Market Review: July 07, 2026

Closing Recap

Tuesday, July 07, 2026

U.S. stocks end the day lower, with the Dow Jones Industrial Average pulling back from record levels as investors again rotated out of names tied to artificial intelligence while oil prices advanced along with Treasury yields. Most of today’s weakness was in technology, pressuring markets (especially semis), as markets faded this afternoon on geopolitical headlines with Iran. While the AI/tech/semi/data center/power trade was crushed early today, after tumbling late last week off all-time highs for many names, Wall Street investors rotated out of those sectors and into just about everything else this morning, with more than 2% gains early for Healthcare (XLV), Utilities (XLU), Consumer Staples (XLP) and Energy (XLE), before paring gains. No Fed speakers today but attention will be on the FOMC minutes out tomorrow given the quickly changing expectations around the Fed’s path going forward. In a week relatively light on economic indicators, markets await Fed minutes tomorrow. Earnigns also is just around the corner with a few names this week but picks up next week with banks.

• The U.S. trade deficit widens 42.2% in May, to $77.6 billion (highest level in 14 months) from April’s revised $54.6 billion. Imports increase 3.3% to $395.3 billion; exports drop 3.2% to $317.7 billion and Goods trade deficit rises 28.4% to $106.5 billion, highest level since March 2025.

• August gold settles -$10.10/oz, or -0.24%, at $4,157.40 while September silver prices fell -$1.00 or 1.6% to settle at $61.33 an ounce. Precious metal futures extended losses late day after the spike in oil prices hit the market.
• U.S. Treasury yields advanced as investors monitored geopolitical tensions after attacks in and around the Strait of Hormuz drove oil prices higher, while bracing for a heavy slate of auctions expected to gauge appetite for U.S. government debt. Late day, prices hit their highest levels as the 10-yr rose over 5 bps to 4.53%, fresh 4-week highs and the 30-yr +5bps to 5.04%.

• Travel & Lodging: shares of airlines AAL, DAL, UAL, JBLU, LUV declined along with cruise lines CCL, RCL, NCLH, VIK after oil prices rose after reports of attacks on vessels near the Strait of Hormuz revived fears of disruptions to shipping. Fuel costs for U.S. airlines jumped 85% in May to nearly $6.7 billion as the Middle East conflict drove ‌up prices

• In Solar: FSLR was upgraded to Buy from Hold at Deutsche Bank with a $272 price target as remains one of the fundamentally strong business for investors looking for a US based panel production company along with a strong balance sheet (net cash of $2.1B as of Q2).
• In Utilities: The EIA said it expects U.S. electricity demand to reach new record highs in 2026 and 2027, driven by AI data centers, crypto operations, and electrification. Commercial electricity use is projected to exceed residential demand for the first time.

• Mortgage Finance: Barclays downgraded PFSI to Equal Weight from Overweight (tgt to $93 from $107), citing a lower ROE outlook. The firm lowered its origination estimates and trimmed EPS estimates for the originators to reflect an elevated 30-year fixed-rate mortgage and a softer spring selling season. Continue to favor FAF, RKT, and UWMC
• Crypto sector: BLSH reports June total trading volume $50.9B as metrics include trading volume, average trading spread, and measures of volatility for Bitcoin and Ethereum. GEMI launched stock trading with 0% commissions for customers in the U.S., the company said Tuesday, putting the crypto platform in competition with the likes of HOOD and COIN.
• In Banks: TFC was downgraded from Buy to Neutral at UBS saying while shares have lagged peers this year, the recently announced CEO change and the prospect of rate hikes in the forward curve Cloud near-term visibility on the leadership roster, talent retention, near-term EPS power, and recently introduced medium-term targets. UBS also assumed coverage with Buy ratings on FLG, ONB, VLY in Midcap banks and Neutral ratings on WTFC, SSB while saying BPOP, FLG are top picks.
• In Exchanges: CBOE said total options activity reached a quarterly average daily volume of 21.9M contracts and a monthly ADV of 23M, including a June 5 single-day record of 33.4M contracts. Multi-listed and index options average daily volume rose 41% and 37%, respectively, from a year earlier. Proprietary index options posted records across measures, including an overall quarterly ADV of 6.2M
• Financial Services: EFX announces definitive agreement to acquire Círculo De Crédito in Mexico for a purchase price of $825M as the deal expected to be accretive to Equifax adj EPS in first full year.
• FinTech: FISV shares rise after the WSJ reported big banks have held talks about a potential deal to acquire a network owned by the financial technology company that could allow the lenders to bypass federal debit-card fee caps https://tinyurl.com/55y2jjp8  

• COMP said its investigational psilocybin treatment had lasting benefits on patients with severe depression out to six months; had previously reported that 39% of patients who took two high doses in a Phase 3 trial achieved what Compass called a “clinically meaningful reduction” on a depression rating scale after six weeks.
• CRNX agreed to be acquired by VRTX for $85 per share in $10B deal. Vertex plans to finance the deal using cash on hand and debt, supported by $4.5B in committed Bridge financing.
• LLY shares advanced to record intraday high of $1,249.75 before paring gains.
• MGTX said it secured up to $400M from Oberland Capital to advance three late-stage experimental gene therapies; funding includes up to $375M in non-dilutive financing tied to future sales royalties and up to $25M in equity investment
• RGEN was upgraded to Buy from Hold at Benchmark with a $185 price target, citing improved quarterly financial performance as well as increased valuations for comparable bioprocessing stocks.
• VERA said the FDA approved its kidney disease drug Trutakna, a self-administered injectable treatment approved for patients with immunoglobulin A nephropathy, also known as Berger’s disease.

