The S&P 500 (Index: SPX) retreated 1.5% from its previous week's close to end the week at 7,457.69.

Much of the market's downward movement came in response to a growing awareness among investors of the high cost of utilizing the most advanced AI systems over the last several weeks. The shift in sentiment has largely capped the upward movement of these stocks despite many having just reported strong earnings.

But it hasn't deflated the S&P 500 the way the index crashed during 2025's "DeepSeek" scare, which one analyst provocatively described as "hiding" a crashing market brought about by investors rotating their investments from AI tech stocks into other sectors of the market.

That's a phenomenon we've described as the conveyance effect. This is a special case of market rotation, in which the gains of what might be described as a speculative bubble within either a single stock or sector of the stock market becomes diffused into the larger market.

Provided investors maintain their demand to own stocks, it can be a healthy development that reduces the concentration of the biggest companies within the market cap-weighted index. In that situation, the index itself goes through a brief decline before resuming an upward trajectory.

If that demand falls however, the index can decline because money is in effect leaving the market instead of being conveyed into the ownership of other stocks within it. That's the recipe for a crash that takes both the sector with the speculative gain and the rest of the market down with it. Much like what happened during the DeepSeek scare.

In the latest update of the alternative futures chart, we find the S&P 500's trajectory dipped, but remains well within the redzone forecast range. This outcome indicates the deflation of speculative gains in the AI sector hasn't become a drag on the whole stock market.

There is, of course, more going on to shape investors' outlook for the businesses whose stocks make up S&P 500 index. Here are the market moving headlines of the week that was:

Monday, 13 July 2026

• Signs and portents for the U.S. economy:
• Oil up 9% to one-month high as US says it will blockade entire Iranian coastline, all vessels
• Trump: Iran blockade reinstated, US to charge 20% on Strait of Hormuz cargo
• This one statistic reveals the AI job takeover has started
• Wall Street banks ramp up digital assistants in bid to win productivity race
• AI isn’t killing jobs at these companies — it’s boosting hiring
• Fed minion makes rate hike nearly a 50-50 possibility for July 2026:
• Fed's Waller says rate hike may be needed if core inflation stays hot
• Federal funds futures nearly split as Waller says he will consider a rate hike if inflation remains hot
• Bigger trouble, stimulus developing in China:
• China's GDP growth set to slow, raising expectations for more stimulus
• China June exports growth set to cool, but AI demand underpins overall strength - Reuters poll
• China's premier urges 'objective' understanding of the economy
• China aims to spur consumption in first five-year blueprint
• BOJ minions think higher growth on the way for Japan's economy as stimulus expected:
• BOJ may raise growth forecast, maintain vigilance to inflation risk, sources say
• Japan signals massive pension shift to domestic assets, sparking rally in yen, bonds
• Japan pension pivot seen as a slow burn, not a bond market fire sale
• ECB minions thinking about adding Eurocrypto as Eurozone currency:
• Explainer: Europe's digital euro: What it is and how it would work
• U.S. stocks end lower as chip stocks fall, U.S.-Iran tensions rise
• Wall Street retreats as renewed Middle East strife hits sentiment; chipmakers drop

Tuesday, 14 July 2026

• Signs and portents for the U.S. economy:
• Inflation eased more than expected in June as gas prices fell, CPI report shows
• US consumer inflation likely increased at a slow pace in June as gasoline prices retreated
• Here’s the inflation breakdown for June 2026 — in one chart
• Rate-Hike Odds Slump As US Consumer Prices Plunge Most Since COVID In June
• Traders expect Fed to skip July rate hike as inflation cools
• Oil prices rise 2% to one-month high as US-Iran attacks deepen supply disruption
• New chief Fed minion lays out U.S. monetary policy changes to Congress:
• Fed's Warsh: Committed to both inflation and employment mandates
• Warsh pledges Fed policy ‘regime change’ to rid inflation ‘tax’ on American people
• Warsh says markets to get ample notice to any Fed balance sheet changes
• Growth in China's exports paced by AI demand outside China, weak demand for loans within China:
• China's June trade tops forecasts buoyed by AI boom
• China tells some banks not to re-discount bills at rates below 0.5%, sources say
• S&P 500 and Nasdaq end higher on cool inflation data, solid bank earnings
• U.S. stocks advance after cooler inflation print, higher oil prices

