Weekly Financial News — July 26, 2026

🌍 Dominant theme of the week

The week of July 20–26, 2026 was driven by a single storyline: the deepening conflict between the United States and Iran and its impact on oil. The memorandum of understanding signed between Washington and Tehran in late June — which had brought crude back to pre-crisis levels — has fallen apart: strikes resumed two weeks ago and have intensified. As a result, Brent climbed from around $90 at the start of the week to above $100 on Thursday, a symbolic threshold crossed for the first time since late May.

This oil surge rekindled inflation fears and triggered a genuine regime change in rates: markets now price rate hikes on both sides of the Atlantic in September, whereas just weeks ago they were still betting on cuts. The US 10-year Treasury yield rose above 4.70% for the first time since January 2025. On top of that came an intense earnings season, with several US mega-caps (Alphabet, Tesla) severely punished despite often solid numbers, amid persistent doubts about the return on massive AI investments.

📉 Weekly market performance

Europe held up better than Wall Street, where US indices posted their worst session since June 23 on Thursday (Dow -0.97%, S&P 500 -1.21%, Nasdaq-100 -1.87%) before a hesitant Friday. Within the CAC 40, the sector rotation was striking:

Energy (TotalEnergies lifted by Brent near $100) and aerospace-defence (Airbus) attracted flows, while semiconductors — struggling since the start of the month — luxury and retail were left behind.

🛢️ Commodities & Energy

Oil was the asset of the week: Brent jumped more than 8%, briefly crossing $100 on Thursday for the first time since late May before easing on Friday ($99.75 at Thursday’s close per Société Générale data). In the US, petrol prices climbed back above $4.00 per gallon. Gold played its safe-haven role above $4,050 per ounce. The driver is clear: geopolitical risk premiums on supply, with the Strait of Hormuz under severe strain.

🏦 Central banks

The ECB opted on Thursday, July 23 for a hawkish hold: its three key rates remain unchanged (refinancing 2.40%, deposit 2.25%, marginal lending 2.65%) after the 25-basis-point hike of June 11. Christine Lagarde did not, however, rule out another hike as early as September if the oil spike keeps feeding inflation expectations.

The Fed meets on July 28–29, with this week falling in the blackout period. Rates are expected to stay at 3.50–3.75%, but the CME FedWatch tool now assigns roughly a 35% probability to a hike — a remarkable shift when markets were recently still pricing a cut by year-end. The bond market is doing new chairman Kevin Warsh’s work for him: the curve is tightening and effectively “guiding” monetary policy toward restriction. The Bank of England and the Bank of Japan also meet next week, with no change expected.

📊 Macro data

In the United States, CPI inflation slowed to 3.5% (2.6% excluding food and energy), below consensus, but the rebound in crude threatens that respite; the economy remains on solid footing, allowing the Fed to focus on the inflation side of its mandate. In the euro area, inflation eased to 2.8% in June (from 3.2% in May), while industrial production fell 0.2% in May (-1.2% year-on-year). In China, second-quarter GDP disappointed at 4.3% (versus 5.0% the previous quarter): solid exports, but soft domestic demand. The US 10-year yield hit its highest level since early 2025 above 4.70%, with the 2-year around 4.1%.

🪙 Cryptocurrencies

Bitcoin is trading around $65,000, having cleared that level in mid-July (+8% in the week of July 18, market capitalization above $1.28 trillion). Ethereum trades near $1,911 and Solana near $77, in a market still close to multi-year lows.

Flows deteriorated late in the week: after nearly $1 billion of net inflows over seven straight sessions into US spot Bitcoin ETFs, investors withdrew $225 million on Thursday and $240 million on Friday, ending the positive streak. Cumulative flows since launch exceed $35 billion, with BlackRock’s IBIT accounting for nearly half. The flow-price correlation remains the key driver: roughly every $100 million of inflows translates into about a 0.5% same-day rise in Bitcoin. Institutional sentiment is rebuilding, but remains fragile.

💱 Currencies

EUR/USD slipped 0.51% over the week to 1.14, with the dollar benefiting from rising US yields and its geopolitical safe-haven status. GBP/USD held around 1.332 and USD/JPY around 163.8, the yen still very weak ahead of the Bank of Japan meeting. Société Générale’s technical analysts note that “the structure remains bearish” on EUR/USD.

📈 Investment themes & analysis

Earnings: the paradox of punished quality. About a quarter of S&P 500 companies have reported: 80% beat revenue estimates and 85% beat earnings estimates, with exceptional profit growth (+38%). Yet Alphabet fell 7.8% on the week despite better-than-expected results, punished for raising capex guidance again (~$15 billion more, negative operating cash flow) to fund AI data centres. Tesla plunged 17.8% after another miss (156x forward earnings). Intel (-2.9% despite its best revenue growth in 15 years and a +250% year-to-date run) and IBM (+0.7% after a pre-announcement that had cost it 25% in a single session, a record in its history) complete the picture. The market’s message: past results matter less than capital discipline and bond yields.

The “Chinese century” in portfolios. MoneyRadar devotes an in-depth analysis to China’s industrial dominance (over 60% of the world’s electric vehicles, ~90% of processed rare earths, more nuclear reactors under construction than the rest of the world combined) and highlights Tencent: around 12 times expected 2026 earnings (versus 18 for Meta and 26 for Alphabet), quarterly revenue up 9.1%, advertising +20%, free cash flow +20%, dividend raised — with the Pentagon’s 1260H list and the 2021–2022 regulatory crackdown as key risks.

US trading ideas. Humbled Trader sees rotation rather than flight (8 of 11 S&P 500 sectors green the prior week, a resilient Russell 2000, VIX at 18.77) and is watching Apple ($333.74, record highs ahead of July 30 earnings, boosted by Apple Intelligence’s approval in China), Marvell ($263.47) and Okta ($149.35) within the cybersecurity basket.

🧠 Editorial / Education

The Masterbourse letter offers a remarkable lesson on pricing power, summed up in one image: Chanel’s Classic bag went from €5,150 in 2019 to €10,300 in 2024 without losing desirability, while the pasta packet whose price soared is merely passing on costs. The real question is not “are prices rising?” but “what does the increase cost the company, and what would leaving cost the customer?”. The richest seam often lies with invisible suppliers: Robertet (fragrances represent only ~5% of a perfume’s cost), LISI (aerospace fasteners costing a few euros each on aircraft carrying hundreds of thousands), SEMCO Technologies (critical components requiring up to two years of requalification to switch suppliers). As Warren Buffett put it: “The single most important decision in evaluating a business is pricing power.”

🔭 Observed trends

Three shifts are confirming themselves versus previous weeks. First, the rate regime has flipped: in three weeks, markets moved from pricing cuts to pricing September hikes on both sides of the Atlantic — the bond vigilantes are setting the tempo. Second, sector rotation is broadening: semiconductors, the stars of the first half, have underperformed since early July in favour of energy, financials and defensives; the question of AI return on investment is now being put squarely to the hyperscalers. Third, the geopolitical premium is settling in: barring a diplomatic breakthrough between Washington and Tehran, volatility should persist through the summer, with durably expensive oil complicating central banks’ task. The coming week will be a major test: Fed, BoE and BoJ meetings, preliminary July inflation in the euro area, and earnings from four of the “Magnificent 7”.

⚠️ Disclaimer

This content is provided for informational purposes only and does not constitute investment advice. Past performance does not guarantee future results. Consult a qualified financial adviser before making any investment decision.