Dimitra DeFotis
Senior EditorWeek in Review: Tech Lifts Markets Higher, Despite Oil & Fed
Dimitra DeFotis
Senior EditorThe U.S.-Iran war seemingly erupted again this week, but the market ultimately shrugged it off.
For the week, the S&P 500 was up 1.2%, and the Nasdaq-100 was higher by 1.7%. The PHLX Semiconductor Sector Index rose 1.55%, rebounding from a selloff. But the Dow Jones Industrial Average was off by 0.5%.
As colleague George Tsilis pointed out Friday, the week ended with four key factors. Looking at the big picture, the Federal Reserve appears hawkish, the Middle East remains unstable, and labor demand is cooling. But Meta Platforms (META) gave investors reason to revisit the AI capex story, “helping Thursday’s rally feel more durable than a simple short-covering bounce.”
Oil and energy: U.S. benchmark crude prices spiked on the U.S.-Iran break in the ceasefire, but the price of crude landed near $71.50 per barrel for the week, an increase of roughly 4.5% over five days. The reality is that transit through the Strait of Hormuz has not ground to a halt, and an eventual oversupply could bring back $60 per barrel.
Rob Thummel, Senior Portfolio Manager at Tortoise Capital, an energy-focused asset manager with exchange-traded funds, mutual funds and indexes, spoke this week about the firm’s mid-year outlook and the intertwining of energy and technology. Tortoise sees “electricity as the new oil” and points to AI infrastructure annual capital expenditure estimates reaching $3 trillion or $4 trillion by 2030. Natural gas is being used to generate more electricity this year, and that’s likely to continue, he says.
Macroeconomics and geopolitics: Charles Schwab's Collin Martin talks about the recent rise in yields, which he attributes to geopolitical volatility around the Strait of Hormuz and crude oil. While he says oil "is something to watch," he expects the Fed to remain in an interest rate holding pattern for now.
Gil Luria, an analyst at D.A. Davidson, examines the pace of Palantir (PLTR) cash flow growth this year and his firm’s upgrade, with a buy rating and price target to $175, up from $165. Expect volatility, he says.
Earnings, valuation and technology: Sheraz Mian, Research Director at Zachs Investment Research says he expects low double-digit earnings growth as the corporate profit reporting cycle begins with big banks Tuesday. Mian says that after almost four years, the core commercial banking business is “starting to fire on all cylinders,” with strong lending and consumer banking activity driving net interest income, and strong trading activity. But analysts will be listening for guidance strength into the back half of the year, he says.
Jon Adams, the CIO of Calamos Wealth Management, discussed the divergence among consumers in a K-shaped economy, with data showing the wealthy are still spending while others are delinquent on mortgage and auto payments. He also talked about tech and energy stock leadership, valuations, and attention to risk when diversifying portfolios from concentrated investments into private equity assets.
Ted Thatcher, President of Bright Lake Wealth Management, says "the markets are cheaper now than they were at the beginning of 2026," which is why he thinks the S&P 500 (SPX) will reach 8,000 by the end of the year. The AI trade is the leading catalyst for earnings, but the Fed could produce headwinds. He also weighs in on the valuation of Micron (MU) considering AI being in early innings.
Many of our well-watched videos this past week were about technology:
- Samsung Shows AI Memory Trade Here to Stay, Rally Runway Questioned
- SK Hynix U.S. IPO: Where it Fits in Greater AI Trade as Memory Demand Surges
- Explaining Wall Street's Tech Rotation, Memory Movers & META's AI Stance
As always, bookmark our articles to keep up on the market open and close and if you missed it, check out our July 4 Week in Review, with the Schwab Mid-Year Market Outlook recap.
