Morning Brew August 4 2026

Good morning.

August starts on a constructive note, with equities pushing back toward record territory as easing Middle East tensions, solid earnings and early-month passive flows support risk appetite. The AI trade remains the key driver, but the market is also watching whether yields, oil and FX can stay calm enough to keep the rally intact.

Yields are still high, but at least their rise has paused for now. The U.S. 10-year is around 4.70%, Europe near 3.15%, the UK close to 4.96%, and Japan around 2.85%. That remains an uncomfortable backdrop for highly valued growth stocks, but the absence of another yield spike is helping sentiment this morning.

U.S. equities had a strong start to the week. The S&P 500 closed Monday up 1.5% at 7,600.50, within touching distance of its all-time high, while the Nasdaq 100 gained 1.8%. The move was helped by lower geopolitical risk and another solid round of AI-related earnings. Microsoft led the S&P 500 with a 4.9% gain, while Meta rose 6.7%, Alphabet gained 5.2% and Amazon added 4.6% after crossing a USD 3 trillion market capitalisation for the first time. Apple was the only Magnificent Seven laggard, slipping 0.5%. After the close, Palantir jumped 15% after raising its revenue and income forecasts, and Snap also delivered a better-than-expected revenue print.

Europe also joined the rally. The DAX rose 1.5% to 26,001 and reached a fresh intraday record, while the CAC 40 gained 1.6% and hit its first intraday record since 26 February. The Euro Stoxx 50 also moved to a new peak, and the Stoxx 600 added 0.4% to 652.09, just shy of its closing record. SAP was the standout European mover, rising 4.4%.

In FX, the USD Index is around 100, with EUR/USD at 1.1505, GBP/USD at 1.3420 and USD/JPY at 157.60. Gold is steady around 4,060, while silver is again testing the 59 area to the upside.

Headlines: Conflicting signals from the United States and Iran over efforts to end the five-month war are adding uncertainty this morning. The latest attack on shipping in the Strait of Hormuz is a reminder that global energy flows remain vulnerable. Oil is up 1.5% after falling more than 7% yesterday.

In a more unusual headline, the U.S. military is reportedly asking for creative and unconventional ideas by email on how to bring the Iran war to an end.

U.S. politics are also worth watching. A Reuters/Ipsos poll showed Americans choosing Democrats over Republicans as better stewards of the economy for the first time in nearly a decade, while President Donald Trump’s approval rating fell to 35%.

At the same time, 25 U.S. states are legally challenging the Trump administration’s latest tariff measures.

Energy policy is in focus as well. Trump accused ExxonMobil and Chevron of making “too much money” from higher fuel prices and said the oil majors should give some of it back to the public — a notable break from his usual alignment with the industry.

On the AI side, Meta, Anthropic, OpenAI and Google have been invited to meet White House officials today to discuss voluntary government safety testing for the most advanced U.S. AI models.

In IPO news, Shein is reportedly seeking a valuation of USD 30–40 billion in a Hong Kong listing.

Toyota reported a fifth consecutive quarterly profit decline, hurt by weaker sales in China and higher material and parts costs linked to the Iran war.

HSBC delivered a better-than-expected first-half profit and raised its net interest income target, supported by growth in lending and wealth management fees as money flows remained robust.

With only a light economic calendar today, Iran headlines and the first SpaceX earnings release after the IPO are likely to draw the most attention.

Tuesday, August 4, 2026

Macro: U.S. JOLTS job openings.
Central banks / speakers: Reserve Bank of Australia rate decision.
Corporate earnings: SpaceX Spotify, BioNTech, BP and several major European and U.S. companies.

Wednesday, August 5, 2026
Macro: U.S. ISM Services PMI; ADP employment report.
Central banks / speakers: No major central-bank decision scheduled.
Corporate earnings: Eli Lilly, Disney, Uber and several large-cap reporting names.

Thursday, August 6, 2026
Macro: U.S. initial jobless claims; Q2 productivity and unit labour costs; Challenger job-cut report.
Central banks / speakers: Alberto Musalem speaks; Fed balance sheet after the close.
Corporate earnings: ConocoPhillips, Parker-Hannifin, Howmet Aerospace, Canadian Natural Resources, Datadog, Constellation Energy, Petrobras, Cloudflare, Monster Beverage, Airbnb, Aflac and Republic Services.

Friday, August 7, 2026
Macro: U.S. Employment Situation report for July, including nonfarm payrolls, the unemployment rate and average hourly earnings; U.S. consumer credit later in the day.
Central banks / speakers: Thomas Barkin speaks.
Corporate earnings: Vistra, Take-Two Interactive, PPL, Plains All American Pipeline, Emera, Fluor and Hawaiian Electric.