Global Market Dispatch: Wall Street Hits Records, Oil Rebounds & Crypto Faces Regulatory Hurdles

Tuesday, August 4, 2026 | Daily briefing on Wall Street’s record surge, Hormuz oil volatility, Yen intervention aftermath, and Bitcoin’s regulatory cliff.

Daily Summary

• Wall Street hit records on strong manufacturing data. US manufacturing activity rose to a four-plus-year high in July, driving the Dow to a record close, while the S&P 500 rose 1.5% to 7,601 points and the Nasdaq surged 2.1% to 25,914 points. Amazon hit a new record high with a 4.6% gain, and Microsoft touched a year-to-date high with a 4.9% jump. Earnings season remains strong: about two-thirds of the S&P 500 has reported, with 84% beating expectations.
• Oil recovered after yesterday’s plunge, but diplomacy remains uncertain. Brent rose 1.3% to $84.89, and WTI climbed to $81.11; yesterday, Brent fell 7% to a three-week low. The Iranian Foreign Ministry denied Trump’s claim that ‘talks are ongoing,’ stating that no negotiations are taking place and no meetings are planned. ING views the sell-off as ‘excessive,’ noting: We have been in this situation many times before, and each time we thought things were resolved; Iran’s denial and Trump’s threats leave broad scope for a renewed escalation.
• The Yen weakened for the first time in five sessions. USD/JPY rose 0.3% to 157.72; the dust from the joint intervention is settling, but the yen remains 4% stronger compared to a week ago. Bessent confirmed the intervention aimed at preventing ‘disorderly yen movements’ and stated, ‘We will not hesitate to engage in another joint intervention if necessary.’ However, weak demand at the Japanese 10-year bond auction caused yields to spike again, with the 30-year yield approaching 4%.
• Bitcoin traded sideways around $63,400, while the monthly MACD remains bearish. The price is testing toward $64,000; even Strategy’s sale of 1,638 Bitcoins for $104.7 million was largely overlooked amid Clarity and Iran hopes. However, the monthly MACD has been on a sell signal since November and remains deep in negative territory; some analysts view this as a sign that the market has transitioned from an euphoric bull run to a prolonged distribution-correction phase. The monthly pivot stands at $64,200.
• The August 2024 nightmare is back on the table, but it may be different this time. US-Japan intervention has revived fears of a Yen carry trade unwind; in 2024, the BOJ’s surprise hike caused BTC to crash from $62,000 to $49,000 in a single week. BTC’s 52-week correlation with USD/JPY has reached -0.90, meaning BTC has actually been falling alongside a weak yen. The primary risk may not be the yen itself, but broad US dollar strength.
• Bernstein warns: If Clarity fails to pass, crypto will take another leg down. The brokerage argues that the bill’s failure to pass this year would trigger an immediate negative reaction in digital assets, but the downturn would be temporary as the SEC and CFTC accelerate rulemaking. Bernstein expects the decline to end in late Q3 or early Q4. JPMorgan similarly characterized the delay last week as ‘a blow to one of the industry’s biggest catalysts.’

Main Agenda

Wall Street at Records: Strong Manufacturing Data & Earnings Season

Markets started the week strong, driven by two positive developments. First, macro data: US manufacturing activity hit a four-plus-year high in July, pushing the Dow Jones to a record close. The S&P 500 rose 1.5% to 7,601 points, marking its highest close since June 2 and breaking above the 7,594 resistance level within a rectangle pattern to generate a technical buy signal; the Nasdaq Composite index jumped 2.1% to 25,914 points.

Second, earnings: roughly two-thirds of S&P 500 companies have reported, with 84% beating earnings expectations. Mega-cap tech leadership was prominent; Amazon surged 4.6% to $284 to set a new record high, breaking above the $275 resistance to signal further upside. Microsoft gained 4.9% to $488, reaching a year-to-date peak and extending its weekly gain to 25.3%, while Alphabet climbed 4.9% to $374.

However, there is a note of caution: despite Microsoft’s record single-day surge, its medium-term technical trend is still assessed as weak, meaning a single-day bounce does not alter the structural picture.

