Stock Market Update

Equity futures point to a higher open this morning after stocks finished mostly lower yesterday. Action was relatively subdued, but a notable intraday surge in oil prices followed reports of escalating tensions in the Middle East, weighing on the broader market.

Crude oil is moving modestly lower this morning despite Bloomberg reporting that Iran wants to require compensation from "hostile countries" before they are allowed to use the Strait of Hormuz, with the U.S. insisting on free transit through the Strait of Hormuz.

Investors are awaiting an important labor data point at 8:30 a.m. ET in the form of the July Employment Situation Report, which is expected to show nonfarm payrolls increasing by 86,000 (Briefing.com consensus) and the unemployment rate remaining steady at 4.2% (Briefing.com consensus).

Additionally, the market has plenty of earnings results to assess from yesterday afternoon and this morning, and while there are some notable moves in the mix, the most recent slate lacks some of the market-moving potential from previous rounds this week.

While the past two sessions have been relatively underwhelming, the major averages are still on track for impressive weekly gains due to big moves from hyperscalers and semiconductors earlier in the week.

In corporate news:

• Airbnb (ABNB 162.88, +11.24, +7.4%) beat EPS expectations by $0.11, reported revenues in-line, guided Q3 revs above consensus, and expects FY26 revenue growth to improve to at least mid-teens. 
• Alphabet (GOOG 356.78, +0.16, +0.0%) plans on consolidating AI leadership in the U.S., according to Financial Times.
• Cloudfare (NET 328.95, +44.52, +15.7%) beat EPS expectations by $0.02 and beat revenue expectations.

Reviewing overnight developments:

Equity indices in the Asia-Pacific region ended the week on a mixed note. Japan's Nikkei: -0.1%, Hong Kong's Hang Seng: +0.5%, China's Shanghai Composite: +1.0%, India's Sensex: -0.6%, South Korea's Kospi: -0.6%, Australia's ASX All Ordinaries: -0.1%.

In news:

• China reported a larger-than-expected trade surplus for July, though the total was down from June's record level of $125 bln.
• Chinese AI models from Alibaba and Moonshot are becoming more expensive.
• President Trump implemented a 15% tariff on polysilicon products from China and announced a price floor.

In economic data:

• China's July trade surplus $112.50 bln (expected surplus of $108.60 bln; last surplus of $125.62 bln). July Imports 27.5% yr/yr (expected 27.9%; last 36.0%) and Exports 23.9% yr/yr (expected 22.2%; last 27.0%)
• Japan's June Household Spending -6.4% m/m (expected -3.1%; last 3.7%); -3.3% yr/yr (expected 0.8%; last -0.4%). June Leading Index 116.4 (expected 116.5; last 116.4) and Coincident Indicator 0.3% m/m (expected 0.4%; last -0.2%)

Major European indices trade in the green. STOXX Europe 600: +0.7%, Germany's DAX: +0.8%, U.K.'s FTSE 100: +0.7%, France's CAC 40: +0.4%, Italy's FTSE MIB: +0.4%, Spain's IBEX 35: +0.3%.

In news:

• FT reported that the European Central Bank was not aware of the Fed's participation in the yen intervention last week.
• Insurer Allianz beat profit expectations for Q2 while Daimler reported weak results.

In economic data:

• Germany's June trade surplus EUR15.4 bln (expected surplus of EUR17.2 bln; last surplus of EUR19.4 bln). June Imports 4.4% m/m (expected 1.0%; last -2.6%) and Exports 0.9% m/m (expected 0.2%; last 1.1%). June Industrial Production 0.2% m/m (expected 0.2%; last 0.7%); 0.0% yr/yr (last -0.1%)
• France's Q2 Unemployment Rate 8.3% (expected 8.2%; last 8.1%). June trade deficit EUR5.8 bln (expected deficit of EUR6.5 bln; last deficit of EUR7.7 bln). June Current Account deficit EUR1.40 bln (last deficit of EUR1.20 bln)
• Swiss Q3 SECO Consumer Climate -33 (expected -34; last -40)