Wednesday, 15 July 2026

• Signs and portents for the U.S. economy:
• US producer prices post largest drop in 14 months; inflation risks still tilted to the upside
• July Rate-Hike Off The Table After Producer Price Inflation Drops Most Since COVID
• Busiest US container port sets cargo record in June
• Oil prices make small gain on smaller US inventory draw
• Wall Street bank earnings surge, lifted by trading and investment banking
• Wall Street's investment banking machine firing on all cylinders
• Fed minion reveals they're not really paying attention to U.S. inflation data:
• Fed's Cook says she is prepared to act soon if inflation does not begin to slow
• Another minion sees the writing on the wall:
• Fed's Williams: "Unquestionably too-high" inflation may soon subside
• Fed minions thinking about revamping their own inflation measure:
• Revamp of 'core' PCE measure could help Fed estimate underlying inflation, research says
• Bigger trouble developing in China:
• China's second-quarter economic growth cools to 3-1/2-year low as imbalances worsen
• VIEW China's second-quarter economic growth misses market forecast
• China new home prices fall at slower pace, but recovery doubtful
• China's rare earth curbs endanger $6.5 trillion of Western industry, IEA says
• BOJ minions / Bigger trouble developing in Japan:
• Japan manufacturers stay upbeat on chip demand, services hit by costs
• ECB minions standing by for action:
• ECB policymakers take measured tone on price risks but urge vigilance
• ECB's Kocher sees currently no second-round effects from Iran war, but bank is ready to act
• Wall Street closes higher as the tech trade strengthens, wholesale inflation comes cooler
• Wall St ends higher on cool inflation data, strong earnings

Thursday, 16 July 2026

• Signs and portents for the U.S. economy:
• US pending home sales slump in June amid affordability challenges
• Lower gasoline prices restrain US retail sales, underlying momentum remains
• Oil settles lower, but remains near one-month high on U.S.-Iran tension
• Fed minions called out for policy flip-flops:
• As Fed Chair Warsh sticks to policy silence, colleagues voice their views
• Fed flip-flops make case for less talk
• Fed minions say they'll hike rates if inflation doesn't fall, don't seem to be aware of consumer, producer price indices:
• Fed may need to hike rates if inflation does not ease soon, Jefferson says
• Fed's Schmid: Inflation is "concerning" and the focus of setting policy right now
• Fed's Logan calls for 'modestly higher' interest rates
• Bigger trouble, stimulus developing in China:
• China's record consumer defaults undermine Beijing's push to boost spending
• Bigger trouble developing in Japan, BOJ minions getting excited to hike Japan's interest rates again, bail out Japan's currency again:
• Kuroda's negative rate surprise shocked his own BOJ board, minutes show
• Japan household inflation expectations rise, build case for BOJ rate hikes
• BOJ may face pressure to ramp up bond-buying if yields spike, ex-central bank policymaker says
• ECB minions standing by to hike Eurozone interest rates later:
• ECB to hold rates now but energy price resurgence points to September hike
• Euro zone yields rise, gap between German and US borrowing costs smallest in a month
• Wall Street closes in the red as tech stocks drag markets
• Wall Street ends lower as chip weakness offsets solid earnings, economic data

Friday, 17 July 2026

• Signs and portents for the U.S. economy:
• As US AI costs soar, global businesses pivot to China’s low-cost, open-weight models
• Oil rises on renewed US-Iran hostilities and threat of Red Sea closure
• US regional banks brush off war jitters with lending surge, fee boost
• Bigger trouble developing in and out of China:
• China's oil imports have plunged during the Iran war. How much will they recover?
• China's top airlines warn of heavy losses ahead of uncertain summer
• Inside the Chinese fraud rings stealing billio
• Chinese AI start-up Moonshot launches model challenging Anthropic’s lead
• Bigger trouble developing in Japan, BOJ minions standing by for action:
• Japan June core inflation seen at 1.6% on elevated energy prices: Reuters poll
• Yen likely to weaken past 170 before Japan's growth bet pays off, RSM's Brusuelas says
• Japan to leave monetary policy tools to BOJ in economic blueprint, document shows
• S&P 500 logs weekly decline as tech selloff weighs on markets
• S&P 500 closes lower, Nasdaq falls more than 1% as chip stocks suffer
• Chip stock weakness raises worries about AI rally-strength, leveraged trades
• U.S. stocks extend selloff led by semiconductors' global decline, Moonshot AI’s Kimi-K3
• Apple unseats Nvidia to become world's most valuable company as AI bets shift

The CME Group's FedWatch Tool now only sees one rate hike in its forecast range as having a greater than 50% probability of happening: a quarter point rate hike coming when the Fed meets on 16 September (2026-Q3). The FedWatch tool however still sees the potential for additional rate hikes in 2027.

