Asia Market Quick Take – 24 July, 2026

Asia Market Quick Take – 24 July, 2026 

Key points:  

• Macro: Trump imposes 10-12.5% on 60 countries 
• Equities: Tesla drops 14.5% and Alphabet down 6.5% post earnings
• FX: US–Iran tensions lifted dollar; yen hit multi-decade lows, NZD underperformed 
• Commodities: Brent tops $100; gold pressured by rising real yields 
• Fixed income: USTs fall fourth day; yields at YTD highs 

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Disclaimer: Past performance does not indicate future performance.  

 Macro:  

• The Trump administration imposed 10%–12.5% tariffs on 60 countries accused of allowing forced labor, replacing emergency levies voided by the Supreme Court. The measures, effective July 24, target major partners including Mexico, Canada, China, and the EU, many of which contest the designation.
• Japan’s annual inflation rose to 1.7% in June 2026 from 1.5% in May, the highest since December, mainly as reduced energy subsidies slowed the decline in electricity and gas prices. Inflation picked up in several categories, while food inflation eased to 3.2% amid falling rice prices. Core inflation climbed to 1.6%, its highest since March but below the Bank of Japan’s 2% target for the fifth month in a row.
• The ECB left rates unchanged in July after a 25 bp hike in June, shifting to a wait-and-see stance amid softer inflation, wage growth, activity, and expectations. It said energy prices remain volatile but broadly in line with forecasts, warning that prolonged high energy costs could still fuel broader inflation through indirect and second-round effects.
• The US trade deficit widened to $77.6 billion in May 2026 from $54.6 billion in April, the largest since March 2025, as imports rose and exports declined, pointing to a bigger drag from net exports on Q2 GDP amid ongoing US trade-policy uncertainty.
• The Chicago Fed National Activity Index improved to -0.02 in June 2026 from -0.19 in May, with gains in sales, orders, inventories, and personal consumption and housing offsetting weaker production and steady employment indicators. The three-month average rose to -0.05 from -0.10.
• Trump threatened “major military punishment” against Iran and the Houthis over any further Red Sea shipping attacks and said he was weighing a “massive attack” on Iran, after Iran-backed Houthi strikes on two Saudi oil tankers as part of a new blockade of Saudi ports. 

Equities:  

• US — The S&P 500 fell 1.2% to 7,408.30 on Thursday, its worst session in a month, as Brent topping $100/bbl stoked inflation fears and disappointing Magnificent Seven earnings rattled sentiment. The Nasdaq 100 dropped 1.9% and the Dow fell 1.0% to 51,711.65. Tesla plunged 14.5%, its biggest drop since March 2025, after profit tumbled despite solid automotive revenue. Alphabet slid 6.5% on a higher-than-expected capex outlook of up to $205 billion for 2026. The Mag Seven gauge posted its worst day since the April 2025 tariff meltdown. After hours, Intel surged 4% after its Q3 revenue forecast of $15.8–$16.8 billion shattered the $15.1 billion consensus estimate, driven by data centre AI demand.
• EU — The Stoxx Europe 600 fell 1.2% to 639.27 on Thursday, its biggest drop since July 8, with banks leading declines. Nestle suffered a record single-day drop of 8.0% after reporting weaker North American volumes and a sharp fall in net profit. STMicroelectronics tumbled 17.7% — the index's largest mover — after forecasting below-consensus current-quarter sales, dragging Infineon down 6.2%. The DAX fell 1.6% to 24,763.12, the Euro Stoxx 50 dropped 1.69% to 6,210.17, and the FTSE 100 lost 0.7% to 10,639.17. UniCredit beat estimates but was overshadowed by concerns it may scrap its planned share buyback. SAP surged after hours after posting Q2 EPS of €1.89, well above the €1.68 consensus. 
• Asia — Asian equities are set for a broad decline at Friday's open following Wall Street's tech-led selloff and Brent's surge above $100. Equity index futures pointed to losses in Japan, South Korea and Australia. USD/JPY held near 163.81, the weakest level since 1986, raising concerns about imported inflation and the sustainability of Japan's equity bull run. Intel's blowout after-hours forecast is expected to provide a partial offset for Asian chip suppliers — Lasertec (33% of sales from Intel) and Ibiden (18%) are stocks to watch. In China, local state asset managers stepped up buying to support the market. Allianz announced it will acquire HSBC Life Singapore. South Korea is set to implement a basic deposit requirement on ETFs from July 31. Kospi 200 futures closed down 1.0% at 1,121.0 on Thursday. 

Earnings this week: 

• Friday: Verizon, American Express, NextEra Energy 

FX: 

• FX trading was dominated by a sharp escalation in the US‑Iran conflict, which sent Brent crude above $100 and sparked classic risk‑off flows into the USD. The Dollar Index hit its highest close since July 1, as traders fully priced a September Fed hike and even some odds of an additional move.  
• EURUSD slipped 0.31% to 1.1377, with hawkish ECB expectations already priced in and surging energy costs limiting upside, keeping the pair rangebound ahead of the next FOMC.  
• GBPUSD fell 0.45% to 1.3315 and is down 1.02% over five days, driven mainly by broad dollar strength rather than UK-specific news. 
• USDJPY climbed to 163.86, leaving the yen at multi‑decade lows and the BOJ’s nominal effective FX index at record weakness.  
• NZDUSD was the worst G10 performer, down 0.79% to 0.5772 amid risk‑off pressure on high‑beta, commodity‑linked currencies.  
• USDCNH edged up less than 0.1% to 6.7780 after the PBOC set its fixing at 6.7906. 

Commodities: 

• Brent crude closed above $100/bbl for the first time since May, up approximately 7% on the day to $100.69, as Houthi attacks on Saudi tankers in the Red Sea opened a new supply disruption front. WTI held near $92/bbl, up roughly 12% on the week — its biggest weekly gain in months. Kazakhstan also made temporary output cuts following a halt at the CPC export terminal, adding to supply concerns. 
• Gold has been in retreat since breaking below $4,000/oz in late June for the first time since November, as a resurgent dollar and rising Treasury yields weigh on bullion. Newmont reported Q2 net income fell more than 30% quarter-on-quarter, citing the gold price selloff and higher mine costs. 
•  Top-20 brokers on the Shanghai Futures Exchange boosted aggregate net-short copper positions to 21,230 contracts across the front seven months, up from 19,633 the prior session, reflecting caution around demand amid the broader risk-off tone and macro uncertainty. 

Fixed income:  

• US Treasury yields rose to their highest levels of 2026 on Thursday, with the 2-year yield climbing as much as 7bp to 4.37% and the 10-year yield pushing above 4.70% intraday before settling at 4.701% (+4.5bp). The 30-year yield reached 5.169% (+2.1bp). Treasuries have now fallen for four consecutive sessions, driven by surging oil, the jobless claims surprise, and mounting Fed rate hike pricing.
• The Treasury sold $110bn of 4-week bills at 3.73% and $100bn of 8-week bills at 3.795% (both record sizes). Demand for the 8-week tenor was notably softer than the 4-week, reflecting investor uncertainty ahead of the July 29 FOMC meeting. A 10-year TIPS auction also saw sub-par demand.
• Big-tech corporate bond spreads widened as AI debt concerns intensified, with Meta and Oracle leading the move. Municipal bonds suffered their biggest selloff since the April 2025 tariff rout, with 10-year muni yields rising 13bp to 3.3% — the highest since July 2025 — extending a losing streak to 13 consecutive sessions. JetBlue bonds fell more than 2 cents to ~84 cents on the dollar after the airline invited fixed income investors to a liquidity-focused meeting. 

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