In Asia today, the picture is more mixed; while S&P 500 futures trade near records, the Nikkei fell 0.3% and the MSCI Asia index edged lower. Earnings are expected today from SpaceX, AMD, Caterpillar, McDonald’s, and Pfizer, alongside four US and European indices marching toward record highs.

Iran Denies Talks: Oil Recovers, Uncertainty Persists

The diplomatic hope that drove oil lower yesterday turned into uncertainty within a single day. Trump stated on Sunday that talks with Iran were ongoing and that the dispute over control of Hormuz was being resolved; this sent Brent down 7% to a three-week low. However, Iranian Foreign Ministry Spokesman Esmail Baghaei rejected Trump’s claim on Monday: no negotiations are taking place with the US, and no meetings are planned.

This denial pushed oil into a recovery on Tuesday; Brent rose 1.3% to $84.89, and WTI increased 1% to $81.11. ING views the scale of the sell-off as exaggerated: given the significant remaining uncertainty, the scale of the drop looks excessive; we have seen this situation play out repeatedly, and each time it felt like things were resolved. Iran’s denial of the talks and Trump’s warning of consequences if no deal is reached leave room for renewed escalation.

Washington asserts that the June agreement requires Iran to keep the strait open, while Tehran maintains that the text explicitly preserves its own authority. On Tuesday, the UK Maritime Trade Operations agency reported that a cargo ship was hit by an unidentified projectile northeast of Al Khasab, Oman. According to Barclays, net exports through Hormuz rose to 4.2 million barrels per day during the week of July 31 (up from 3.2 million the previous week), indicating a partial recovery in flows.

The Saudi-Houthi conflict has not completely halted energy flows, but it has led to longer transit times, higher insurance costs, and occasional rerouting; together with Hormuz, this keeps the risk alive, preventing the market from giving back the geopolitical premium on oil entirely.

Carry Trade or Dollar Strength?

The joint US-Japan intervention has revived memories of a trauma from two years ago in the crypto market. Treasury Secretary Bessent confirmed that the US joined Japan last Friday to prevent ‘disorderly yen movements’; USD/JPY approached 164—its weakest level since 1986—before pulling back to 156.5. Bessent noted that ‘we will not hesitate to engage in another joint intervention’ and added that the US strongly supports Japan’s decisive steps to correct the significant undervaluation of the yen.

For crypto, August 2024 represented a slaughter: when the BOJ unexpectedly raised rates to 0.25% that month, the yen strengthened and BTC crashed by roughly 20% in a week, dropping from around $62,000 to $49,000 as leveraged carry traders dumped risk assets to cover yen-denominated losses.

While many expect Bitcoin to drop alongside a strengthening yen, the data suggests the opposite: BTC’s 52-week rolling correlation with USD/JPY has reached -0.90, meaning Bitcoin was actually falling alongside a weakening yen—the exact opposite of the carry trade logic. According to the analysis, the real driver was broad dollar strength rather than the yen itself.

This distinction matters because in the current backdrop, the dollar is weak (with the index near two-month lows at 99.99), which under carry trade logic should be bullish for Bitcoin. However, Japanese bond yields continue to climb despite intervention; the 30-year yield is approaching 4%, while Bitcoin remains relatively flat above $63,000. The next major move in the yen could ultimately be upward, making the BTC-yen dynamic a critical monitoring point for crypto.

Clarity Act: Bernstein Warns of ‘Another Leg Down’

The clock is ticking on crypto regulation, and Wall Street has begun pricing it in. Brokerage firm Bernstein argued in a note on Monday that failure to pass the Clarity Act this year will trigger a new wave of selling in crypto markets, though US regulators would likely respond by accelerating rulemaking. According to analysts, the likelihood of the bill passing has deteriorated as time narrows before the Senate recess.

In the note’s words, Clarity is the most important crypto market structure legislation in US history, but the probability of its passage in 2026 is steadily shrinking. A failure to pass would create an immediate negative reaction across digital assets, but the setback would likely be temporary, as the SEC and CFTC expand rulemaking under the Trump administration’s Project Crypto initiative.

Bernstein expects regulators to move faster on token classifications, DeFi guidance, custody rules, and innovation exemptions for token issuance, projecting that the current downturn will end in late Q3 or early Q4 on expectations of additional policy support from the White House.

