U.S. markets face oil surge, bank earnings kickoff

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U.S. markets, oil surge & earnings

Highlights

WTI crude oil surges over 3% to above $74 a barrel following renewed U.S.-Iran conflict and uncertainty regarding the Strait of Hormuz.
Large U.S. banks including JP Morgan, Goldman Sachs, Citigroup, Wells Fargo, and Bank of America open earnings season Tuesday, with market attention on management guidance for revenue and bad-loan write-offs.
Taiwan Semiconductor posts record early results, with revenue up 35.5% to $74.99 billion, driven by sustained artificial intelligence demand.

Market drivers this week

As reported by Cboe Global Markets, markets are focusing on a sharp rise in crude oil prices, the opening of second-quarter earnings season and several economic releases that could shape sentiment in the days ahead.

The conflict involving the U.S. and Iran intensifies over the weekend, with both sides carrying out airstrikes. It remains unclear whether the Strait of Hormuz is open to commercial traffic, with the U.S. saying it is open and Iran saying it is not. WTI crude oil, which is mostly falling last week, climbs more than 3% and moves above $74 a barrel in early trading.

Early trading in equities is subdued. The S&P 500 slips 0.02%, the Nasdaq Composite falls 0.87%, and the Dow Jones Industrial Average adds 0.21%. Investors are also watching the Consumer Price Index on Tuesday, the Producer Price Index on Wednesday and weekly jobless claims on Thursday.

Bank results and technology stocks in focus

Large U.S. banks officially open earnings season on Tuesday, with JP Morgan, Goldman Sachs, Citigroup, Wells Fargo and Bank of America due to report before the bell. Morgan Stanley follows on Wednesday, alongside Johnson & Johnson, while Thursday's lineup includes Taiwan Semiconductor, United Healthcare and Netflix.

Wall Street is largely expecting solid second-quarter growth from the major banks, and investors are listening for management commentary on revenue trends and bad-loan write-offs as signals on consumer spending and financial health. Comments from JP Morgan chief Jamie Dimon are also likely to influence market sentiment.

Taiwan Semiconductor reports record early results ahead of its full release later this week, posting a 35.5% rise in revenue to $74.99 billion and highlighting continued demand tied to artificial intelligence. Apple is also in focus after pursuing a lawsuit against OpenAI and one of its executives over alleged theft of trade secrets, a claim the Wall Street Journal reports.

Last week, all three major U.S. indexes end Friday higher, although the Dow breaks a four-week winning streak on a weekly basis. In chips, SK Hynix retreats in Seoul and in early U.S. trading after its recent market debut, while Sandisk, Western Digital, Micron, Intel and Qualcomm are also under pressure.

Our earlier coverage of the escalating U.S.–Iran confrontation in and around the Strait of Hormuz explained how renewed strikes and retaliatory operations heightened risks to commercial shipping through this critical energy corridor. We noted that conflicting claims about whether the waterway remained open helped fuel a spike in crude prices and weighed on broader risk sentiment.

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