Morning Wrap: ASX 200 to fall, S&P 500 higher as Amazon surges, Trump halts Iran strikes

In a nutshell:

• Major US benchmarks mostly higher to cap a volatile July, with Amazon's biggest one-day gain in more than a decade offsetting a slump in Apple and another push higher in long-end Treasury yields

• Trump said late Saturday he had cancelled a planned strike on Iran after being told the "perimeters" of a deal to reopen the Strait of Hormuz had been agreed, though Tehran denies asking for the pause

• Tokyo and Washington conducted their first joint yen intervention since 2011, with Finance Minister Satsuki Katayama due to confirm the operation on Monday and the BOJ signalling a September hikeLet's dive in.

• Major US benchmarks finished higher and near session highs after veering between gains and losses in early trade

• Breadth was negative, with seven sectors trading lower and the Equal-weight S&P 500 (-0.17%) underperforming the cap-weighted index by 87 bps

• US 30-year yield up 5 bps to 5.26%, a third straight multi-year high and the 10-year hit 4.71%, the highest since Jan-25, adding pressure on equities through the session

• US weekly recap: Nasdaq (+1.59%), S&P 500 (+1.05%), Dow (+1.04%), Russell 2000 (+0.05%)

• US monthly recap: Dow (+0.32%), S&P 500 (-0.13%), Russell 2000 (-3.08%), Nasdaq (-3.20%)

• Citadel deal with Situational Awareness helps trigger relief rally in global AI stocks (BBG)

• South Korean chip giants SK Hynix (+29.9%) and Samsung (+26.8%) surge after Amazon and Microsoft earnings revive AI optimism (CNBC)

• Microsoft sees record daily gain following earnings, adding US$450bn to its market cap on Thursday (RT)

• Yen experiences biggest intrasession rise against dollar since Dec-2023 (BBG)

• South Korea and Japan authorities coordinated intervention, possibly with support from US in rare occurrence (RT)

• Currency traders are on high alert for further joint Japan and US intervention when Asia opens Monday, with the MOF and Treasury coordinating to a degree unseen in decades (BBG)

• Amazon, Microsoft, Meta and Alphabet, have now guided to combined 2026 capital spending of $720bn to $745bn (YF)

• Amazon Q2 2026 revenue up 20% to $200.6bn, AWS up 37% to $42.2bn in its fastest growth in 18 quarters, operating income up 43% to $27.5bn, 2026 cash capex guidance lifted to about $220bn from $200bn, shares up 15.3% in their best session in over a decade (CNBC)

• Apple Q3 FY26 revenue up 16% to a June-quarter record $109.4bn, iPhone up 22% to $54.3bn, EPS $2.02 beat ests by about 7%, September-quarter guidance of 9-11% growth missed the 12% ests on memory costs and advanced-node supply, shares down 7.3% (BBG)

• Chevron Q2 2026 adjusted EPS $6.06 beat ests by about 9%,  downstream earnings jumped to $4.9bn from $737m and record US output hit 2.07m barrels a day, delivering its highest quarterly profit on record at $12.1bn (YF)

• ExxonMobil Q2 2026 adjusted EPS $3.52 missed ests by about 2%, revenue $116bn against $97.8bn ests, refining earnings swung to $5.5bn from a $1.3bn first-quarter loss, profit more than doubled to $14.5bn and shares slipped 0.9% (CNBC)

• Reddit Q2 2026 revenue up 61% to $805m, EPS $1.25 beat ests by about 32%, third-quarter revenue guided above ests at $860m to $870m, shares still fell 20% after CEO Steve Huffman said Google search referrals were "choppy" (TS) 

• Trump said he agreed to cancel a planned strike on Iran "subject to being able to rapidly make a DEAL" after Tehran and other Middle Eastern powers said they were working on an agreement to reopen the Strait of Hormuz (BBG)

• Trump said the emerging deal would include the immediate, complete and total opening of the Strait of Hormuz and an end to Iran's nuclear threat, adding that Israel joined him in the commitment (AP)

• Iran denied asking the US to refrain from new strikes, with military officials calling the claim "nothing but a new lie" and saying the armed forces remain on high alert (AJ)

• Iranian outlet Nournews warned that US attacks on Iranian energy infrastructure would trigger strikes on Saudi and UAE oilfields and Qatari and Israeli gasfields (AJ)

• OPEC+ approves a ~188Mbpd output increase from September, completing its rollback of 2023's voluntary production cuts (CNBC)

