, not to mention Universal’s The Super Mario Galaxy Movie, which debuted with $131.7 million in April; and Universal’s The Odyssey, which opened with $123.5 million two weeks ago.
- Although the R-rated Odyssey is “visually stunning,” Sony-distributed Spider-Man probably has a broader fan base, including among children, Eric Handler, Roth senior media and entertainment analyst, told Barron’s. The three previous Spider-Man movies starring Tom Holland have been tremendously popular, especially overseas.
- Paul Dergarabedian, Rentrak’s head of marketplace trends, said the combination of The Odyssey and Spider-Man will “absolutely light up movie theaters this weekend.” Spider-Man could push Hollywood’s August’s revenue above $1 billion for the first time since 2016, and boost summer ticket totals past $4 billion.
- Christopher Nolan’s The Odyssey just passed Amazon MGM’s Project Hail Mary to become one of this year’s top five Hollywood movies internationally. But The Odyssey still hasn’t opened in some key markets, including South Korea (Aug. 5), China (Aug. 14), or Japan (Sept. 11).
What’s Next: Spider-Man is opening in 4,300 North American theaters, more than Odyssey’s 3,919 locations when it opened, and is screening in China, South Korea, and Japan. The last film, Spider-Man: No Way Home, drew 58% of its $1.9 billion in ticket sales from outside the U.S.
— Newsletter edited by Liz Moyer, Patrick O’Donnell, Rupert Steiner
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