Stocks Supported as Bond Yields Slide on Weak CPI Report

The S&P 500 Index ($SPX) (SPY) today is up +0.38%, the Dow Jones Industrial Average ($DOWI) (DIA) is up +0.07%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up +0.97%.  September E-mini S&P futures (ESU26) are up +0.30%, and September E-mini Nasdaq futures (NQU26) are up +0.97%. 

Stock indexes are moving higher today as bond yields fell on a better-than-expected US June CPI report.  The 10-year T-note yield is down -5 bp to 4.57%.  Also, upbeat comments from Fed Chair Warsh were supportive of stocks when he said the US economy is resilient, growing at a solid pace, and that the labor market is broadly stable. 

Semiconductor stocks are climbing today, recovering some of Monday’s losses as South Korea’s Kospi Index closed up +0.73% after SK Hynix and Samsung Electronics rebounded.  Also, US bank stocks are rising after Goldman Sachs, JPMorgan Chase, Bank of America and Citigroup reported better-than-expected Q2 earnings. However, software stocks are taking a hit today, led by a -24% plunge in IBM after it reported preliminary Q2 revenue that fell short of consensus. 

US Jun CPI eased to +3.5% y/y from +4.2% y/y in May, better than the +3.8% y/y expected.  Also, Jun core CPI eased to +2.6% y/y from +2.9% y/y in May, better than expectations of +2.8% y/y.

Fed Chair Warsh said the US economy is resilient, growing at a solid pace, and that the labor market is broadly stable and nominal wage growth is solid.  He added that the Fed has "no tolerance" for persistently high inflation.

Better-than-expected Chinese trade data is supportive of global economic growth prospects after China's Jun exports rose +27.0% y/y, beating expectations of +19.0% y/y.  Also, Jun imports rose +36.0% y/y, stronger than expectations of +26.1% y/y and the biggest increase in 5 years.

On the negative side, WTI crude oil (CLQ26) is up more than +1% at a 1-month high, adding to Monday’s +9% surge, as the interim peace deal between the US and Iran effectively collapsed.  The US reimposed a naval blockade and launched another wave of airstrikes today against Iran, while Iran attacked more oil tankers in Omani waters that were transiting the southern route of the Strait of Hormuz. 

President Trump said Monday that the Strait of Hormuz will remain open "with or without Iran" and that the US would be the waterway’s “guardian,” demanding to be reimbursed at a rate of 20% of all cargo shipped for providing protection in the area, although he has not provided details on how this could be implemented.  The reinstatement of the blockade on Iranian ports may prompt Iran to step up attacks on ships seeking to transit the Strait of Hormuz. 

The outlook for strong Q2 earnings, which will begin this 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. 

The markets are discounting a 12% 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 -0.02%.  China's Shanghai Composite recovered from a 3.5-month low and closed up +1.36%.  Japan's Nikkei-225 Stock Average rebounded from a 1-month low and closed up +0.74%.

Interest Rates

September 10-year T-notes (ZNU6) today are up +11 ticks, and the 10-year T-note yield is down -5.6 bp to 4.567%.  Sep T-notes recovered from a 1.75-month low today and moved higher, and the 10-year T-note yield fell from a 1.75-month high of 4.634%. T-notes rallied today on a smaller-than-expected increase in June US consumer prices.  Also, comments today from Fed Chair Warsh were bullish for T-notes when he said the Fed has "no tolerance" for persistently high inflation.  T-notes initially moved lower today amid stronger crude oil prices as WTI crude is up more than +1% at a 1-month high. 

European government bond yields are mixed today.  The 10-year German bund yield climbed to a 1.75-month high of 3.144% and is up +0.3 bp to 3.112%.  The 10-year UK gilt yield fell from a 1.75-month high of 5.048% and is down -0.1 bp to 4.968%.

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

US Stock Movers

Chipmakers and AI-infrastructure stocks are rebounding today, recovering some of Monday’s selloff.   The iShares Semiconductor ETF (SOXX) is up more than +2%.  Lam Research (LRCX), KLA Corp (KLAC), and Microchip Technology (MCHP) are up more than +3%, and Advanced Micro Devices (AMD), Applied Materials (AMAT), Micron Technology (MU), Sandisk (SNDK), NXP Semiconductors (NXPI), ASML Holding NV (ASML), Analog Devices (ADI), Broadcom (AVGO), Marvel Technology (MRVL), Western Digital (WDC), and Texas Instruments (TXN) are up more than +2%. 

Cybersecurity stocks are moving higher today.  CrowdStrike Holdings (CRWD) is up more than +9% to lead gainers in the S&P 500 and Nasdaq 100, and Okta (OKTA) is also up more than +9%.  Also, Zscaler (ZS) is up more than +8%, and Palo Alto Networks (PANW) is up more than +5%.  In addition, Cloudflare (NET) is up more than +4%, and Fortinet (FTNT) is up more than +3%.

Mining stocks are rallying today with gold, silver, and copper prices up sharply.  Southern Copper (SCCO) is up more than +4%, and Coeur Mining (CDE), Freeport McMoran (FCX), Newmont Corp (NEM), and Hecla Mining (HL) are up more than +3%.  Also, Anglogold Ashanti (AU) and Barrick Mining (B) are up more than +2%.

Software stocks are moving lower today, led by a -24% plunge in International Business Machines (IBM) after it reported preliminary Q2 revenue that fell short of consensus.  Also, Atlassian Corp (TEAM) is down more than -5%, and Workday (WDAY) is down more than -4%.  In addition, ServiceNow (NOW) andAdobe Systems (ADBE) are down more than -3%, and Intuit (INTU) and Thomson Reuters (TRI) are down more than -2%.  Finally, Salesforce (CRM), Autodesk (ADSK), and Microsoft (MSFT) are down more than -1%. 

Goldman Sachs Group (GS) is up more than +7% to lead gainers in the Dow Jones Industrials after reporting Q2 equities and trading revenue of $7.42 billion, well above the consensus of $5.02 billion.

O-I Glass (OI) is down more than -8% after Bank of America Global Research double-downgraded the stock to underperform from buy with a price target of $11. 

CoStar Group (CSGP) is down more than 5% after announcing a management change: Robin Rossman will replace Christian Lown as CFO, effective July 31. 

Earnings Reports(7/14/2026)

Bank of America Corp (BAC), Citigroup Inc (C), Fastenal Co (FAST), Goldman Sachs Group Inc/The (GS), JPMorgan Chase & Co (JPM), Liberty Live Holdings Inc (LLYVA), Wells Fargo & Co (WFC).