The S&P 500 (Index: SPX) dropped almost 1.4% from its previous week's close to wrap up the trading week ending on Friday, 21 August 2026 at 7,678.76.

Rising bond yields was perhaps the biggest driver of stock prices during the week, which comes as the U.S. government is increasingly having to compete with Big Tech to borrow money as the company's seeking to build out the infrastructure to support the expansion of Artificial Intelligence (AI) systems are borrowing big to do it.

One outcome of that dynamic is expectations of higher interest rates. The CME Group's FedWatch Tool projections of the expected future for how the Fed will set the Federal Funds Rate changed little in the past week. It anticipates a 60% chance the Fed will act to hike this core interest rate to a target range of 3.75-4.00% on 28 October (2026-Q4), while giving a much stronger 98% chance this rate will be in effect on 9 December (2026-Q4). Beyond that, the FedWatch Tool now anticipates another quarter point rate hike on 28 April (2027-Q2).

Meanwhile, stock prices behaved almost exactly as would be expected if investors were tightly focusing on 2027-Q1 as they set the level of the week's stock prices. The latest update of the alternative futures chart shows that outcome as the S&P 500's trajectory closely paced the dividend futures-based model's projection associated with investors fixing their attention on the distant future quarter of 2027-Q1.

Investors had quite a lot of other new information to absorb during the trading week. Here is the summary of the week's market-moving headlines:

Monday, 17 August 2026

• Signs and portents for the U.S. economy:
• 30-Year Treasury Yield hits 5.30%, its highest level since 2007
• Oil settles up over $2 as Iran war stalemate stokes supply concerns
• Brent oil rises above $90 as Iran rules out interim deal extension, threatens to escalate conflict
• Depleted strategic oil reserve nears level that raises concerns about damage to caverns, operations
• Economists predict Fed minions to leave interest rates unchanged in rest of 2026:
• Fed to hold interest rates this year, economists say, sticking to their view
• Bigger trouble, stimulus developing in China:
• China's recovery sputters as consumption, output lose steam
• China investment slump deepens as economy shows signs of weakness
• China new home prices stagnant in July as demand stays weak
• China's premier calls for stabilising external demand as growth sputters
• Bigger trouble developing in Japan, BOJ minions catch a break in effort to prop up Japan's currency:
• Japan Q2 growth misses forecasts on weaker spending, investment
• Japan second-quarter GDP grows 1.1% on an annualized basis, missing expectations
• Yen edges up as traders push back Fed rate hike bets
• Japan’s 10-year bond yield hits three-decade high
• Bigger trouble developing in Eurozone:
• Europe's heatwaves expose insurance gap as business losses mount
• China’s unplanned surpluses put EU in trade bind
• ECB minions say AI stocks are due for a fall:
• AI market correction is coming, ECB blog predicts
• Wall Street finished lower as investors look ahead to retail earnings
• Wall Street indexes slip as oil prices rise, retail results awaited

Tuesday, 18 August 2026

• Signs and portents for the U.S. economy:
• As US debt mounts, investors demand higher returns to lend
• US 30-year yields hit highest level since 2007 as war, oil worries fester
• US yields edge lower despite Iran worries, broader sell-off
• Oil closes at three-week high as hopes of US-Iran peace deal fade
• US diesel crack surpasses $100 a barrel for the first time on supply disruptions
• Fed minions say their monetary policy is "accommodative":
• One neutral rate estimate suggests Fed's policy stance is accommodative, paper says
• Bigger trouble, stimulus developing in China:
• China's easing steel output reflects divergent demand drivers
• China has one good reason for its credit slump
• China’s 10-year bond yield falls to 13-month low
• Bigger trouble developing in Japan:
• As Japanese Bond Yields Soar, Unrealized Losses At Life Insurers Hit $200 Billion
• Bigger trouble developing… everywhere:
• Global bond markets put governments on notice over fiscal, inflation risks
• Wall Street finished in the red as attention remains on the Middle East
• Tech selloff weighs down Wall Street as bond yields climb
• Explainer: Treasury yields are rising - why does it matter?

Wednesday, 19 August 2026

• Signs and portents for the U.S. economy:
• US housing market remains under pressure in July; factory output rises
• Oil extends climb on prolonged Hormuz export uncertainty
• Demand from US data-center boom radiates out through factory supply chains
• US 30-year Treasury yields drop from multi-year highs
• Treasury Secretary Bessent doubles US long-bond buybacks in the face of surging yields
• VIEW Yields fall after US Treasury says it will double some bond buybacks
• Port of Los Angeles posts high July volume, helped by retail goods, AI project parts
• Fed minions worried about inflation back in July 2026, just realized increase in productivity blunted it:
• Fed policymakers' inflation concerns increased at July meeting, minutes show
• Boston Fed paper says strong productivity blunted tariff inflation impact
• Bigger trouble developing in China:
• China seen holding loan rates steady in August despite economic weakness
• China robot makers seek to turn humanoid hype into useful work
• Bigger trouble developing in Japan:
• Japan bond yields near 3% as inflation, fiscal worries mount
• Japan has few answers as bond rout puts fiscal plans at risk
• Wall Street ended higher, and yields dipped after the latest Treasury Department announcement
• Wall St rises as yields ease, Moderna lifts healthcare stocks

