The three major U.S. equity indices closed lower under pressure,$Russell 2000 Index (.RUT.US)$falling 0.92% to close at 2,959.938 points.NVIDIA (NVDA.US)rising 2.30%, while Meta dropped 2.58%.$Taiwan Semiconductor (TSM.US)$ADR declined 0.82%, while AMD rose 1.45%. The U.S. dollar remained largely range-bound, with the yen holding near 163.15. Spot gold briefly climbed back above $4,150 per ounce during the session, ending the day up 1.3% at $4,131.42 per ounce.
The U.S. military strikes against Iran entered their 11th day, pushing oil prices to a six-week high and reigniting inflation concerns. This revived the possibility of a Federal Reserve rate hike in July, dampening the momentum supporting tech stocks and driving long-end U.S. Treasury yields to historic highs.
Brent crude breached $95 per barrel intraday, while WTI settled 2.3% higher at $86.30. Dragged down by this move, the yield on U.S. two-year Treasuries rose to its highest level since February 2025, and money markets priced in an additional 5–6 basis points of hikes over the next year in a single day. Markets are now nearly fully pricing in two rate hikes by January of next year.
Traders have been closely monitoring the oil market, concerned that rising prices could push up consumer goods costs and ultimately force the Federal Reserve to raise rates. According to the CME Group’s 'FedWatch' tool, the probability of at least one rate hike by the conclusion of the Fed’s September meeting has now approached 80%.
Ian Lyngen, analyst at BMO Capital Markets, stated, 'The ongoing military strikes show no signs of abating, and diplomatic efforts to resolve the Middle East conflict have stalled. As U.S.-Iran hostilities intensify, rising energy prices continue to exert pressure on the U.S. Treasury market.'
Thomas Martin, Senior Portfolio Manager at Globalt Investments, said, 'U.S. inflation is indeed very high, but I don’t think the Fed can do much about it. What truly worries the market is where interest rates are headed next.'
Equity markets faced downward pressure but declines remained limited.$S&P 500 Index (.SPX.US)$closed down 0.1%,$NASDAQ-100 Index (.NDX.US)$fell 0.5%, while the Dow Jones Industrial Average was essentially flat. Nearly all gains from Tuesday’s short-covering rally were erased.
Google released its earnings after the market close, reporting cloud revenue significantly above expectations and a backlog of contracts exceeding $500 billion;$Tesla (TSLA.US)$earnings fell short of expectations, and shares of both companies declined by approximately 3% in after-hours trading.
Oil prices: Multiple supply shocks drive crude to new multi-week highs
According to Xinhua News Agency, U.S. President Trump said on Wednesday, the 22nd, that from now on, every time Iran fires upon vessels in the Strait of Hormuz, the United States will bomb and destroy an Iranian bridge or power plant.
Later that day, during the midday session of U.S. stock trading on Wednesday, Trump further stated that the U.S. had prevailed over Iran and no longer needed the Strait of Hormuz or cooperation with Venezuela for oil production.
Iran’s military issued a firm response to Trump’s threats, stating that if the United States strikes Iranian bridges or power plants, Iran will retaliate by targeting energy and other infrastructure in the region linked to U.S. interests.
Brent crude briefly breached $95 per barrel during the session, while WTI settled up 2.3% at $86.30. Saxo Bank noted that the price increase "reflects the ongoing 11-day U.S.-Iran conflict, Houthi threats to Red Sea shipping, and production cuts due to a tropical storm."
Ryan McKay, Senior Commodities Strategist at TotalEnergies Capital Markets, stated:
This latest escalation, along with Iran’s disruption of flow, has once again opened the door to more extreme right-tail scenarios, and the longer it persists, the greater this risk becomes.
He added that commodity trading advisors have re-entered long positions as Brent crude prices rose above $93, though volatility remains a key constraint.
Norwegian energy giant$Equinor (EQNR.US)$ ASA CFO Torgrim Reitan stated:
The geopolitical premium is evident. This time is very different, as inventories are declining and there is no supply surplus; tightness in the physical market is easily reflected in pricing.
Signals from the options market are also noteworthy. According to Bloomberg, the Brent crude risk reversal indicator has continued to rise over the past month and bottomed out before prices hit their June low.
The indicator turning positive and rising means traders are paying aimplied volatilitypremium for upside call options that exceeds that of equivalent downside put options, indicating the market perceives greater risk of supply-driven price increases than of a sharp price decline.
Interest Rates: Rate Hike Expectations Reignite, Long-End Yields Hit Multi-Year Highs
The oil price shock is forcing a repricing of monetary policy expectations through inflation expectations.
The overnight indexed swap (OIS) market priced in an additional 5 to 6 basis points of rate hikes in a single day, putting a July rate hike back on the table.
