The Week That Was

Reassuring corporate earnings, coupled with optimism over a possible Russia–Ukraine trade truce, pushed equity markets higher last week. The S&P 500 posted its best week since late June, up 2.4%, with consumer staples and technology leading gains. The Nasdaq rose 3.9%, driven by a 13.4% jump in Apple after it announced a $100 billion US investment, which could potentially secure it a tariff carve-out. European equities recovered most of their prior week’s losses, ending 2.1% higher, led by a strong banking sector. Bank of Ireland stood out, rising 10.4%.

Eurozone retail sales beat expectations in June, underscoring resilient consumer demand. The Bank of England cut its base rate by 25 bps to 4.0%, a two-year low, however, strong dissent among policymakers may cast doubts about further near-term cuts. In the US, services activity fell in July amid rising costs. The US 10-year Treasury yield eased to 4.3% after President Trump said he would nominate Stephen Miran, a chief proponent of the “Mar-a-Lago Accord” and a likely policy dove, to the Federal Reserve.

Oil fell sharply, with WTI down 5.1% on expectations that a trade truce could soften sanctions on Russian supply. Gold gained 1.0% on rising rate-cut expectations.

The Week Ahead

Tokyo markets were closed overnight for a holiday, while Hong Kong rose modestly on news China will be allowed access to advanced AI chips from AMD and Nvidia, with both firms agreeing to pay 15% of associated revenue to the US government.

This week, geopolitics will share the spotlight with the tail end of earnings season. In the US, John Deere, Alibaba and Cisco report, with Cisco’s update likely to shed light on IT spending and tariff impacts. Q2 blended US earnings growth stands at 11.8%, above the 10-year average of 6.9%, marking a third straight quarter of double-digit gains, led by Financials, Communication Services, Technology and Consumer Discretionary.

In Europe, Glanbia and Aviva are in focus, with the season so far delivering 6% earnings growth, driven by Financials. Key research team focus names include Diageo (OVERWEIGHT, PT: £23.70), Kingspan (OVERWEIGHT, PT: €88.00), and Flutter (OVERWEIGHT, PT: $330). On the geopolitical front, Tuesday may see a 90-day extension to the US–China tariff pause, while Friday’s Trump–Putin talks could signal progress towards resolving the Ukraine conflict.

Economically, July US inflation will be closely watched, with core CPI expected to edge up to 3.0% YoY as tariff pass-through remains limited. In Europe, the German ZEW Survey is likely to decline, indicating softer confidence. Thursday should confirm UK GDP slowed to 0.1% YoY in Q2, with Q1 boosted by pre-tariff demand. In the US, July retail sales (Friday) are expected to rise on strong auto demand and aggressive online promotions, alongside confirmation that consumer sentiment is at a six-month high.

Key Focal Points This Week:

• John Deere, Alibaba, Cisco, Glanbia, Aviva – Earnings updates
• Possible 90-day extension to US–China tariff pause
• Trump–Putin talks on Ukraine
• July US inflation data and core CPI release
• UK Q2 GDP figures
• US July retail sales and consumer sentiment data

We will continue to keep a close eye on market moves as earnings season progresses and trade policy decisions take shape. As always, please get in touch if you would like to discuss any of the above in more detail.

Written by John Mullane, CIO, Cantor Fitzgerald Ireland