Thursday, 20 August 2026

• Signs and portents for the U.S. economy:
• US Treasury buyback briefly eases bond rout, but debt worries persist
• Treasury's Bessent says upsized bond buybacks could increase further
• Oil settles up more than 2% after Trump threatens countries supporting Iran
• U.S. military says it aided passage of 660 million barrels of oil through Strait of Hormuz since May
• Fed minion says they're not sure how Fed will set U.S. interest rates in September 2026:
• Fed's Musalem says on CNBC he won't prejudge rate call view for September FOMC
• Bigger trouble developing in and out of China:
• China boosts imports of Russian crude, stymieing India's refiners
• BOJ minions / Bigger trouble developing in Japan:
• Japan's exports surge on chips demand, imports hit record on oil costs
• Bigger trouble developing in the Eurozone:
• Europe’s oil refining capacity set to shrink by 20% over next decade
• Wall Street ended lower as Walmart dragged down retail and oil climbed
• Wall Street sinks as bond yields rise, Walmart results disappoint
• Walmart sales growth slowdown tests consumer resilience, shares slide 9%

Friday, 21 August 2026

• Signs and portents for the U.S. economy:
• US service sector fuels acceleration in business activity, S&P Global says
• Oil rises as Trump threatens sanctions on Iran partners
• US Mortgage Rates Fall for Second Straight Week, to 6.65%
• Fed minions try not to upset their real boss:
• Fed officials tread carefully after Treasury's bond market intervention
• BOJ minions potentially planning rate hikes up through July 2027:
• A date on the calendar could shape the BOJ's endgame on interest rates
• Japan's core inflation accelerates in July, bolsters case for rate hike
• Bigger trouble developing in Eurozone (hawkish ECB minions):
• Traders are bracing for an increasingly hawkish ECB
• S&P 500 drops for week as Tech leads sector losses
• Dow surges 500 points Friday, but index posts back-to-back weekly losses
• Gains in AI company stakes juice second-quarter earnings for S&P 500
• US corporate AI debt surge tests investor limits as fatigue emerges
• Wall Street ended higher as gold and Bitcoin rallied

The Atlanta Fed's GDPNow tool anticipates +4.0% real GDP growth for the U.S. economy in 2026-Q3, dipping from the +4.3% annualized growth it projected a week earlier.

Image credit: Microsoft Copilot Designer. Prompt: "An editorial cartoon of a Wall Street bull holding up a sign that says 'RISING BOND YIELDS' who is growling at scared investors"

When we launched the S&P 500's Thanksgiving Leftover project the day after Thanksgiving 2025, we knew we were going to spend the next year following the stock prices of companies that weren't doing very well. After all, to even make the list, the ten companies whose stocks we would track ranked as the S&P 500's worst performing stocks of 2025.

In the nine months since then, a few of those stocks have outperformed the index, while the rest have lagged behind. Most of those stocks have fallen below their post-2025 Thanksgiving Day level, but not by anywhere near as much as they had fallen to qualify as one of the S&P 500's worst performing stocks in 2025.

But one stock in particular has gone on to plumb new depths. It has continued to fall so much more that it is on track to qualify as one of the S&P 500's worst performing stocks of 2026.

That stock is The Trade Desk (NASDAQ: TTD), the digital advertising firm analyst David Desjardins believes is facing an "existential crisis". Here's how he describes the company's now nearly two year long fall from grace:

After reporting highly disappointing financial results for the second quarter of 2026, shares of The Trade Desk, Inc. (TTD) declined by a whopping 21.9% last Friday, which came on top of a 6.8% decline on the prior day. Since the publication of my initiating coverage in early February 2026, TTD's stock price has basically been cut in half, from ~$27.00 per share at the time of publication to around $13.39 as of today's market close.

Relative to its all-time high of $141.53 reached in December 2024, The Trade Desk has now declined by a massive ~90%. As David Einhorn famously said, a stock down 90% is just a stock that was down 80% before being cut in half again, and this is exactly what happened to TTD since last February. The depth of TTD's sell-off is quite something, but what is even more impressive to me is its speed....

At this point, The Trade Desk has become one of the most hated stocks that I am aware of, and this is on top of being the worst-performing constituent in the S&P 500 (SPX) on a year-to-date basis. Pretty much everything said or written about the company is negative, and it is precisely why I decided to write an update today. In less than two years, TTD went from a market darling that could do no wrong at over 26.0x forward sales to being viewed as a melting ice cube changing hands at 2.3x forward sales today.