The two-year U.S. Treasury yield rose by 4.5 basis points on the day, reaching its highest level since February 2025; the 30-year Treasury yield climbed 2 basis points to around 5.14%.
Ian Lyngen of BMO Capital Markets noted:
Diplomatic efforts to resolve the Middle East conflict have effectively stalled, with ongoing military strikes showing no signs of abating. Rising energy prices continue to weigh on the U.S. Treasury market.
Bloomberg strategist Edward Harrison pointed out that if the escalation persists, rising expectations for rate hikes will further drive a bear-flattening of the yield curve. Should yields continue to rise, the impact would intensify and feed back into the long end, accelerating curve flattening.
The 30-year U.S. Treasury yield has traded above 5% on 27 days this year, representing approximately 19% of all trading days—the highest proportion since 2007. Tony Rodriguez, Head of Fixed Income Strategies at Nuveen Asset Management, stated:
Excessively high levels of sovereign debt and deficits are the core reason for persistently elevated long-end rates. Both governments and mega-cap technology firms are competing for the same pool of investors in the long-end credit market.
Hank Smith, Chief Investment Strategist at Haverford Trust, issued a more direct warning:
We believe the greatest risk to the markets—both bond and equity—is the potential return of the bond vigilantes.
Technology Stocks: Under Scrutiny Over AI Capital Expenditures, Large-Cap Names Broadly Under Pressure
Equities faced pressure from both oil prices and interest rates but posted limited losses. The S&P 500 closed down 0.1%, the Nasdaq 100 fell 0.5%, and the Dow Jones Industrial Average was essentially flat.
Almost all of yesterday’s gains, driven by short-covering, have now been erased.
Shares of leading artificial intelligence companies posted mixed performance today, while the S&P 500 index (excluding the AI sector) remained stable.
Ahead of Google’s earnings release tonight, the Mag 7 index showed mixed performance but closed lower overall, while the S&P 500 ended flat at 493.
Prior to its earnings announcement, Google’s share price briefly neared its intraday low.
In after-hours trading, Google ultimately reported cloud revenue that significantly exceeded expectations, with backlog surpassing $500 billion; Tesla, by contrast, fell short of market expectations. Shares of both companies declined by approximately 3% in after-hours trading as the market continues to digest the implications for broader tech-sector valuations.
According to Bloomberg, Ulrike Hoffmann-Burchardi of UBS Chief Investment Office stated:
“We remain constructive on the AI growth narrative but prefer a more balanced allocation across the AI value chain—from semiconductors and hardware to large-cap tech and more defensive segments within the sector. Investors should also ensure diversification beyond their AI exposure.”
Based on reported earnings so far, fundamentals remain supportive. RBC data shows that market expectations for full-year S&P 500 earnings growth have rebounded to 25%, although the rate of revenue beats has declined compared to last quarter, and the pace of earnings estimate revisions—across both large-cap and other firms—is slowing.
This combination suggests that companies are currently relying primarily on pricing power, cost control, and operational discipline to protect margins, rather than volume expansion.
Other assets: Gold strengthened,$Bitcoin (BTC.CC)$pulled back, and the U.S. dollar traded in a narrow range.
The U.S. dollar traded sideways overall, failing to extend its previous rally. The euro rose slightly by 0.1% against the dollar to 1.1411, while the British pound remained largely flat at 1.3374. The Japanese yen held steady near 163.15.
Supported by both safe-haven demand and inflation expectations, spot gold briefly reclaimed the $4,150 level during trading, rising 1.3% on the day to $4,131.42 per ounce.
Bitcoin ETFs recorded net inflows for the sixth consecutive trading day, though Bitcoin prices dipped slightly by 0.8% to $65,858, failing to hold above the $66,000 mark.
On Wednesday, all three major U.S. equity indices closed lower under pressure,Russell 2000 Indexwith the index falling 0.92% to close at 2,959.938. NVIDIA rose 2.30%, while Meta declined 2.58%. Taiwan Semiconductor ADR dropped 0.82%, and AMD gained 1.45%.
U.S. equity benchmark indices:
The S&P 500 Index closed down 10.24 points, or 0.14%, at 7,498.96.
The Dow Jones Industrial Average closed down 6.06 points, or 0.01%, at 52,218.58.
The Nasdaq Composite closed down 146.304 points, or 0.57%, at 25,690.903. The Nasdaq 100 Index declined 157.078 points, or 0.54%, to close at 28,998.101.
The Russell 2000 Index closed down 0.92% at 2,959.938.
The CBOE Volatility Index (VIX) closed down 2.05% at 16.70, declining steadily throughout the session.
