U.S. Markets
U.S. equities remain firmly bullish, with the S&P 500 hitting a fresh all-time high of $7,816 yesterday. The index is trading around $7,800 in early trading today. Tech and communication services led gains, while the Nasdaq and S&P 500 remain on track for a third consecutive weekly advance.
The rally continues to be driven by renewed strength in AI and growth stocks, supported by softer inflation data. A weaker-than-expected PPI following Wednesday’s in-line CPI has reinforced expectations that inflation remains contained, allowing investors to rotate back into higher-growth names. Software has also staged a strong recovery, with IGV up around 30% since April 2026. Corporate earnings remain a key support, with over 90% of S&P 500 companies having reported Q2 results and earnings growth tracking around 50% YoY. Oil prices are easing after OPEC lowered its demand forecast, reducing concerns over an energy shortage and potentially easing pressure from disruptions around the Strait of Hormuz. Lower energy prices could further support risk sentiment.
While some risks remain around AI valuations and Nvidia’s proposed $500 billion AI infrastructure funding initiative, with concerns that excessive capital deployment could eventually create excess compute capacity, the S&P 500’s strong earnings growth, improving breadth and continued AI-led momentum continue to support the broader bullish trend. Investors now turn to July retail sales, expected to rise 0.1% MoM, for further clues on consumer strength. Overall, the near-term bias remains bullish, supported by earnings, softer inflation and easing oil prices.
Technically, the index is trading near all-time highs and above all key moving averages. Resistance may be seen around $7,840, followed by $7,900. Support lies at $7,750, followed by $7,700, making this an attractive zone for long entries on any pullback.
Gold & Silver
Gold and silver are trading lower today, with gold down 0.39% at $4,334 and silver declining 0.36% to $64.24 at the time of writing. The pullback marks a second consecutive day of declines, as investors take profits following gold’s recent rally to a 10-week high.
The retreat comes despite a supportive inflation backdrop. US consumer prices barely increased in July, while producer prices were unchanged, helping ease concerns that the Federal Reserve may need to tighten policy further. Traders are now pricing only a 35% chance of a September rate hike, down from around 55% last week, providing a more favourable backdrop for non-yielding assets such as gold.
However, much of the positive news from softer inflation appears to have already been priced into the recent rally. Gold had climbed above its 100-day moving average for the first time since April before slipping back below it, suggesting that near-term momentum may be fading and consolidation could continue. Elevated interest rates for an extended period could also limit upside by keeping bonds relatively attractive.
On the daily chart, gold continues to consolidate within a bull flag formation, keeping the broader bullish structure intact. The key level to watch is the psychological resistance at 4,400. A sustained break above this barrier could trigger the next leg higher toward 4,450. On the downside, the 8-day EMA at 4,310 remains crucial support after successfully cushioning prices today. Silver is displaying a similar consolidation pattern within a broader uptrend. The metal needs to clear resistance at 65.40 to confirm a bullish breakout, which could pave the way for a move toward this week’s high at 66.80. On the downside, the 8-day EMA at 63.56 continues to provide key support.
Crude Oil
Brent crude advanced 0.8% to $90.20/bbl while WTI rose by 1.1% to $82.13/bbl.
The oil market is sending mixed signals, with ample crude inventories masking growing stress in refined products. Last week’s 17.4-million-barrel increase in U.S. commercial crude stocks, driven by stronger imports and weaker exports, helped pressure WTI lower. While ongoing tensions in the Middle East and uncertainty around the Strait of Hormuz continue to provide a geopolitical floor for prices, traders are increasingly focused on actual physical flows rather than geopolitical rhetoric.
The more important story for markets lies downstream. U.S. gasoline inventories are at their lowest seasonal level since 2012, and distillate stocks remain below normal. Refining outages in Russia, across the Middle East and an estimated 10% of global refining capacity offline have shifted the bottleneck in the market from crude supply to refined products, keeping crack spreads elevated and resulting in ongoing increases in retail fuel prices despite relatively contained crude prices. The Brent curve remains strongly backwardated, indicating a tight prompt market and ongoing inventory draw.
Brent maintains higher momentum as prices defend the $88.7-$89.0/bbl support zone and reclaim $90/bbl. Buyers remain firmly in control of the near-term trend as prices approach the key $91.4-$92.8/bbl resistance area, with the trend bias remaining bullish as long as $87.7/bbl holds as support.
WTI rebounded from $81.0/bbl support zone and is maintaining a higher-low formation on the 4-hour chart. Upside momentum, however, is limited at $82.7-$83.0/bbl. A candle close above this level will confirm continuation of the bullish wave, targeting $83.5-$84.0/bbl. Otherwise, prices may be corrected toward the support zone again due to ranging in a defined channel.
U.S. Dollar Index
The dollar index pulled back 0.15% to around 99.4 on Friday, as subdued US inflation data prompted traders to dial back expectations for a Federal Reserve rate hike in September.
Data released Thursday showed US producer prices were unchanged in July, providing further evidence that price pressures are not broadly accelerating following Wednesday’s tame CPI report. Markets are now pricing in around a 34% chance of a 25-basis-point rate hike in September, down from 44% a week earlier.
The latest figures also suggest that the initial inflationary impact of the Middle East conflict and higher energy costs may be fading. However, uncertainty over a potential deal to end the war and reopen the Strait of Hormuz continues to pose risks to the inflation outlook.
USD/JPY is modestly lower after another media report that the Bank of Japan is eyeing an early tightening, with September a possibility. However, FX traders are skeptical and not pushing too hard to sell dollars.
Technically, the dollar index is trading at 99.9, below the 9 and 21 EMAs on the daily chart. However, prices are still above the 200 EMA on the daily chart, maintaining the bullish bias of the greenback. On the 4-hour chart, immediate support is at the trendline level of 99.2. A break below this level can turn into a bearish move in the dollar and send it to the 98.7 level. Resistance is at the 99.7 level. A break above this level can add to the bullish bias of the dollar and push it to the 100 level.
