July 23rd Market Overview

Happy Thursday

Oil went back over $100 and Alphabet and Tesla earnings showed what the AI build out costs in actual cash.

Both landed the same morning, which is why the red looked worse than any single headline. Nothing broke today, the bill just came into clear view. Google said it’s spending $205 billion this year.

Let’s dig in...

Today's Big Picture

Oil is back above $100

Houthi militants said they hit two Saudi tankers near Bab al-Mandeb. Brent crossed $100 for the first time since May 26. Trump answered on Truth Social, promising to take out an Iranian bridge or power plant every time a ship gets hit in the Strait of Hormuz. Nannette Hechler-Fayd'herbe at Lombard Odier pointed out the pattern this year: once Brent touches $100, somebody starts de-escalating.

Cash flow is the new scoreboard

Alphabet $GOOGL and Tesla $TSLA both went free cash flow negative last quarter, and both got punished for it. Alphabet raised its 2026 spending plan to as much as $205 billion while Tesla runs past $25 billion. The seven biggest tech names lost roughly $888 billion in market value today, their worst day since April 2025. Revenue beats stopped paying the bill.

The Fed math got harder

Jobless claims came in at 187,000, the lowest reading since 1969. That is a genuinely strong labor market. Pair it with $100 oil and the case for a cut gets thin, which is why futures now lean hard toward a September hike. I'd rather have this problem than the alternative.

Market Overview

Index Performance

Stock spotlight

Lockheed Martin $LMT ( ▲ 11.02% )
booked a record $230 billion backlog, including a preliminary $35 billion order for THAAD interceptors. Management raised guidance on sales, earnings, and cash flow.

RTX $RTX ( ▲ 7.07% )  
did the same with a backlog near $289 billion. Finance chief Neil Mitchill said demand for missiles, sensors, and air defense batteries drove the raise.

Cleveland-Cliffs $CLF ( ▲ 17.88% )  
told investors the second half will be its best in five years. CEO Lourenco Goncalves said the steel tariffs survive the next election no matter who wins it.

Albertsons $ACI ( ▼ 21.88% )  
cut its outlook as shoppers went hunting for cheaper groceries. CEO Susan Morris said the company will eat fuel-driven cost increases instead of passing them along, which is good news for shoppers and rough on margins.

Big name updates

American Airlines $AAL ( ▼ 7.47% )  
now expects to break even for the year. Jet fuel added $2.2 billion in costs last quarter and management sees a $6 billion hit for the full year. Higher fares are covering about half of it.

Blackstone $BX ( ▲ 0.81% )  
earned $2 billion in distributable earnings, up from a year ago. Stephen Schwarzman said he is watching for excessive exuberance in AI and has been picky about where the money goes.

Alphabet $GOOGL ( ▼ 7.12% )  
disclosed that its SpaceX stake is worth $94.1 billion. That is roughly a six percent slice of a company that only went public in June.

T-Mobile $TMUS ( ▼ 7.78% )  
grew profit and revenue, but new account growth slowed. That is the number this stock trades on.

Other notable company news

Union Pacific $UNP ( ▲ 3.92% )  
posted stronger freight revenue as shippers moved cargo off trucks and onto rail. Canadian National dropped its opposition to the Norfolk Southern merger late Wednesday, clearing a real obstacle.

STMicroelectronics $STM ( ▼ 18.64% )  
guided third quarter revenue below expectations. A raised data center outlook above $1 billion did not save it.

Harley-Davidson $HOG ( ▼ 3.73% )  
lifted its full-year retail forecast on strong sales of its cheaper bikes. A $6,000 model arrives later this year.

Comcast $CMCSA ( ▼ 5.04% )  
got Peacock to profitability for the first time. Broadband and cable customers kept walking.

Uber $UBER ( ▼ 2.42% )  
cut ten percent of its customer service staff as part of a broader trim.

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Sector Watch

Bond Market

The 10-year Treasury yield hit its highest intraday level since January 2025. The 2-year moved right along with it, and that end of the curve is the one that tracks Fed policy.

Policy Watch

Fed

The Fed meets next week and the setup is messier than it looked a month ago. Cooler inflation made patience easy. Oil at $100 changed the conversation.

Ron Albahary at Laird Norton Wetherby is taking the other side of the hike trade. His argument is that a long conflict slows global growth through higher costs and disrupted trade, and that eventually calls for cuts. Worth keeping in your back pocket.

International

• The European Central Bank held its main rate at 2.25 percent and warned the inflation hit from energy has not fully landed. Traders expect a hike in September.

• European regulators fined Alphabet about $1 billion for favoring its own services, the first penalty under the bloc's new digital competition rules.

• Christine Lagarde shut down the resignation talk. She is staying until her term ends in 2027.

What to Watch

The AI company quietly automating every Walmart distribution center. 
23 billion in orders on the book.

It's just one of seven names in this free MarketBeat report.

Friday's earnings

American Express $AXP, Verizon $VZ, Charter $CHTR, HCA Healthcare $HCA, and Canadian National $CNI all report. American Express gives the cleanest read on whether the consumer is still spending.

Friday's data

June new home sales and the July flash activity readings land in the morning. Both tell you whether higher borrowing costs are actually biting demand.

Red Sea traffic

Ship tracker Kpler counted 43 crossings at Bab al-Mandeb on Wednesday, slightly more than Tuesday. Oil is pricing the threat, not an outage. If that count starts dropping, the price has room to run.

- John

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