The following chart compares The Trade Desk's stock performance with the S&P 500, from 29 November 2024 (aka "the day after Thanksgiving Day 2024) through 18 August 2026:

Believe it or not, despite the company's continued misfortune, Desjardins views the company's low stock price as a speculative strong buy opportunity, where he makes the argument that the company has some potential for a turnaround based on its available cash balance, lack of debt, and cash flow.

We disagree, because we think The Trade Desk has further to fall before it might reach that point.

Here's why. According to SlickCharts, The Trade Desk's market cap has fallen to where the company now ranks 502 out of the 503 stocks that make up the S&P 500 index. Because it has, and because its fall is continuing, the company's stock is verging on the point where S&P will act to remove it from the index. If and when that happens, as increasingly seems likely, its stock price will experience the opposite of what happens when a company's stock is included in the index, which is to say its stock price will fall even further.

A deeper decline is almost ensured given the negative outlook CEO Jeffrey Green communicated during the company's 2026-Q2 earnings call. Gytis Zizys, who formerly held a buy rating for the company on the hope it will see a turnaround, reacted to that development:

The Trade Desk, Inc. (TTD) provided one of the worst guidances I’ve seen in recent months, which put the last nail in the coffin for many shareholders who were still clinging to the idea of a turnaround. It seems I was prematurely too bullish on the turnaround as well, and this report is forcing me to downgrade it to a hold. I don’t think there’s a point in selling at these low prices, unless you want to harvest some tax losses. If it gets to under $10 per share, I will be jumping in to see what happens over the next couple of years. It’ll either recover, or my investment will go to zero.

The only problem with this investing strategy is we can argue that the bar for being able to beat TTD's stock performance is very low. It's so low that investing almost anywhere else or just parking the money in a cash savings account would be more advantageous.

This article is a standalone feature in our ongoing Thanksgiving Leftover series, which will continue with its regular monthly installment later this month. The ongoing tragedy of the performance of The Trade Desk's stock demanded a special edition.

The dividend outlook of the S&P 500 (Index: SPX) once again delivered a mixed outlook for investors in August 2026.

Expected dividends for the index dipped in the current quarter of 2026-Q3, but the amount of cash dividends expected to be paid out in the upcoming future quarters of 2026-Q4 and 2027-Q1 increased. The more distant future quarters of 2027-Q2 and 2027-Q3 however both declined with respect to the July 2026 snapshot of the S&P 500's dividend outlook.

All these changes however are modest, with the magnitude of the changes for each quarter coming in at less than one percent. Here is the summary of how the expected future for the S&P 500's dividends changed between 14 July and 14 August 2026:

• 2026-Q3: Decrease of $0.11 to $21.02 per share
• 2026-Q4: Increase of $0.10 to $21.55 per share
• 2027-Q1: Increase of $0.06 to $22.81 per share
• 2027-Q2: Decrease of $0.15 to $21.60 per share
• 2027-Q3: Decrease of $0.11 to $21.81 per share

The following chart illustrates the expectations for the S&P 500's quarterly dividends per share as of 14 August 2026 and how they compare with the preceding quarters going back to 2024-Q3.

More About Dividend Futures

Dividend futures represent the quantified expectations investors have for the future income they will realize from owning shares of stocks, which in turn, affects how investors set current day stock prices. How changes in the outlook for dividends at specific points of time in the future contribute to changes in current day stock prices as represented by the value of the S&P 500 index is described by this math.

Dividend futures for the index indicate the market capitalization-weighted amount of dividends per share for all these dividend-paying stocks that are expected to be paid out over the period covered by each quarter's dividend futures contracts. These contracts start on the day after the preceding quarter's dividend futures contracts expire and end on the third Friday of the month ending the indicated quarter. For example, as determined by dividend futures contracts, the now "current" quarter of 2026-Q3 began on Saturday, 20 June 2026 and will officially end on Friday, 18 September 2026. Since the expectations for this quarter's dividend payouts can change all the way up to that final date, it counts as a future quarter all the way up through that future point in time.

Because dividend futures are tied to options contracts that run on this schedule, that makes these figures different from the quarterly dividends per share figures that are reported by Standard and Poor. S&P reports the amount of dividends per share paid out during regular calendar quarters after the end of each quarter. This term mismatch accounts for the differences in dividends reported by both sources, with the biggest differences between the two typically seen in the first and fourth quarters of each year.

Image Credit: Microsoft Copilot Designer. Prompt: "A crystal ball with the word 'SP 500' written inside it". And 'Dividends' written above it, which we added.

The S&P 500 (Index: SPX) reached a new record high close of 7,798.99 on Thursday, 13 August 2026 before falling back on Friday to end the trading week at 7,785.76.