The Atlanta Fed's GDPNow tool's estimate of real GDP growth for the U.S. economy in the current quarter of 2026-Q2 rebounded to +1.7% from the previous week's real growth estimate of +1.2%.

Image credit: Microsoft Copilot Designer. Prompt: "An editorial cartoon of a Wall Street bull who is shocked by the cost of their AI bill".

In the last decade, proof assistants have revolutionized how mathematicians establish whether a mathematical theory is valid. One in particular, called Lean, has risen to the forefront of the field. Its productivity-enhancing capabilities are behind several notable proofs that have been demonstrated in recent years. What's more, its integration with Artificial Intelligence technologies is contributing to a rapid pace of new advances in solving long standing but, until this year, unproven mathematical conjectures.

Much of that story is now being told in Kevin Hartnett's The Proof in the Code: How a Truth Machine Is Transforming Math and AI, which is proving to be an exceptionally well-timed book. It captures the short history of the rapid development of the Lean proof assistant, which is contributing to a revolution in how mathematicians do what they do. Hartnett's book is all the more remarkable because it doesn't require readers to have an extensive background in either mathematics or computer science to both follow the story and understand its significance.

And what a significant story it is. Here's a short summary of how Lean is aiding the advancement of mathematics:

• It can automate large parts of the process of verifying mathematical proofs.
• Its results are trustworthy. If a proof is validated in Lean, the proof will hold.
• Its library allows mathematicians to take advantage of proofs developed by their peers, using them as modular building blocks to help establish new proofs.
• It can handle very sophisticated proofs developed by the world's top mathematicians.
• It facilitates massive collaboration efforts among mathematicians and other contributors.
• It can be integrated with Artificial Intelligence (AI) technologies, such as reinforced learning techniques and Large Language Models, which can both improve its performance and the performance of the AI systems.

All of these things underscore the role of Lean as an amazing productivity enhancing software tool for its users. But it wasn't always that way. Perhaps even more remarkably, Lean didn't start out as a tool aimed at helping mathematicians.

As originally envisioned by Leo De Moura, who wrote several generations of its code, it was supposed to be a tool to help software developers find and fix bugs before they released software. A chance discussion with mathematician Jeremy Avigad in 2013 identified the potential of the code to aid mathematicians in developing their proofs, which ultimately set the direction of Lean in motion.

The rest of Harnett's story is how their efforts pulled in other key players who recognized its potential and worked through its development challenges to make it useful first, then to make it more and more capable.

For a story that involves many mathematicians and the math they were seeking to validate, Harnett keeps mathematical equations and symbols to a minimum. That's a vital requirement in making the story accessible to a general audience and showcases Hartnett's experience as a math writer. It's not until the later chapters of the book that mathematical statements begin appearing in the text, which are backed by plain language descriptions, which makes them very approachable.

Even more remarkably, the only example of Lean code that Hartnett presents is contained in the book's Appendix. The example is Lean's version of a 2,300+ year-old proof by Euclid that confirms there is always another larger prime number, which is to say that prime numbers extend into infinity.

If you only read one math book this year, this is the one to read. It's a fantastic introduction to some of the most advanced happenings going on in the world of maths and computer science and what is becoming possible today that hasn't been before. Highly recommended!

If you're interested in more discussion, Hartnett was recently interviewed by Breaking Math's Autumn Phaneuf and Noah Giansiracusa. Here's the video of the interview:

A bottom is now in for trade between the U.S. and China. It might even be *the* bottom for the global tariff war that began in April 2025 but only time will confirm that for sure.

What we do know for sure is that May 2026 saw the first increase in the rolling twelve month average of the value of goods exchanged between the U.S. and China for the first time since January 2025.

There are also indications that trade will continue to increase in the short term. A report out of China hints at what will be happening:

China-US goods trade totaled 2 trillion yuan ($294.1 billion) in the first half of the year, accounting for 7.9 percent of China's total foreign trade, with the second quarter rebounding to 13.7 percent growth after an 18.7 percent slump in the first quarter, a customs official said at a press conference on Tuesday in response to a question about the recent acceleration in Chinese exports to the US and the outlook for bilateral trade in the second half.

A Chinese expert said that the recovery of China-US goods trade in the second quarter, with bilateral trade turning positive after a decline in the first quarter, was mainly driven by improving trade relations and lower US tariff rates, which helped restore market confidence and support trade activity.

