Market Outlook – Week Ahead (20‑07‑2026)
The week’s agenda is dominated by a cluster of high‑profile U.S. technology earnings, heightened Middle‑East geopolitical risk, a key U.S. PMI flash release, a scheduled SpaceX Starship test flight, and the European Central Bank’s upcoming rate decision.
Tech earnings – Alphabet (Google‑owner) will publish its quarterly results after the U.S. market close on Wednesday, followed by Intel and Texas Instruments, which will reveal the health of the semiconductor supply chain that underpins the AI boom. Tesla is also slated to report, alongside American Express and defense contractor RTX. Analysts expect these filings to shed light on whether the massive AI‑related capital spending remains sustainable after a recent pull‑back in chip‑related valuations.
Middle‑East tensions – Fighting between the United States and Iran has intensified, jeopardising the fragile cease‑fire and the future of the Strait of Hormuz, a critical oil‑shipping lane. Brent crude has risen back above $90 a barrel after briefly topping $110 during the early phase of the conflict, underscoring the market’s sensitivity to any escalation.
U.S. PMI data – A flash reading of the S&P Global Purchasing Managers’ Index for July will be released on Friday. The June composite PMI stood at 52.2, signalling overall expansion, buoyed by a services‑sector surge linked to the FIFA World Cup hosted jointly by the United States, Canada and Mexico. Manufacturing activity has risen for a fourth consecutive month as firms rebuild supply buffers amid potential shortages and higher prices stemming from the Iran war.
SpaceX Starship test flight – SpaceX announced that it aims to launch the thirteenth Starship test flight as early as Thursday. The mission will target a successful launch, ascent, stage separation, boost‑back burn and landing‑burn at an offshore point, carrying Starlink V3 satellites. The previous week’s flight was aborted minutes before launch due to engine non‑ignition, and the 12th flight also suffered engine issues that prompted a Federal Aviation Administration investigation. SpaceX shares, which had slipped below the IPO price, rose more than 1 % in extended‑hours trading following the announcement.
ECB decision – The European Central Bank is expected to keep policy rates unchanged at its meeting later this week, but investors will scrutinise any forward guidance. In June, the ECB raised rates by 25 basis points, warning that the energy shock from the Iran war could fuel inflation. Eurozone price growth now hovers around 3 %, well above the ECB’s 2 % target, raising concerns that wage demands could trigger a price‑wage spiral. Analysts at ING note a risk that the ECB could seize the moment of higher energy prices to deliver a surprise rate hike before the scheduled September move.
Key figures – Brent crude > $90/bbl (peaked > $110); June composite PMI 52.2; Eurozone inflation ~3 %; ECB June rate hike 25 bps.
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