U.S. stock sector ETFs:
Most U.S. equity sector ETFs closed lower, with the Internet Index ETF, Global Airlines ETF, and Biotechnology Index ETF falling as much as 1.86%. The Semiconductor ETF rose 0.48%, while the Energy Sector ETF gained 1.20%.
Mag 7:
The Wind U.S. Mag 7 Index declined by 0.48%.
NVIDIA rose 2.30%, while Apple fell 0.56%,$Amazon (AMZN.US)$down 1.09%, Tesla dropped 1.30%, and Google A fell 1.46%,$Microsoft (MSFT.US)$down 1.86%, and Meta declined 2.58%.
Semiconductor stocks:
$PHLX Semiconductor Index (.SOX.US)$closed up 54.501 points, or 0.44%, at 12,410.665 points.
Taiwan Semiconductor ADR fell 0.82%, while AMD rose 1.45%.
U.S.-listed Chinese stocks:
The Nasdaq Golden Dragon China Index closed down 1.80% at 6,180.98 points.
Among actively traded Chinese ADRs,$NetEase (NTES.US)$closed down 6.6%, Tencent fell 6%, with XPeng and Bilibili$KE Holdings (BEKE.US)$、 $Kingsoft Cloud (KC.US)$ fell by more than 3%, Ctrip dropped 2.5%, and Alibaba declined 1.4%,$Huazhu Group (HTHT.US)$、$CenturyLink (VNET.US)$、$Daquan New Energy (DQ.US)$rose by at least 1%.
Other stocks:
$Circle(CRCL.US)$fell by 6.87%.
$Super Micro Computer(SMCI.US)$surged nearly 20%. The company significantly raised its gross margin guidance for the fourth fiscal quarter, with new orders exceeding $60 billion during the period, and its order backlog reached a record high.
$Dell Technologies (DELL.US)$rose over 9%, marking its largest single-day gain since June 2.
$SpaceX (SPCX.US)$fell more than 6%, hitting a new all-time low since its listing.
AI application software stocks declined, with UiPath down over 11%, Reddit falling nearly 9%, Palantir and ServiceNow dropping more than 6%, and Salesforce down over 4%.
Other Corporate News
[Multiple overseas tech giants are ramping up data center investments; OpenAI has raised its cloud spending forecast to $750 billion.]
Multiple overseas tech giants are ramping up their data center operations. OpenAI plans to invest over $30 billion in building new data centers and has raised its cloud spending forecast to $750 billion. SpaceX is considering expanding its data center operations in Texas. Microsoft is further strengthening its AI presence in Europe, signing a 'multi-billion-dollar' data center partnership agreement with Mistral. Anthropic will begin purchasing up to 2 gigawatts of AMD's latest-generation chips in the first half of 2027.
【Qualcomm (QCOM.US)[Expanded collaboration with Samsung: Snapdragon will power the new Galaxy series, covering smartphones, watches, and smart glasses.]
Qualcomm and Samsung have expanded their collaboration, with Snapdragon providing support for the new Galaxy series across smartphones, watches, and smart glasses. Today, at Samsung Unpacked, Qualcomm Technologies announced that its Snapdragon 8 Elite Gen 5 Mobile Platform—alongside the Snapdragon Wear®™️ Elite Platform and the first-generation Snapdragon AR1—will power Samsung’s latest devices, including the Samsung Galaxy Z Fold8 Ultra, Samsung Galaxy Z Fold8, Samsung Galaxy Z Flip8, Samsung Galaxy Watch9, Samsung Galaxy Watch Ultra2®1, and new smart glasses.
European stocks closed up nearly 0.6%. Germany's stock market rose nearly 0.6%, defense ETFs gained approximately 1.8%, Italian banking stocks rose about 1%, and Danish equities fell roughly 2%.
Pan-European Equities:
The STOXX Europe 600 Index closed up 0.58% at 646.93 points.
The EURO STOXX 50 Index closed up 0.50% at 6,316.99 points.
National stock indices:
The DAX 30 Index closed up 0.58% at 25,155.41 points.
The CAC 40 Index closed up 0.89% at 8,437.89 points.
$FTSE 100 Index (.FTSE.GB)$Closed up 1.24% at 10,716.97 points.
Sector and individual stock performance:
Among eurozone blue-chip stocks, Airbus shares listed in Paris closed up 7.04%, Infineon rose 3.35%, Deutsche Telekom gained 2.06%, TotalEnergies advanced 2.03%, and Eni increased by 1.99%.
Among all constituents of the STOXX Europe 600 Index, Randstad rose 13.87%, Hiab gained 11.17%, CSG climbed 9.99%, Adecco Group advanced 9.13%, and Airbus ranked fifth, Nokia (NOK.US)down 2.34%.
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Editor/Liam