JPMorgan issued a similar warning last week, calling the weakening prospects of the bill passing the Senate ‘a blow to one of the industry’s largest regulatory catalysts.’ If the Senate enters recess this week without holding a procedural vote, the bill could potentially re-emerge upon return in September, though it remains uncertain; this will serve as an ongoing source of uncertainty hanging over crypto throughout August.

Macro Framework

Dollar at Two-Month Lows; Employment Week to Set the Tone

The dollar index sits near two-month lows at 99.99, having lost over 1.5% last week amid yen intervention, dropping oil prices, and Warsh’s dovish stance. Meanwhile, the yen weakened for the first time in five sessions: USD/JPY rose 0.3% to 157.72, though it remains roughly 4% stronger against both currencies compared to a week ago prior to the intervention.

Pressure continues to build on Japanese bonds; yields spiked again on Tuesday after a 10-year auction saw weaker demand than the previous sale. The Euro trades near a one-and-a-half-month high at $1.1559, while Sterling holds near two-week highs.

The key data point of the week is Friday’s non-farm payrolls report; New York Fed President John Williams maintained optimism on Monday that inflation pressures would gradually abate, while noting the Fed would not hesitate to raise rates further if they do not. Markets continue to price in a 65% probability of a rate hike in September.

There are two inflation and two employment reports scheduled before the September FOMC meeting; this week brings JOLTS (today), ADP (Wednesday), and non-farm payrolls (Friday) in sequence. A resilient labor market or stalled disinflation could increase pressure on the Fed to reinforce its inflation-fighting credibility.

Gold Consolidates; Citi Targets $4,500 in Q4

Precious metals are trading in a tight range amid mixed signals on Iran and anticipation surrounding employment data. Gold rose 0.2% to $4,062; Kedia from Kedia Commodities notes that the metal is in a consolidation phase and that signs of weakness in the labor market would weigh on the dollar and lift gold. A easing of September rate hike bets would also support the metal.

Citi released a striking forecast: gold may stagnate or even pull back over the coming month, but it projects a rise to $4,500 in Q4 and $5,000 in the first half of next year. This demonstrates that a structural bullish outlook on gold remains intact even as the war premium fades.

Silver rose 1.2% to $58.89, platinum gained 0.9% to $1,642, and palladium climbed 0.9% to $1,276. Among industrial metals, copper remains strong near $6.50, close to its 52-week highs, supported by robust manufacturing data.

Oil stabilization and dollar weakness will be key determinants for gold going forward; TD Securities’ scenario of ‘$3,900 if oil stays high’ versus Citi’s $4,500 target present two opposing paths tied to the direction of oil.

Crypto

Bitcoin at $63,400: Monthly MACD Warning & Solana Supply Proposal

Bitcoin is trading relatively flat around $63,400 while testing toward $64,000; Ether fell 0.5% to $1,857. Prices are being driven by optimism surrounding the Clarity Act and Iran talks, which have overshadowed Strategy’s sale of 1,638 Bitcoins for $104.7 million. As noted last week, there was a significant leveraged short position tied to Bitcoin, which could fuel a relief bounce toward $64,000 until reversed.

The monthly pivot lies at $64,200, making tests around this level normal before a clearer directional move emerges. However, intra-day price action shows a lack of buying enthusiasm: open interest data indicates limited motivation to push BTC above $64,000; the daily options pivot sits at $63,300, with significant high-leverage liquidations clustered around $62,550.

The primary warning comes from the monthly chart: the monthly MACD has been on a continuous sell signal since November and currently sits deep in negative territory. Although the indicator has turned decisively negative, history shows that major Bitcoin cycle bottoms rarely form immediately after the initial monthly cross; they typically develop after an extended period of negative momentum, as downward pressure gradually exhausts and the MACD flattens before eventually turning upward.

Interestingly, the orange signal line remains well above the zero mark even while the histogram is deep negative, which typically reflects a market transitioning from an euphoric bull market into a prolonged distribution and correction phase rather than one that has completed its reset process. The technical picture implies it is still early to call a bottom.

For Bitcoin, the near-term catalyst will depend less on internal dynamics and more on Friday’s employment data alongside overall risk appetite shaped by the Clarity timeline.

