Stocks Fall as Caution Builds Ahead of Alphabet: Markets Wrap
(Bloomberg) — Stocks fell ahead of Alphabet Inc.’s earnings as traders waited for the clearest read yet on whether the vast sums technology hyperscalers are pouring into artificial intelligence are paying off.
A two-day rebound in the Nasdaq 100 came to a halt, with index futures dropping 0.8%. South Korea’s Kospi Index and other tech-heavy gauges in Asia trimmed strong early-session gains. The technology sector lagged sharply in Europe’s Stoxx 600.
Higher crude prices also kept a lid on sentiment after both the US and Iran signaled they were in no rush to restart talks following an escalation in their conflict in the Middle East. Brent rose 3.5% to above $94 a barrel, extending its surge to nearly 30% in July after hostilities resumed.
After Alphabet said last quarter that it plans to more than double capital spending from 2025 to as much as $190 billion this year, investors will be watching closely for evidence that those investments are generating returns. Yet the companies building the global AI infrastructure need that spending growth to continue to justify their stellar share-price gains.
The earnings report will come just as market-leading chipmakers have been gripped by intense volatility amid fears that the current pace of AI spending cannot be sustained.
“Expectations for the results of hyperscalers are high and investors need to be mindful of the risk that the shares could fall even if earnings beat market forecasts,” said Hiroshi Namioka, chief strategist at T&D Asset Management.
Meanwhile, people familiar with the matter said Bank of Japan officials are open to raising interest rates at a faster pace than the consensus among economists, with the yen’s continued weakness adding to upside inflation risks. The currency outperformed most major peers following the news.
Corporate News:
Super Micro Computer Inc. shares rose about 15% in extended trading after the server maker issued preliminary results saying its backlog hit a record on new orders in the quarter of more than $60 billion. Cathay Pacific Airways Ltd. expects a jump in first-half net income, driven by strong passenger and cargo demand. Banco Santander SA posted second-quarter net income that beat analyst estimates as it continued to add millions of customers. Equinor ASA said second-quarter earnings exceeded expectations as higher natural gas prices in Europe and a boost to its oil trading business from the Iran war drove up profit. Some of the main moves in markets:
Stocks
The Stoxx Europe 600 fell 0.2% as of 8:36 a.m. London time S&P 500 futures fell 0.4% Nasdaq 100 futures fell 0.8% Futures on the Dow Jones Industrial Average fell 0.2% The MSCI Asia Pacific Index rose 0.1% The MSCI Emerging Markets Index was little changed Currencies
The Bloomberg Dollar Spot Index was little changed The euro rose 0.1% to $1.1415 The Japanese yen rose 0.1% to 162.95 per dollar The offshore yuan was little changed at 6.7731 per dollar The British pound was little changed at $1.3388 Cryptocurrencies
Bitcoin fell 0.9% to $65,788.7 Ether fell 0.4% to $1,914.05 Bonds
The yield on 10-year Treasuries was little changed at 4.64% Germany’s 10-year yield advanced two basis points to 3.18% Britain’s 10-year yield advanced one basis point to 5.04% Commodities
Brent crude rose 3.4% to $94.11 a barrel Spot gold rose 1% to $4,117.76 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Neil Campling.
©2026 Bloomberg L.P.