Two developments helped to spur the index to its new heights. First, investors received good inflation news on Wednesday, 12 August 2026 when the Consumer Price Index came in lower than expected. The second came on Thursday, when the Producer Price Index was likewise reported to be lower than expected.

Because of these benign consumer and producer price inflation reports, the CME Group's FedWatch Tool no longer anticipates the Fed will act to hike the Federal Funds Rate from its current target range of 3.50-3.75% in September 2026, but will instead delay a quarter point rate hike to take place sometime in the fourth quarter of 2026. In its latest snapshot, the FedWatch Tool sees a falling 53% chance the Fed will act to hike this core interest rate to a target range of 3.75-4.00% on 28 October (2026-Q4) but gives a more solid 93% chance this rate will be in effect on 9 December (2026-Q4).

With the next rate hike likely delayed and fewer rate hikes on the table as a result of the better than expected inflation reports, the resulting lower interest rates kept investors focused on the first quarter of 2027 as they set current day stock prices. The latest update of the alternative futures chart shows the level of stock prices is right where they dividend futures-based model forecasts it would be provided investors are focused on 2027-Q1.

While those were the biggest headlines, other things happened that contributed to the random onset of new information investors absorbed and reacted to during the week that was. Here is our summary of the week's market moving headlines:

Monday, 10 August 2026

• Signs and portents for the U.S. economy:
• July US container imports hit fourth-highest on record, Descartes says
• Oil climbs 5% as Iran, US both demand compensation and Hormuz hopes fade
• Oil in U.S. Strategic Petroleum Reserve falls below 300 million barrels, lowest since 1983
• Lower inflation, global ambitions developing in China:
• China July factory-gate inflation eases to 3-month low, CPI slows
• China's central bank vows to expand yuan's international use in five-year plan
• China bypasses shipping chokepoints with ‘Ice Silk Road’ through Arctic
• Bigger trouble developing in Japan as BOJ minions plan next rate hikes:
• BOJ's rate-hike path runs into Takaichi's bond market problems
• BOJ's debate on faster hikes bolsters September rate move odds
• Bigger trouble developing in Eurozone:
• German trade deficit with China grows as Beijing relies less on European industry
• Wall Street concluded moderately lower as hopes for Hormuz reopening fade
• Wall Street ends down as expectations of Hormuz deal fade
• Market breadth strengthens: Equal-weight S&P 500 pulls ahead of market-weight index
• Meta to open source its most powerful AI model as it takes swipe at OpenAI, Anthropic
• Microsoft plans to unveil next-generation AI chip in September, The Information reports

Tuesday, 11 August 2026

• Signs and portents for the U.S. economy:
• US court rules Meta, other tech firms must face thousands of lawsuits over social media addiction
• US existing home sales fall further; small business sentiment at 11-month high
• Oil prices settle up as Iran says Strait of Hormuz to stay shut
• U.S. oil tops $84 as Hormuz deal hopes dwindle and deadlock deepens
• US auto loans hit record high in second quarter, New York Fed says
• US officials work to close supply chain gaps as foreign investment grows
• Fed minions say inflation is their biggest problem:
• Inflation is the biggest problem, Fed's Goolsbee says
• Atlanta Fed's Venable: Inflation too high, with prospect of easing dependent on events in Middle East
• Bigger trouble, stimulus developing in China:
• China's car sales extend slide as shift accelerates to overseas markets
• Surge in China's coal imports may start to taper off
• Bigger trouble developing in Japan:
• Yen sinks as effect of US-Japan intervention fades
• Wall Street ended lower as eyes remain on the Middle East and upcoming inflation data
• Wall Street ends down as US-Iran peace optimism fades

Wednesday, 12 August 2026

• Signs and portents for the U.S. economy:
• US annual inflation cooled to 3.4% in July
• Headline CPI rises 3.4% in July, slowing from June's pace
• Rate-Hike Odds Tumble As US Consumer Price Inflation Prints Slowest Since Pre-War
• Oil prices edge up as investors weigh US-Iran talks deadlock against lower demand
• OPEC further lowers 2026 global oil demand growth forecast
• Mortgage rates finally stop rising, causing demand to trickle back
• Before the CPI inflation report: Fed minions say poor Americans are struggling to make ends meet, want to hike their interest rates:
• Boston Fed's Collins open to interest rate increase in September, FT says
• Poorer Americans are struggling to make ‘ends meet’, top Fed official says
• Investors worry leaner Fed guidance may come at a price
• After the CPI inflation report:
• Fed expected to leave rates unchanged next month after soft inflation data
• Bigger trouble, stimulus developing in China:
• China's central bank pledges timely new policy rollout
• Wall Street finished up in the green after the latest inflation report
• S&P 500 ends higher as CoreWeave results fuel AI optimism
• CoreWeave, Super Micro surge on signs of sustained AI buildout
• 23 dividend safety stocks beating the S&P 500 this year

