Week ended July 10, 2026: stocks and bonds diverge (again)

"Nowhere does history indulge in repetitions so often or so uniformly as in Wall Street. When you read contemporary accounts of booms or panics the one thing that strikes you most forcibly is how little either stock speculation or stock speculators to-day differ from yesterday. The game does not change and neither does human nature."

From Reminiscences of a Stock Operator (2025 Annotated Edition): An In-Depth, Chapter-by-Chapter Analysis for the Modern Speculator by Edwin Lefèvre

The quote above, written in 1923, is one for you to ponder as investors continue to unabashedly strap on risk.  Equities, certainly Stateside, continue to grind higher.  “How much more” and “how much longer” are the questions that many investors and pundits are asking, especially as valuations are stretched and volatility in some sectors (look no further than semi-conductors) is reaching unprecedentedly high levels.  It’s no use beating this dead horse any more than I have already, so the only reasonably intelligent advice I can offer is “you gotta be in it to win it”.  One day, it will crack though – history guarantees it. 

Themes last week: bring on the risk, investment grade bond supply

Last week was characterised by similar themes that have been around for weeks, with stock investors absorbing most blows rather nonchalantly.  Not even a (re)escalation of the US-Iran conflict leading to higher oil prices could curb enthusiasm for risk, although things are starting to feel slightly different in the bond market. 

Yields remain under pressure across the US Treasury curve, slightly more pronounced at the intermediate and longer end of the curve.  Also, there is clearly pressure building in the corporate bond market, more supply- rather than macroeconomic-related.  And strangely, most of the stress is in the investment grade bond market (rather than the more credit-sensitive high yield market), as recent one-after-another mega-bond issues tests the capacity of investors.  For example, last week Amazon issued an eight-part $25 billion bond issue with maturities ranging from three to 40 years, and reportedly had to pay higher spreads to get the issue away.  And just after its IPO, SpaceX had little trouble raising $25 billion in a multi-tranche bond issue, with all tranches (as I have read) trading below par.  How a company losing so much money can garner an investment grade rating and then sell so much debt is remarkable to this old-timer. 

As you might know, hyper-scalers have been some of the most prolific issuers as these companies raise financing to meet their needs for data centre buildouts.  Before its most recent issue, AMZN sold $54 billion of bonds in March 2026, META raised $30 billion in October 2025, GOOG has raised over $60 billion equivalent in the last six months in two separate multi-currency issues, and NVDA raised $25 billion in June, their first bond issue since 2021.   The only hyper-scaler absent from gorging on debt has been MSFT, one of only two triple-A rated corporates in the U.S.  The A.I. trade is real, but capacity across a number of fronts – one being financing – will certainly be tested in the weeks and months ahead.

SK Hynix ADRs listed

On Thursday, South Korean chip maker SK Hynix sold $26.5 billion in ADRs (American Depository Receipts, issued by foreign companies and backed by their domestic listed stock).  This is the largest foreign listing ever in the U.S. market.  The stock has been highly volatile in its domestic market, with the shares ranging in value from ₩245,000 to ₩2,987,000 in the last 52 weeks (yes, you are reading this correctly).   However, the stock has more than tripled this year as semi-conductor demand has accelerated and continues to grow, thanks to investment in data centres and the evolution of A.I.  The IPO price was $139/share, and the stock closed on Friday – its first day of trading – at $168.01/share.  If you want to learn more about the semi-conductor industry from a layman (me), then check out the article on my website Semi-conductors: the value chain and exploring the opportunity.

Revised World Bank Economic Projections and FOMC Minutes

The World Bank provided updated global economic projections last week, which you can find here.  The two-page Executive Summary is here.  In a nutshell, the World Bank revised global economic growth down and long-term headline inflation up in 2027 because of higher oil prices related to the conflict in the Middle East.

Minutes from the last FOMC meeting (June 16-17) were released last week, and you can find them here. There were no real surprises, with committee members expressing concerns about long-term inflation risks, and the committee divided on the likely path of future interest rates. 

What’s ahead

This coming week, investors will be focused mainly on some relevant economic data, mostly in the US, and the start of earnings season for the quarter ended June 30, 2026.

US economic data to be released next week includes: June CPI (Tuesday), June PPI (Weds), June retail sales (Thurs) and the latest consumer sentiment data (Friday). 

Earnings also kick off with the major US banks reporting, along with several benchmark names in other sectors.  The table below provides some of the earnings releases in the coming weeks that most interest me.

The following week, we begin a series of important central bank meetings, starting with the ECB on July 23 and followed by the Fed, the BoE and the BoJ in the second half of the last week of July:

• European Central Bank (ECB): July 22-23

• FOMC (Fed): July 28-29

• Bank of England: June 30

• Bank of Japan: July 30-31

MARKET DATA AND TABLES

Below are tables of key indices and asset prices that have been updated for the past week. 

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