• Democratic senators demanded information on more than a dozen critical mineral deals worth over $8.9bn in federal funding involving companies with financial ties to the Trump or Lutnick families (CNBC)

• Cleveland Fed Hammack said inflation has stayed above 2% for more than five years and she is not confident it will return on its own, calling for the FOMC to act now (RT)

• Minneapolis Fed Kashkari said a potential series of small policy moves would be better than waiting and eventually concluding that bolder action was necessary (YF)

• Dallas Fed Logan said current rates are not sufficiently restrictive and that, barring an unanticipated shock, inflation is likely to keep running above target (CNN)

• Bank of Japan kept rates at 1.0% by an 8 to 1 vote, stressing its readiness to keep raising borrowing costs to forestall mounting inflation risks (RT)

• BOJ board member Hajime Takata dissented in favour of an immediate hike to 1.25%, arguing the bank should prepare for upside inflation risks (CNBC)

• US consumer sentiment for July rose to 55.2 from 49.5, a five-month high and up almost 12% month-on-month, with one-year inflation expectations holding at 4.2% (BBG)

• Eurozone inflation accelerated to 2.9% year-on-year in July from 2.8%, with energy inflation jumping to 10.0% from 8.5% and core rising to 2.5% from 2.4% (BBG)

• China's manufacturing PMI fell to 49.2 in July from 50.3, missing 50.0 ests and marking the first contraction since February on slumping domestic orders and typhoon disruption (CNBC)

• China's non-manufacturing PMI dropped to 49.0 from 50.2, with construction activity slumping to a record low 47.0 and the composite falling to 49.3, its weakest since 2022 (XH)

• Kelly Partners Group Holdings holder Kelly Investments 1 discloses the disposal of 2.8m shares, taking its relevant interest to 31.0% from 37.2%, change to shares released from funding arrangements priced earlier under a loan agreement, with a right to recover the stock at the end of the loan period (KPG)

• Pinnacle Investment Management Group weighing a bid for Bennelong Funds Management, considering both a full takeover and a break-up of the business across its existing affiliates (AFR)

• ResMed hit with an FDA Class I recall (the most serious category) covering a subset of Astral 100 and Astral 150 ventilators, where a leaking supercapacitor may damage the circuit board and send the device into a fail-safe state. Devices are corrected in place rather than withdrawn, and the affected products are unchanged from the earlier alert (RMD)

• Vista Group International lifts FY26 revenue guidance to $179-184m from $176-182m after 1H26 revenue of $86.3m rose 12%, EBITDA $12.4m up 24% and ARR $170.1m up 17%. Contracted enterprise market share expands to 48% from 46% on the return of Cinemex's 312 sites (VGL)

• Westpac Banking completes the previously announced sale of its RAMS mortgage portfolio, ~$15.4bn at completion, to a consortium of Pepper Money, credit funds and accounts managed by KKR, and PIMCO managed funds (WBC)

• A big TACO: Trump said the US is holding off another Iran attack as they're working on a deal that might quickly reopen the Strait. Very tentative and speculative stuff, but Brent is down ~8% this morning to ~US$83, gold up ~0.7% to US$4,072/oz (recouping some of last Friday's 1.5% dip) and copper is looking very strong, up 0.8% to US$6.61/lb and within 1.5% of the 2-Jun record high.

• Reporting season: Here. We. Go. The first week of reporting season is always quiet (namely Pinnacle, AMP, REA Group, Block, Resmed and Nick Scali results). We've got an epic reporting season calendar that features consensus earnings and dividend expectations.

• Fortescue upgraded to Hold from Sell; target lowered to $17.40 from $18.15 (Bell Potter)

Stocks trading ex-dividend: 

• Mon 3 Aug: La Trobe Private Credit Fund (LF1) – $0.013, Pengana Global Private Credit Trust (PCX) – $0.013, Premier Investments (PMV) – $0.45

• Tue 4 Aug: Australian Foundation Investment Company (AFI) – $0.17, Clearview Wealth (CVW) – $0.05

• Wed 5 Aug: Djerriwarrh Investments (DJW) – $0.043

• Thu 6 Aug: None

Other ASX corporate actions today:       

• Dividends paid: None

• Earnings: Kelly Partners (KPG)

• IPOs: None

• AGMs: None

Economic calendar (AEST):

• 11:00 am: Australia TD-MI Inflation Gauge

• 11:45 am: China RatingDog Manufacturing PMI

• 12:00 am: US ISM Manufacturing PMI