The S&P 500 Index ($SPX) (SPY) today is up +0.19%, the Dow Jones Industrial Average ($DOWI) (DIA) is up +0.11%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up +0.03%. September E-mini S&P futures (ESU26) are up +0.19%, and September E-mini Nasdaq futures (NQU26) are up +0.04%.

Stock indexes are posting modest gains today, with the S&P 500 climbing to a 3-week high. Stocks are finding support from lower crude oil prices today, as geopolitical risks eased slightly. Discussions between the US and Iran on a peace agreement are expected to continue despite the hostilities this week, which led to a steep drop in traffic through the Strait of Hormuz. Gains in stocks are muted amid weakness in chipmakers and AI infrastructure stocks.

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The outlook for strong Q2 earnings, which will begin to be released next week, is a bullish factor for stocks. Forecasts compiled by Bloomberg Intelligence suggest Q2 earnings may increase by +23%, close to Q1’s blowout earnings of +30%, which was more than double the +12% analysts had expected. AI spending is expected to account for most of earnings, with AI infrastructure stocks set to contribute nearly 60% of the S&P 500's earnings-per-share growth in Q2.

WTI crude oil (CLQ26) is down -0.51% today after an American official said talks between the US and Iran over a permanent peace deal are continuing, as the US remains committed to a diplomatic solution with Iran despite this week's hostilities. Also, Al Jazeera reported today that Qatar said it supports all efforts to defuse US-Iran tensions. Losses in crude are limited after Iran vowed to respond to the US attacks this week on Iran’s rail and maritime infrastructure. On Wednesday, President Trump said the ceasefire with Iran is over, raising the prospect of persistent hostilities in the region that could disrupt energy supplies. The US on Tuesday also revoked the Iran oil waiver that allowed buyers to purchase and transport Iranian oil legally.

The markets are discounting a 24% chance of a +25 bp rate hike at the next FOMC meeting on July 28-29.

Overseas stock markets are mixed today. The Euro Stoxx 50 is down -0.14%. China's Shanghai Composite fell from a 1-week high and closed down -1.00%. Japan's Nikkei-225 Stock Average closed up +1.20%.

September 10-year T-notes (ZNU6) today are up +1 tick, and the 10-year T-note yield is down -0.2 bp to 4.549%. T-notes are slightly higher today amid weakness in stocks, which boosted some safe-haven demand for T-notes. Also, bond dealer short covering is boosting T-note prices, as dealers have lifted short positions in T-notes to hedge this week’s new Treasury supply of $119 billion in T-notes and T-bonds.

European government bond yields are moving lower today. The 10-year German bund yield is down -1.2 bp to 3.072%. The 10-year UK gilt yield is down -1.5 bp to 4.882%.

Italy May industrial production fell -0.3% m/m, weaker than expectations of -0.2% m/m and the biggest decline in 4 months.

Swaps are discounting a 12% chance of a +25 bp ECB rate hike at its next policy meeting on July 23.

Chipmakers and AI infrastructure stocks are moving lower today, weighing on the overall market. The iShares Semiconductor ETF (SOXX) is down about -1%. Intel is down more than -3%, and Lam Research (LRCX), Marvell Technology (MRVL), ON Semiconductor (ON), KLA Corp (KLAC), and Applied Materials (AMAT) are down more than -2%. In addition, ASML Holding NV (ASML), Microchip Technology (MCHP), ARM Holdings Plc (ARM), NXP Semiconductors NV (NXPI), Analog Devices (ADI), Seagate Technology Holdings NV (STX), Western Digital (WDC), and Texas Instruments (TXN) are down more than -1%.

WD-40 Co (WDFC) is up more than +23% after boosting its full-year net sales forecast to $652 million to $667 million from a previous forecast of $630 million to $655 million.

EquipmentShare.com (EQPT) is up more than +17% after raising its full-year adjusted core Ebitda estimate to $1.95 billion to $2.06 billion from a previous estimate of $1.88 billion to $2.00 billion. The company also announced a $500 million share buyback program.

Jackson Financial (JXN) is up more than +10% after Jeffries upgraded the stock to buy from hold with a price target of $140.

Circle Internet Group (CRCL) is up more than +8% after receiving approval from the US Comptroller of the Currency to establish “First National Digital Currency Bank,” a national trust bank that will offer digital asset services.

Meta Platforms (META) is up more than +5% to lead gainers in the S&P 500 and Nasdaq 100 after research firm SemiAnalysis posted a positive report on the company’s AI compute business.

Weyerhaeuser (WY) is up more than +4% after Raymond James upgraded the stock to strong buy from outperform with a price target of $30.

Twilio (TWLO) is up more than +2% after Stifel upgraded the stock to buy from hold with a price target of $260.

Toll Brothers (TOL) is up more than +2% after Citigroup upgraded the stock to buy from neutral with a price target of $176.

Sensient Technologies (SXT) is down more than -4% after holder Freemont Capital announced the sale of as much as $237.7 million shares of Sensient via an unregistered block trade.

Netflix (NFLX) is down more than -3% after the Wall Street Journal reported on steps the company is considering to counter signs of declining subscriber engagement.

Delta Air Lines (DAL) is down more than -2% after reporting Q2 passenger revenue of $15.61 billion, below the consensus of $15.63 billion.

Delta Air Lines Inc (DAL), Frequency Electronics Inc (FEIM), Hingham Institution For Savings (HIFS).

On the date of publication, Rich Asplund did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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