Preview of US Stock Market | Three major stock index futures rise together, most technology stocks are on the rise. Technology giants are in a "wait-and-see" mode on the eve of their financial reports.

Pre-market market trends 1. Pre-market on July 21 (Tuesday), the futures of the three major US stock indices all rose. As of the latest information, Dow futures rose 0.28%, S&P 500 futures rose 0.49%, and Nasdaq futures rose 1.42%. 2. As of the latest information, Germany's DAX index rose 0.13%, the UK's FTSE 100 index rose 0.16%, France's CAC40 index rose 0.06%, and the European Stoxx 50 index rose 0.52%. 3. As of the latest information, WTI crude oil rose 1.13% to $83.41 per barrel. Brent crude oil rose 1.19% to $90.28 per barrel. Market news Tech giants on the eve of earnings reports: US stocks enter a "wait-and-see mode", oil prices and AI are waiting to be dismantled. On the eve of the earnings reports of tech giants that investors around the world are eagerly awaiting, the US stock market is facing a double blow of political risks from GEO Group Inc and a revaluation of AI valuations. Analyst Damir Tokic pointed out that the current market is being dominated by two major themes - inflation driven by oil prices and AI trading. Tech stocks are continuing to be in a cautious "wait-and-see mode" ahead of key earnings reports. Tokic said, "Currently, the tech sector is in a state of wait-and-see, while other sectors are experiencing selling pressure. And under the dual pressure of rising oil prices and approaching tech earnings, the downside risk to the S&P 500 index should not be overlooked." Alphabet Inc. Class C's second-quarter earnings report released after the US market on Wednesday will be a key indicator for AI trading. Tokic pointed out that any signs of a halt in AI capital expenditure could accelerate what he calls the "AI bubble burst" - a expectation that is already priced into semiconductor stocks. JP Morgan CEO Damon "pours cold water": Investors underestimate global risks, will not buy US stocks or long bonds at current prices. Jamie Dimon, CEO of JPMorgan Chase, said investors underestimate the risks facing the global economy, and at current price levels, he would not buy stocks or long-term US Treasuries. Dimon said the market has not fully reflected the increasing political and fiscal threats from GEO Group Inc. When asked if the market underestimated the possibility of a major shock occurring, Dimon said it is difficult to know exactly what risks are already priced into asset prices. He said, "Some factors may have been digested, but what will actually happen cannot be digested in advance." In addition to US Treasuries, Dimon also takes a cautious stance on stocks. While he would consider buying a stock if it is "a great investment," Dimon said he wouldn't buy into the broader market at current valuations. UBS Group AG trading department: Selling of momentum stocks nearing an end, it's time to gradually build positions in AI and semiconductors. According to data from the main brokerage business of UBS Group AG, hedge funds have reduced their long positions in momentum stocks and semiconductor stocks by about 5% of the total market value, one of the largest declines in history. Currently, net positions of semiconductor and software stocks have fallen to the levels of April this year. Michael Romano, head of stock derivatives sales at UBS Group AG, said in a report to clients that although there has been a recent pullback, the fundamentals of the AI sector are still improving, providing a basis for "buying on the dips." However, he advises investors to gradually build positions rather than rushing in all at once. Momentum strategies typically involve buying strong stocks and shorting weak ones. He expects the deleveraging process of momentum stocks to bottom out by the end of July - even if it has not yet reached a bottom, it is nearing a low point. Breaking the 19-week mark in delivery and the largest monthly price increase, will "chip inflation" be the next "life or death" test for AI trading? Recent reports from investment firm Susquehanna suggest that the delivery cycle of the global semiconductor industry extended further in June, with prices increasing significantly even against a backdrop of rising prices. Analyst Christopher Rolland pointed out that the delivery time for the semiconductor industry in June saw the largest single-month increase in this cycle, rising by 5 days to 19.4 weeks. More notably, industry pricing saw the "largest single-month increase" in June, rising by 5% month-on-month. With the acceleration of delivery times and rising prices, it is evident that the supply-demand situation for chips is continuing to tighten. Behind the recent dramatic fluctuations in chip stock prices, the simultaneous acceleration of delivery times and rising prices seems to suggest a deeper structural contradiction is emerging - "chip inflation". Julia Hermann, global market strategist at New York Life Investment Management, recently warned that "chip inflation" - the soaring prices of logic chips and storage chips related to AI - will be the next headwind to test the resilience of AI trading. In her view, while rising chip prices are a sign of strong demand, they also present a double-edged sword - continuously rising prices will significantly increase the costs of building AI infrastructure, which in turn could curb or even end the current AI capital spending boom. HSBC strategist warns: US stocks may face a correction risk before the midterm elections, investors should consider reducing positions after the earnings season ends. Max Kettner, Chief Multi-Asset Strategist at HSBC HOLDINGS, said stock investors should consider reducing some positions after the end of this earnings season. He warned that overheated market