• RXST announced a non-exclusive license agreement for the development + commercialization of post-operative light adjustable PCIOL technologies saying it will receive a $60M upfront payment and potentially a additional $140M in payments; also guides Q2 revs $32M-$34M vs. est. $32M.
• Managed Care: Cantor with several price tgt changes in Q2 preview as CNC Raise PT to $75 from $60, CVS to $110 from $100, ELV to $450 from $400, HUM to $300 from $264) & HCA lowered to $525 from $588, as well as estimates for ACHC. Cantor prefers exposure to payors over providers into Q226 earnings season as management calls, proprietary checks (enrollment, volume survey, labor), & investor conversations have driven this view. Cantor’s payor picks are CNC .

• In Homebuilding: Zelman & Associates upgrades DHI to Outperform and NVR to Buy, while simultaneously downgrading CCS to Underperform and cutting MHO and MTH to Neutral in a sweeping homebuilder ratings reshuffle
• Industrial Distributors: DA Davidson said June checks provide a generally positive read for the industrial distributor group as volume growth ticks higher and pricing contribution holds steady vs May. The firm continues to favor shares of MSM (B, PT $150) and WCC (B, PT $440), while it sees some Tactical opportunity for GWW (N, PT $1,250) into Q226 earnings, while FAST (N, PT $46) continues to face elevated consensus margin expectations, presenting incremental risk.
• Aerospace: Wall Street initiated coverage of SPCX today after it was added to the Nasdaq 100 index last night as Nasdaq tweaked its rules to fast-track its inclusion because AI companies have become crucial to the broader market. Top rating and tgt went to Raymond James with a Strong Buy and $800 tgt, along Overweight/Buy ratings from Morgan Stanley ($300 tgt), Cantor ($246 tgt), Deutsche Bank ($255 tgt), JPM ($225 tgt), Macquarie ($250 tgt), Bank America ($235 tgt), Bernstein ($239 tgt), Needham ($200 tgt), Stifel ($190 tgt) and UBS ($210 tgt).

• NVDA shares fell after Reuters reported Chinese startup DeepSeek is developing its own AI chip, according to three people familiar with the matter, a push that could reduce its reliance on Nvidia and Huawei chips, which it has depended on to train and run its globally popular models. The chip is designed for inference rather than for training new models.
• Coming into today, memory stocks and semis in general have fallen notably from record highs after a massive 2-year run as WDC was -33% from all-time highs, SNDK -30% from ATH’s, STX -29% from ATH’s, MU -26% from ATH’s, INTC -18% from ATH’s and DELL -15% from ATH’s. MU shares fell as investors grew concerned that Samsung Electronics and SK Hynix’s aggressive capital spending plans could eventually create a memory supply glut and pressure pricing.
• Samsung’s local peer SK Hynix has kicked off the process for a U.S. listing, looking to raise $28 billion in fresh capital when it lists American depositary receipts Friday.
• Hyperscalers/AI Data Centers: AMZN launched an eight-part U.S. investment-grade bond sale expected to price today, as the deal spans 2029 to 2066 maturities. WULF tgt raised to $33 from $28 at Needham arguing the company’s 20-year, 401 MW lease with Anthropic establishes sector-leading economics at $2.37M per IT MW annually—the highest top-line rate in its HPC mining coverage. META plans to release Muse which is its first in-house AI image generation model. Meta also plans to replace third-party image models with its own proprietary image technology.

• IT Services & Consulting: NET was upgraded to Outperform from Sector Perform at Scotia and raised its price target to $300 from $225, arguing the company’s AI and enterprise execution warrant owning the stock. The firm sees Cloudflare increasingly winning leading AI-native customers while recent CIO/CISO channel checks point to strengthening traction in SASE and edge compute.
• Software movers; the sector benefitted from a rotation out of semis and into the sector with shares of NOW, TEAM, HUBS, SNOW, WDAY, TWLO all outperform in tech; Bank America reinstated ADBE with Underperform and $190 PT as Ai lowers barriers to creation and pressures Adobe’s moat and sees Adobe’s Ai strategy as largely defensive, supporting retention but unlikely to drive meaningful ARR growth. MSFT, looking to reduce AI costs, is starting to replace OpenAI and Anthropic with its own models in software products like Excel and Outlook, Bloomberg reported.