Thursday, 13 August 2026

• Signs and portents for the U.S. economy:
• US producer prices unchanged in July, further dimming rate hike odds
• Oil settles down 2% on weak demand outlook, hefty US crude build
• One Fed minion notices inflation data doesn't support rate hikes, other Fed minion is slow on the uptake, while third is flapping in the wind:
• Fed's Goolsbee says latest inflation data is better
• Fed should raise rates to restrain growth and inflation, Hammack says
• Fed's Barkin: Still an "open question" if rate hike will be needed to meet inflation target
• BOJ minions excited to get inflation data to support their plans to keep hiking Japan's interest rates:
• Japan's wholesale inflation stays hot, bolstering odds of September BOJ hike
• Rate hike bets leave yen's post-intervention gains at BOJ's mercy
• Japan may see more yen intervention, faster BOJ rate hikes, ex-top FX diplomat says
• Wall Street ended on top as the S&P 500 notched a new record high
• S&P 500 notches record-high close as rate-hike worries ease
• S&P 500 hits 27th record high of 2026 — History says more likely ahead

Friday, 14 August 2026

• Signs and portents for the U.S. economy:
• US retail sales post first decline in nine months in July
• Oil set for weekly gains after US threatens indefinite blockade of Iran
• Fed rate hike odds sink further as retail sales, consumer sentiment fall
• US retail sales post first decline in nine months in July
• Fed minions expected to sit on hands rather than hike rates in September 2026:
• Cooler inflation data may force Warsh's divided Fed to hold the line on rates
• Bigger trouble developing in and out of China:
• China July bank loans post record contraction as credit demand falters
• Chinese car sales are booming almost everywhere - just not at home
• BOJ minions getting super excited to hike Japan's interest rates again:
• BOJ eyeing September rate hike, faster pace of tightening, sources say
• Central bank minions around globe betting big on gold:
• Central banks spearhead renewed gold rush
• Wall Street ended lower a day after the S&P 500 notched a record high
• S&P 500 ends lower as investors weigh data, Middle East tensions
• S&P 500 posts weekly gain as strength spreads beyond technology

The Atlanta Fed's GDPNow tool anticipates real GDP growth for the U.S. economy of +4.3% in 2026-Q3, down from the +5.8% annualized growth it forecast a week earlier.

Image credit: Microsoft Copilot Designer. Prompt: "An editorial cartoon of a Wall Street bull and bear who give each other a high-five after news breaks that inflation came in lower than expected while Federal Reserve officials are sad they won't be able to hike U.S. interest rates when they wanted".

The S&P 500 (Index: SPX) shot up by nearly 3.6% over it's closing value in the previous week, reaching a new record high closing value of 7,757.46 by the end of the trading week ending on Friday, 7 August 2026.

Strong earnings being reported in the early part of the week provided much of the stock market's upward momentum, with technology and materials stocks providing much of the boost. The positive outlooks being reported by many firms in these sectors contributed to shifting the time horizon of investors forward from either 2026-Q3 (or 2026-Q4) to the more distant future quarter of 2027-Q1.

That change in how far forward investors are looking into the future as they set current day stock prices constitutes a Lévy flight event, which can be seen in the latest update of the dividend futures-based model's alternative futures chart.

On Friday, 7 August 2026, an unexpectedly negative jobs report changed the expected timing of when the Federal Reserve will change short term interest rates in the U.S. The CME Group's FedWatch Tool's outlook changed substantially with the unexpectedly sour employment situation report for July 2026. It now projects the Fed will hike the Federal Funds Rate by a quarter point on 28 October (2026-Q4), six weeks later than it projected a week earlier. It also now sees a greater than 50% chance of another quarter point rate hike on 17 March (2027-Q1).

Here are the other market moving headlines from the week that was:

Monday, 3 August 2026

• Signs and portents for the U.S. economy:
• Chinese state traders make large US soybean purchases
• Oil prices drop after Trump cancels attack on Iran to seek nuclear deal
• OPEC+ agrees September oil hike, completing rollback of voluntary cuts
• US manufacturing activity hits more than four-year high; input prices elevated
• Fed minions say they've got this inflation thing covered:
• Fed's Williams expects inflation to ease, says Fed will act if it doesn't
• FULL TEXT Transcript of Reuters interview with NY Fed President Williams
• Bigger trouble developing in China:
• Factories faced weaker demand, higher costs in July as Iran war grinds on
• China factory growth slows to 4-month low in July, survey shows
• BOJ minions team up with U.S. Treasury to prop up Japan's currency, worry about AI demand making inflation 'sticky':
• Japan, US confirm joint yen-buying intervention, signal more action
• Japan, Bretton Woods 2.0, & The End Of The Carry Era
• How a US-Japan pact to hit yen speculators came together
• Bessent ready to repeat joint yen intervention, urges bigger Fed backstop
• BOJ says global AI demand could have sticky inflationary effect
• Wall Street ended higher as markets flirt with record highs
• Wall Street rallies, Dow closes at record on Iran talks optimism