sentiment, diminishing fiscal stimulus effects, and the uncertainty brought by the US midterm elections could trigger a stock market correction. Kettner, who has maintained a "maximum overweight" stance on stocks since mid-March, said that current market positions and investor sentiment are approaching the levels seen during the 2021 economic recovery rally, and some US credit card consumption data has shown signs of slowing consumer spending. He pointed out that the scale of fiscal stimulus brought by the "BEAUTIFUL Act" is equivalent to that of stimulus measures during the 2009 financial crisis, but the stimulus effects are mainly concentrated in the first half of 2026, which means that future additional fiscal support will be very limited. Kettner said in an interview, "I think that before the midterm elections, about a month to a month and a half after the earnings season ends, it might be time to slightly ease off the accelerator and reduce stock positions appropriately." Goldman Sachs Group, Inc. issues extreme oil price warning: If "global oil artery" continues to be blocked, Brent oil may break $120 in Q4. Goldman Sachs Group, Inc. issued a heavy report warning that if the disruption in the Hormuz Strait's shipping continues, Brent crude oil prices may break $120 per barrel in the fourth quarter of 2026. Goldman Sachs Group, Inc. outlined two radically different paths for the oil market. Goldman Sachs Group, Inc. also pointed out that the risks of the forecast are "tilting upward" due to the disruption in shipping in the Hormuz Strait and threats to the shipping routes in the Red Sea. The baseline scenario is assumed to be a gradual easing of tensions in the Middle East, with Goldman Sachs Group, Inc. expecting an average Brent crude oil price of $80 per barrel in the fourth quarter of 2026. The risk scenario is that if shipping in the Hormuz Strait continues to be disrupted, Goldman Sachs Group, Inc. warned that Brent crude oil prices could break $120 per barrel in the fourth quarter; in a more extreme case, if the disruption continues until 2027, oil prices may even reach $140 per barrel. Individual stock news Tech stocks on pre-market are rising. On Tuesday pre-market, as of the latest information, Sandisk (SNDK.US), Western Digital Corporation (WDC.US) rose over 7%, Micron Technology, Inc. (MU.US), Seagate Technology Holdings PLC (STX.US) rose nearly 6%; Intel Corporation (INTC.US) rose nearly 6%, AMD (AMD.US) rose over 4%, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US), ASML Holding NV ADR (ASML.US), Broadcom Inc. (AVGO.US) rose over 3%, Qualcomm (QCOM.US) rose over 2%, SpaceX (SPCX.US), NVIDIA Corporation (NVDA.US) rose over 1%; Coherent (COHR.US) rose over 7%, AXT Inc (AXTI.US) rose over 6%, Credo Technology (CRDO.US), Lumentum (LITE.US), Astera Labs (ALAB.US), Marvell Technology, Inc. (MRVL.US), Corning Inc (GLW.US) rose over 5%, Nokia Oyj Sponsored ADR (NOK.US) rose nearly 4%. General Motors Company (GM.US) exceeds expectations in Q2 earnings, raises full-year guidance. The financial report shows that General Motors Company's Q2 revenue increased by about 2% year-on-year to $48.03 billion, better than the market's expected $47.01 billion; adjusted operating profit was $3.9 billion, better than the market's expected $3.7 billion; adjusted earnings per share were $3.57, better than the market's expected $3.19. For the full year, General Motors Company currently expects full-year operating profit to be between $14 billion and $16 billion, higher than the previously expected $13.5 billion to $15.5 billion; it expects full-year adjusted earnings per share to be $12 to $14, up from the previously expected $11.5 to $13.5. Although the overall impact of tariffs is still significant, General Motors Company has had a year to offset related costs. General Motors Company estimates that, without considering any offset measures, the impact of tariffs for the full year in 2026 will be about $3 billion. As of pre-market, General Motors Company rose over 1% in Tuesday's pre-market. Strong sales of innovative drugs offset the impact of generic drugs! Novartis AG Sponsored ADR Pharma (NVS.US) beats expectations in Q2, signaling a return to growth. Novartis AG Sponsored ADR Pharma released better-than-expected second-quarter results. The strong performance of new generation cancer drugs offset the impact of generic drugs on the blockbuster heart drug Entresto, signaling the company's return to a growth trajectory. The financial report shows that Novartis AG Sponsored ADR Pharma's second-quarter sales increased by 3% year-on-year to $14.408 billion, better than analysts' average expectations of $14.042 billion; sales growth was mainly driven by a series of innovative drugs. Core operating profit was $5.94 billion, better than analysts' average expectations of $5.34 billion; core earnings per share was $2.41, also better than analysts' average expectations of $2.13. Vas Narasimhan, CEO of Novartis AG Sponsored ADR Pharma, is focusing on developing a strategy for the growth of innovative drugs this year. As former blockbuster products, including the heart disease drug Entresto, experienced sales declines due to the impact of generic drugs, and enough new drugs have not fully taken over to drive growth, the company is facing pressure from patent cliffs. However, some analysts have suggested that last quarter may have been the most severe period of the patent cliff impact for Novartis AG Sponsored ADR Pharma. As of pre-market, Novartis AG Sponsored ADR Pharma rose over 4% in Tuesday's pre-market. Halliburton (HAL.US) exceeds expectations in Q2 earnings, but sharp decline in sales in the Middle East drags down stock price. The financial report shows that Halliburton's Q2 revenue increased by nearly 4% year-on-year to $5.71 billion, better than the market's expected $5.5 billion; adjusted earnings per share were $0.55, better than the market's expected $0.54. Both the company's Completion and Production division and its Drilling and Evaluation division saw growth. The company's CEO Jeff Miller said the company has strong business opportunities in international markets and saw encouraging signs of recovery in the North American market in the second quarter. However, the oilfield services giant suffered a sharp decline in sales in the Middle East region. The company said sales in the Middle East and Asia region fell by 10% year-on-year to $1.3 billion, mainly due to reduced business activities in markets like Kuwait, Iraq, and Qatar as a result of the ongoing tensions between the US and Iran. As of pre-market, Halliburton fell over 4% in Tuesday's pre-market. As demand for AI surges, costs skyrocket! Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR (TSM.US) reportedly planning to raise prices by up to 10% in 2027. According to reports citing sources familiar with the matter, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR has started discussions with customers and plans to raise chip manufacturing prices by up to 10% in 2027 to cover the rising production costs. The report states that Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR started negotiations in June and finalized a price increase plan this month, ranging from 5% to 10%. The price adjustments will take effect next year, covering advanced process chips and mature process chips. Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR and other chip manufacturers are facing pressures of skyrocketing costs in the production process, including materials, equipment, and electricity costs. According to reports, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR delayed the price increase to 2027 to give customers time to adjust. For a long time, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR has resisted drastic price fluctuations seen in the memory chip industry and has always emphasized building long-term relationships with customers to deal with the industry's volatile cycles. Eve of earnings reports reveals layoffs, Intel Corporation (INTC.US) to "reduce costs and increase efficiency" in the hottest data center division. Chip giant Intel Corporation has once again launched a new round of cost optimization actions. On Monday, Intel Corporation officially informed employees of its Data Center Business Division that the company plans to carry out a new round of layoffs in that division. This is another round of "layoffs" for Intel Corporation after the large-scale cutbacks in 2024 and 2025. Somewhat contradictory, the Data Center and Artificial Intelligence (AI) business division, which is being "cut," is the main engine of Intel Corporation's recent financial recovery. Financial data shows that this division's revenue reached about $5.05 billion in the first quarter of 2026, up 22% year-on-year. Intel Corporation is set to announce its second-quarter financial results on Thursday (July 23) after the US market, with expectations currently quite optimistic. Analysts generally expect Intel Corporation's adjusted earnings per share to reach $0.22 and revenue to be $14.45 billion, representing a significant turnaround from the dismal situation of a $0.10 loss per share and $12.86 billion in revenue in the same period last year. Oracle Corporation (ORCL.US) faces a downgrade and regulatory setback after Wisconsin data center! may need to provide over $7 billion in collateral. After the Wisconsin Public Service Commission tightened credit requirements to protect residents from rising electricity prices, Oracle Corporation may need to provide over $7 billion in collateral for its large data center in Washington Harbor, Wisconsin. The Wisconsin Public Service Commission, which is responsible for reviewing and setting fee standards for public utility companies in the state, has refused to reconsider the regulations imposed on local utility company We Energies. Under the regulation, Oracle Corporation will need to provide a $7 billion guarantee for its large data center in Washington Harbor, Wisconsin, with an annual cost exceeding $100 million. This data center, located in Washington Harbor, Wisconsin, with a capacity of nearly 1 GW, is a key investment for Oracle Corporation to fulfill its $300 billion computing power supply contract with OpenAI. The increased cost of obtaining local power supply further exacerbates the challenges faced by this tech giant in advancing its AI strategy, including rising debt levels and accelerating cash burn, among other issues. Global iron ore export Hub Group, Inc. Class A strike crisis temporarily averted! Progress made in labor negotiations at BHP Group Ltd Sponsored American Depositary Receipt Repr 2 Shs (BHP.US)'s Hedland port. Mining giant BHP Group Ltd Sponsored American Depositary Receipt Repr 2 Shs made progress in negotiations with the union representing workers at the Hedland port in Western Australia on Tuesday. However, an agreement was not reached between the two parties at the end of the negotiations, and the union stated that negotiations would continue next week. The "Tripartite Alliance of Port Unions" said in a statement, "Some progress has been made in negotiations, but an agreement has not yet been reached. We will continue negotiations on establishing a safe, fair, and efficient iron ore industry on July 28." The progress in negotiations means that the possibility of announcing new strike actions before next Tuesday has slightly decreased, which is undoubtedly good news for the operation of the world's largest iron ore export port in Hedland. Earnings forecast Wednesday morning: Interactive Brokers Group, Inc. Class A (IBKR.US) Wednesday pre-market: AT&T (T.US)