The apparent improvement is being acknowledged after President Donald Trump traveled to China to meet with Chinese leader Xi Jinping in May 2026. The relative truce between the two nations in their tariff war so far seems to be holding with Trump restraining trade hardliners in his administration for now.

Meanwhile, other news out of China this month points to a concrete reason behind why trade between the U.S. and China will continue to increase in the next few months:

Chinese exporters gained an advantage as U.S. retailers moved up their orders by four to six weeks to build inventory for Black Friday and Christmas sales ahead of anticipated tariff increases later this year.

Typically, goods shipped to support the Christmas holiday season in the U.S. peak in October 2026. Moving those shipments up by four to six weeks could move the annual seasonal peak to either August or, more likely, September 2026.

On the U.S. side of U.S.-China trade data, the following chart shows the uptick off a bottom for the trailing twelve month average of the value of goods exchanged between the U.S. and China in May 2026, with April 2026 representing a bottom (if not definitively yet *the* bottom):

That bottom also confirms our prediction from last month that "the level of trade between the U.S. and China will bottom in 2026-Q2. It may already have, but we won't get the data to confirm it for at least another month or two."

It looks like it had already happened at that writing!

References

U.S. Census Bureau. U.S. International Trade in Goods and Services (FT900). U.S. Trade in Goods with China, Not Seasonally Adjusted, Nominal Figures, Total Census Basis. [Online database]. Accessed 7 July 2026.

Image credit: A close up of Scrabble tiles spelling the words China, USA, and TariffsPhoto by Markus Winkler on Unsplash.

The dividend outlook of the S&P 500 (Index: SPX) had a mixed outcome for July 2026. Dividends expected to be paid in the now current quarter of 2026-Q3 are slightly lower than what had been anticipated in our June 2026 snapshot, but the farther future showed continued strength as expected dividends increased.

Here is our tally of how the expected future changed in the month from 15 June to 14 July 2026:

• 2026-Q2: Finalized at $20.72 per share (unchanged).
• 2026-Q3: Decrease of $0.09 to $21.13 per share
• 2026-Q4: Increase of $0.05 to $21.45 per share
• 2027-Q1: Increase of $0.18 to $22.75 per share
• 2027-Q2: Increase of $0.19 to $21.75 per share

The following chart shows how expectations for the S&P 500's quarterly dividends per share changed in the month from 15 June 2026 to 14 July 2026.

The initial estimate of dividends expected to be paid out to S&P 500 investors for the distant future quarter of 2027-Q3 is $21.92 per share.

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 to its end.

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 return of warm weather marks the end of soup season, and in 2026, it also marked the end of the big discounts that several grocery selling retailers were offering for Campbell's Tomato Soup in April.

Since then, prices for Campbell's second-best selling soup have risen at four of the ten major national and regional grocery stores and retailers that we track. Even so, the rolling twelve-month average price of a 10.75 fluid ounce can of Campbell's Condensed Tomato Soup declined in the three months since our previous snapshot, from $1.15 to $1.12 per can.

That's a consequence of the higher prices of early 2025 being replaced by the much lower sale prices of early 2026 in the trailing year average. Even though prices at some retailers have risen since our last snapshot, they are generally lower than what we recorded in early 2025.

Here are the prices we observed at our ten purveyors of Campbell's Condensed Tomato Soup and how they've changed since our April 2026 snapshot:

• Walmart: Increase of $0.28 to $1.28 (+28.0%).
• Amazon: Increase of $0.28 to $1.28 (+28.0%).
• Kroger: Increase of $0.50 to $1.50 (+50.0%).
• Walgreens: Unchanged at $1.99 (0.0%).
• Target: Unchanged at $1.29 (0.0%).
• CVS: Unchanged at $2.49 (0.0%).
• Albertsons: Unchanged at $1.49 (0.0%).
• Food Lion: Increase of $0.25 to $1.25 (+25.0%).
• H-E-B: Unchanged at $1.24 (0.0%).
• Meijer: Unchanged at $1.29 (0.0%).

The following chart presents the price history of Campbell's Condensed Tomato Soup in the 21st century, from January 2000 through July 2026:

Since 2022, the price of $1.00 has become the floor for an iconic can Campbell's Tomato Soup. Before 2022, that price level was the ceiling. For more history, you can find our collected price data extending back to January 1898 here.

Image Credit: Three Campbell's Tomato Soup Mugs on a Reflective Surface photo by Tina Morris on Unsplash.