Tuesday, 4 August 2026

• Signs and portents for the U.S. economy:
• Oil prices settle 5% lower after claims of progress in US-Iran talks
• US oil exports in July fall to lowest level in eight months, data shows
• Fed minion claims they have 'open mind':
• Fed's Paulson keeps 'open mind' on rate policy outlook amid high inflation
• Global economy changes developing in China:
• China's EV export boom is starting to show up in the gasoline market
• BOJ minions leave door to more interventions to prop up yen open, JapanGov minion says inflation not so bad:
• Yen holds most gains as intervention keeps speculators on edge
• Japan may not have intervened in FX market on Monday despite yen's surge, BOJ data suggests
• Japan, US likely to intervene again if yen resumes slide, ex-BOJ official says
• Japan's economy minister offers sanguine view on inflation
• Mixed economic signs developing in Eurozone:
• Euro zone factory output near 4 1/2-year high in July but demand still weak
• Iran war hit euro zone consumption especially hard, ECB says
• Wall Street ended higher as the S&P 500 and Dow notched record closes
• Dow, S&P 500 close at record on AI-linked earnings, Mideast deal hopes
• S&P 500 tags an all-time high and these 10 names have helped fuel the rally

Wednesday, 5 August 2026

• Signs and portents for the U.S. economy:
• OpenAI, Anthropic AI agents implicated in new security breaches
• Oil prices rebound after Houthis say they attacked Saudi tanker
• US service sector maintains strong growth pace in July
• Fed minions say they're chafing at the bit to hike U.S. interest rates some more:
• Fed's Schmid calls for tighter monetary policy to tamp down on 'too high' inflation
• Fed's Schmid says finances around AI buildout merit watching
• Fed's Cook ready to raise rates if inflation doesn't start easing
• Bigger trouble developing in China:
• China services growth hits slowest since September 2024, private PMI shows
• China launches global tax hunt going back decades
• Hong Kong insurers' shares slump on report China to tax offshore insurance income
• BOJ minions thinking about hiking interest rate again, are asked to loan more money to Japan's government:
• BOJ debated mounting price risks even upon hiking rates in June, minutes show
• Nudge from Bessent firms case for BOJ rate hike in September
• Bessent says he is sure BOJ chief Ueda will 'do what is best', NHK reports
• Japan PM Takaichi asked BOJ to buy more bonds when needed, Jiji reports
• ECB minions say AI is adding to Eurozone economy growth:
• ECB says investment shift towards AI helps ease drag of uncertainty on euro zone growth
• Dow closes at record on Mideast optimism; SpaceX, AMD drag Nasdaq
• Wall Street concluded mixed after a softer jobs report

Thursday, 6 August 2026

• Signs and portents for the U.S. economy:
• US labor market stable; worker productivity accelerates in second quarter
• Oil settles up $3 as Iran reviews bill to ban US, Israeli vessels from Hormuz
• One Fed minions not so anxious to hike U.S. interest rates, another wishes they already did:
• Fed's Daly says central bank was right to hold rates steady at July policy meeting
• Fed's Musalem says central bank should have hiked rates at last meeting
• Bigger trouble, stimulus developing in China:
• China's July exports growth likely cooled but still robust
• JapanGov minion says they're looking to tap BOJ minions' investment holdings to pay for tax cut:
• Bank of Japan's ETF holdings may help fund tax cut, LDP executive says
• Wall Street ended lower as investors remain focused on Middle East developments
• Stocks close lower as investors eye Mideast talks, earnings
• More S&P 500 stocks outperform benchmark in strongest breadth in a decade, Balchunas says

Friday, 7 August 2026

• Signs and portents for the U.S. economy:
• US suffers unexpected job losses in July, markets dial back rate hike expectations
• U.S. economy unexpectedly lost 23,000 jobs in July
• Expectations going into the July jobs report: US job growth likely picked up in July
• Brent climbs $1 on uncertainty over end to Iran war
• Fed minions expected to back off rate hike plans after jobs report:
• Market cuts odds of Fed hike after jobs data, but economists still see case for tightening
• NY Fed finds little change in inflation expectations in July
• Fed's Barkin says July jobs data matches recent trend
• Bigger trouble, stimulus developing in China:
• Chinese startup Moonshot's AI model breaks out of testing environment, researchers say
• BOJ minions get unexpected boost in ongoing effort to prop up Japan's currency:
• Japan's yen surges after US jobs data, traders wary of intervention risk
• US euro sale to prop up yen blindsided ECB
• Bigger trouble developing in Eurozone:
• Debt burden grows for German suppliers in embattled auto sector, study shows
• S&P closes at record high as soft jobs report eases rate-hike concerns
• S&P 500 rises as it wraps up banner week with traders seeing bright side of dismal jobs report
• S&P 500 posts weekly gains as Tech, Materials lead sector rally

The Atlanta Fed's GDPNow tool anticipates real GDP growth for the U.S. economy of +5.8%, up from the +5.0% annualized growth it indicated at the end of July 2026.

