NEW YORK, July 31, 2026, 16:03 EDT
- The S&P 500 advanced 0.70% and the Nasdaq Composite increased 1.00%.
- Amazon.com NASDAQ:AMZN surged 15.32% while Apple NASDAQ:AAPL declined 7.35%.
- Next week, payroll and business survey data are set to challenge the current outlook for interest rates.
U.S. equities finished up on Friday, with technology and consumer sectors posting the strongest gains. The S&P 500 advanced 0.70%, and the Nasdaq rose 1.00%. The cash session ended at 4 p.m. EDT.
The advance was less widespread than headline gains indicated. The Russell 2000 declined 0.36%, with more stocks losing ground than rising late in the session. This disparity signals a concentrated move rather than widespread risk-taking.
| Index | Friday close | Day | Week | Year to date |
|---|---|---|---|---|
| S&P 500 | 7,489.8 | +0.70% | +1.05% | +9.41% The Wall Street Journal |
| Nasdaq Composite | 25,373.9 | +1.00% | +1.59% | +9.17% The Wall Street Journal |
| Dow Jones Industrial Average | 52,485.7 | +0.53% | +1.04% | +9.20% The Wall Street Journal |
| Russell 2000 | 2,935.5 | −0.36% | +0.19% | +18.27% The Wall Street Journal |
Each of the four benchmarks ended the week in positive territory. However, on Friday, the S&P-Russell difference widened to 1.06 percentage points. Small caps continued to be the front-runner for the year.
Artificial-intelligence spending faced increased scrutiny as a result of the price movement. Investors favored clear gains in cloud revenue and reacted negatively to slower expected near-term growth.
| Company | Friday move | Data investors priced |
|---|---|---|
| Amazon.com NASDAQ:AMZN | +15.32% | AWS revenue jumped 37% to $42.2 billion. Projected 2026 capital investment was raised to approximately $220 billion. The Wall Street Journal |
| Microsoft NASDAQ:MSFT | +3.02% | Microsoft Cloud posted a 27% rise in revenue to $59.3 billion. The Wall Street Journal |
| Apple NASDAQ:AAPL | −7.35% | The company projected September-quarter revenue growth will be 9% to 11%, missing analyst estimates. The Wall Street Journal |
Amazon reported trailing free cash flow of negative $7.6 billion, compared with a positive $18.2 billion from a year ago. Shares, however, climbed 15.32%.
AWS revenue rose by 37%, and its order backlog hit $496 billion. CEO Andy Jassy noted that demand remained higher than supply. “Andy Jassy just put those fears to bed,” said Jake Dollarhide of Longbow Asset Management. Reuters
Microsoft echoed a similar sentiment. Expansion in cloud services backed substantial infrastructure investment. Apple, meanwhile, presented a less robust forecast, reflecting the impact of short-term supply constraints.
| Market signal | Friday reading | Comparison |
|---|---|---|
| S&P 500 compared to Russell 2000 | +0.70% versus −0.36% | Large-cap advantage by 1.06 percentage points The Wall Street Journal |
| Late-day market breadth | 1.1 decliners for every advancer | Negative breadth though S&P climbed Reuters |
| S&P 500 future valuation | Roughly 20 times earnings | 10-year average close to 19 times Reuters |
| 10-year Treasury note yield | 4.739% | The highest reached since January 2025 Reuters |
The valuation buffer stayed narrow. The S&P was trading at close to 20 times expected earnings, surpassing its 10-year average. As a result, yields held outsized significance.
Treasury yields rose, with investors assessing fresh concerns about inflation. The yield on the 10-year note hit 4.739%, marking its peak since January 2025. The 30-year yield advanced to 5.2713%.
The Federal Reserve left rates steady at 3.50% to 3.75% this week. Three policymakers dissented, favoring a rate hike. Futures put the odds of a September increase at around two-thirds.
Art Hogan of B. Riley Wealth stated that markets continued to be “held hostage” by movements in oil prices and the 10-year yield. Shifts in either can rapidly impact equity valuations. Reuters
The upcoming test is set for Monday, featuring July’s manufacturing data. Labor-market updates will culminate with Friday’s employment report.
| Date | U.S. release | Time | Main investor test |
|---|---|---|---|
| Monday, Aug. 3 | ISM manufacturing survey | 10:00 EDT | Production momentum and input cost trends Institute for Supply Management |
| Tuesday, Aug. 4 | June job openings | 10:00 EDT | Indications on labor shortages and wage patterns Bureau of Labor Statistics |
| Wednesday, Aug. 5 | ISM services survey | 10:00 EDT | Pressure on services pricing and activity Institute for Supply Management |
| Thursday, Aug. 6 | Second-quarter productivity, preliminary | 08:30 EDT | Signaling of unit labor cost growth Bureau of Labor Statistics |
| Friday, Aug. 7 | July employment report | 08:30 EDT | Preliminary Reuters poll: 91,000 jobs; 4.3% unemployment Bureau of Labor Statistics |
Over a quarter of S&P 500 firms are scheduled to report earnings next week, maintaining a strong connection between corporate outlooks and bond market moves.
Risks: Higher yields may result if payroll numbers beat expectations, oil climbs again, or AI outlooks disappoint. This could put Friday’s modest gains at risk. Conversely, weaker data might renew worries about economic growth.
The immediate challenge is straightforward. Cloud revenue needs to continue outpacing financing expenses.
Related articles: NASDAQ:MSFT