Commodity Environment

Oil Recovers: Dual Chokepoint Risk Preserves Premium

Oil recovered over 1% on Tuesday following yesterday’s sharp sell-off, with Brent rising to $84.89 and WTI climbing to $81.11. The recovery is driven by the fact that a diplomatic solution remains distant and supply risks persist. Iran’s denial of talks reinforced the view that yesterday’s drop went too far.

Technically, Brent approached its 200-day moving average during yesterday’s drop but held above it; WTI remains around $80, noticeably above pre-war levels.

The key element in the equation is dual chokepoint risk: as Waterer highlighted, while the Saudi-Houthi conflict has not entirely stopped energy flows, it has created longer transit times and higher insurance costs; together with Hormuz, this prevents oil from fully unwinding its geopolitical premium.

Physical data confirms this: six Saudi-flagged supertankers in the Gulf of Aden rerouted around southern Africa, though two Saudi crude-laden tankers did transit Bab el-Mandeb; overall traffic through Hormuz and Bab el-Mandeb remained largely unchanged at the start of the week. This points to neither a full blockade nor complete normalization; the market is pricing within this uncertain balance.

The 188,000 barrel-per-day production increase approved by OPEC+ yesterday provides a minor easing on the supply side. The $80–$100 range framework outlined last week remains valid; prices currently trade in the lower half of the band, with direction set to be determined by ongoing Trump-Iran developments. Despite Iran’s denial, Trump’s ‘last chance’ warning serves as a reminder that escalation remains on the table.

Equities

Record Close: Carried by Manufacturing Data and Earnings, Catalyst Questions Remain

Wall Street logged a strong record close on Monday, driven by two catalysts: the strongest manufacturing reading in four years and ongoing strength in earnings season. The S&P 500 gained 1.5% to 7,601 points, breaking above resistance at 7,594 to generate a buy signal targeting 7,833 points within two months; the SPDR S&P 500 ETF cleared resistance at 752, giving a three-month target of $785.

Mega-cap tech set new records: Amazon hit an all-time high of $284, Microsoft touched a year-to-date peak of $488, and Alphabet reached $374.

However, two areas warrant attention. First, despite strong single-day gains, certain technical indicators suggest caution; Microsoft’s medium-term trend is still assessed as weak despite the record day. Second, the question of upside catalysts: Horneman’s warning from Verdence remains relevant—with major tech earnings now mostly in the rear-view mirror, a clear new catalyst to drive markets higher from here is lacking, making Friday’s employment data the primary directional driver.

Asia presents a mixed picture this morning: the KOSPI recovered 2.1% today after falling 5% yesterday, while the Nikkei fell 0.3%; volatility in Korea continues to show signs of leverage unwinding. European futures are marching toward record levels.

Today’s earnings schedule is busy: SpaceX and AMD (with SpaceX’s Bitcoin holdings and AMD’s AI positioning relevant for crypto), along with Caterpillar, McDonald’s, Pfizer, and BP.

Another notable event is taking place at the White House: following security breaches involving AI agents, executives from Meta, Anthropic, OpenAI, and Google are meeting today to discuss voluntary government safety testing for their most advanced models. The direction for the week will hinge on Friday’s employment data and its implications for the September rate decision.

Weekly Calendar

Date	Day	Event / Release
Aug 4	Tuesday (Today)	June US JOLTS Job Openings; France June Budget Balance; Germany 2-yr & UK 6-yr Bond Auctions
Aug 4	Tuesday (Today)	Earnings: SpaceX, AMD, Caterpillar, McDonald’s, Pfizer, BP, Lufthansa; White House AI Safety Testing Meeting (Meta, Anthropic, OpenAI, Google)
Aug 5	Wednesday	US ADP Non-Farm Employment Change; ISM Services PMI; SanDisk Earnings
Aug 6	Thursday	US Weekly Initial Unemployment Claims; Palantir Earnings
Aug 7	Friday	US July Employment Report — Consensus ~88k (June 57k), Unemployment at 4.3%; Binary risk event for BTC
Aug 8	Saturday	US Senate enters Summer Recess — Final window closes for the Clarity Act
Aug 12	Wednesday	US July CPI — Key input for the September Fed decision (Current September hike probability: 65%)
Aug 18	—	Solana SIMD-0550/0553 Signal Deadline — Needs 40M SOL more to hit the 15% threshold