Image credit: Bing Image Creator. Prompt: "An editorial cartoon of a Wall Street bull who is happy that strong earnings are boosting the S&P 500".

Two months ago, the S&P 500 (Index: SPX) was rising so quickly it raised the prospect the index could see a break down in the relative period of order the index established since the end of 2023.

Instead, after peaking on 2 June 2026, the S&P 500 has reverted toward its established mean trajectory. Through the end of July 2026, the index is hovering right around that 31-month-old central trend curve.

Which is to say the index remains well within its established relative period of order after having regressed toward its mean trend trajectory. Whatever bubble might have been forming within the index has mostly deflated.

The following chart visualizes the relationship between the value of the S&P 500 and its underlying trailing year dividends per share from 29 December 2023 through 31 July 2026:

Previously on Political Calculations

• How Big is the AI Bubble and Is It Really a Bubble?
• The Definition of a Bubble
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Image Credit: Microsoft Copilot Designer. Prompt: "An editorial cartoon of a Wall Street bull and bear looking at a balloon labeled 'AI BUBBLE?' that has deflated".

The direction the S&P 500 (Index: SPX) takes is shaping up a lot like a playing a game that has a 50% chance of winning or a 50% chance of losing.

Investors saw that game play out during the past week as several of the Big Tech companies that dominate the index reported their earnings and updated their outlooks. For example, the world's biggest company, Apple (NASDAQ: AAPL) briefly touched a $5 trillion valuation before disappointing investors with its supply chain struggles, sending its shares lower.

But that loss was offset for the index as both Amazon (NASDAQ: AMZN) and Microsoft (NASDAQ: MSFT) were more positive.

By the time the trading week ended on Friday, 31 July 2026, the bulls came out ahead as the index rose almost 1.1% above its previous week's close to reach a value of 7,489.72.

The latest update of the alternative futures chart shows stock prices are consistent with investors focusing their forward looking attention on either the current quarter of 2026-Q3 or the more distant quarter of 2026-Q4.

The dividend futures-based model indicates very little difference in where it projects the level of the S&P 500 would be for investors fixing their attention on either these two future quarters.

As for why these two quarters would be of particular interest to investors, they happen to represent the likely timing of when the Fed will act to change the Federal Funds Rate. The CME Group's FedWatch Tool projects two quarter point rate hikes before the end of 2026. The first would occur after the Fed meets on 16 September (2026-Q3) and the second would take place on 9 December (2026-Q4).

Here are the market-moving headlines of the week that was:

Monday, 27 July 2026

• Signs and portents for the U.S. economy:
• US core capital goods orders rise, shipments post largest gain in 4-1/2 years amid AI investment boom
• Oil prices settle at lowest in over a week, as US pauses attacks on Iran
• Oil prices slide, Brent crude below $90 as pause to U.S.-Iran hostilities appears to hold
• Bigger trouble, stimulus developing in China:
• China's industrial profit growth moderates as exports cushion uneven recovery
• China begins making homegrown DUV chipmaking tools, The Information reports
• Chipmaker CXMT vaults to top of China's valuation with 466% surge in Shanghai debut
• China accuses US of 'AI hegemonism', threatens countermeasures over potential probes
• China opposes US 'forced labour' tariffs, calls for them to be cancelled
• BOJ minions getting excited to hike Japan's interest rates some more:
• Bank of Japan to signal more rate hikes as price pressures build
• ECB minions say interest rate hikes will continue until Eurozone morale improves:
• ECB's Kazimir: September rate hike likely needed even if outlook improves
• ECB facing mid-sized inflation shock, will get to 2% in year or so, Lane says
• Wall Street closed mixed as eyes remained focused on U.S.-Iran relations
• Wall Street ends mixed as investors focus on tech earnings

Tuesday, 28 July 2026

• Signs and portents for the U.S. economy:
• US goods trade deficit shrinks, is still expected to weigh on Q2 GDP growth
• Oil prices fall 5% to two-week low after several days without US-Iran strikes
• Fed minions not expected to hike U.S. interest rates this week:
• Bar to Fed rate hike this week remains high even as markets see a chance
• Uneven economic growth developing in China:
• High-tech manufacturing hubs pull ahead in China's uneven growth
• Bigger trouble developing everywhere:
• Persistently high inflation to nag global economy, say economists: Reuters poll
• S&P 500 ends higher as investors await tech earnings
• Wall Street ended mixed as global tech softness weighs and earnings take center stage
• Apple briefly tops $5 trillion market value for first time

Wednesday, 29 July 2026

• Signs and portents for the U.S. economy:
• US mortgage rates climb again in latest week, many at year high
• Oil jumps 7% on escalating Middle East airstrikes
• Brent oil jumps back above $90 after Trump threatens to hit Iran hard
• OpenAI's rogue agent compromised a customer at a second tech firm
• Fed minions follow through on expectations with no rate hike, three minions dissented:
• Fed leaves rates unchanged; three policymakers dissent in favor of a hike
• VIEW Fed holds rates steady as three policymakers dissent for a hike
• No Rate-Change Sparks 3 Dissents As Warsh Fed Delivers Biggest 'Non-Cut' Surprise In Decades
• Fed meeting recap: Warsh says Fed won’t hesitate to stop inflation, but bond market has doubts
• Bigger stimulus developing in China:
• China sets overnight reverse repo rate steady at 1.25%, sources say
• Wall Street ends lower as FOMC holds interest rates steady
• Wall Street closes down sharply after Fed holds rates unchanged
• Dow drops 1,100 points for worst day since April 2025 on fear the Fed is falling behind on inflation
• The US10Y is above 75% of its three-year range – this is what it means for the S&P 500

Thursday, 30 July 2026

• Signs and portents for the U.S. economy:
• US economic growth slows but domestic demand robust
• Oil edges down in choppy trading amid Oman-Iran talks, US-Iran tensions
• Fed minions see long-term interest rates rise after sending "muddled" message:
• Fed's 'hawkish hold' muddies path for stocks and bonds
• US 30-year yield hits 2007 high, stocks attempt post-earnings recovery
• Bigger trouble, smaller stimulus developing in China:
• China's factory activity expected to have stalled in July: Reuters poll
• China generates less than half of its electricity from coal for the first time
• China's leaders pledge to support economy without big new stimulus plans
• BOJ minions suspected of taking action to prop up Japan's currency:
• Yen surges, analysts suspect official Japanese intervention
• Faster growth, bigger inflation developing in Eurozone:
• Euro zone economy grows faster than expected on AI spending, confident consumers
• German inflation accelerates to 2.8% in July
• Wall Street closed higher as chips rallied and latest GDP and inflation figures landed
• Wall Street ends sharply higher, lifted by soaring Microsoft
• Microsoft sets record with near $450 billion single-day gain in market value

Friday, 31 July 2026

• Signs and portents for the U.S. economy:
• Big Tech AI spending spree tops $1tn
• Anthropic's Claude AI hacked three companies during tests
• What we know about the rogue AI-agent security breaches
• Oil falls more than $1 on greater flows despite US-Iran war
• US Treasury yield curve 'twist' reflects view Fed may not hike again
• Fed minions make case for September rate hike, some argue inflation is lowest it's been in years, chief Fed minion thinking about changing the schedule:
• Fed dissenters sketch the case for a rate hike
• As Warsh’s Fed faces pressure to act on inflation, these indicators show it’s at its lowest in years
• Warsh raised changing frequency of Fed policy meetings, NYT reports
• Bigger trouble, stimulus developing in China:
• China's factory activity shrinks in July as demand falters, fuelling slowdown concerns
• China approves eight new nuclear power units
• BOJ minions pass on hiking Japan's interest rates, but hint they'll resume hiking them later with inflation rising; also busy with propping up Japan's currency:
• Yen remains under pressure after BOJ kept rates unchanged
• Annual core inflation in Japan's capital accelerates in July
• BOJ nods to chance of early rate hike as Tokyo props up yen
• Japan intervenes to prop up yen ahead of BOJ policy decision, source says
• Japan may have sold up to $59 billion in yen-buying intervention
• History of Japan's intervention in currency markets
• US Treasury informed banks that it may intervene in Japan's yen, source says
• ECB minions see higher inflation in Eurozone:
• Euro zone inflation ticks up in July, bolstering rate hike case
• Eurozone inflation rises to 2.9% in July
• S&P 500 posts weekly gain as consumer discretionary shines
• Wall Street ends higher as Amazon soothes AI jitters
• Amazon lifts investment plans after strong cloud sales; shares jump
• Apple disappoints with forecast dogged by supply chain struggles
• Apple set to lose nearly $500 billion in value after weak forecast

The BEA's first estimate of annualized real GDP growth during 2026-Q2 is 1.5%, just a bit below the Atlanta Fed's GDPNow tool's final estimate of +1.7% for the quarter. Meanwhile, GDPNow tool's first estimate of real GDP growth for the U.S. economy in the now current quarter of 2026-Q3 is +5.0%.

Image credit: Microsoft Copilot Designer. Prompt: "An editorial cartoon showing a Wall Street bull and bear spinning a Price Is Right style Big Wheel labeled 'WHICH WAY WILL STOCKS GO?’ with values 'UP' and 'DOWN'".