Strait Attacks Flare but Chips Lead Early Gains
July 9, 2026
Though overnight strikes in the Strait of Hormuz kept the market on edge, chips kept gaining early today. PepsiCo's earnings appeared to disappoint but jobless claims were subdued.
Published as of: July 9, 2026, 9:23 a.m. ET
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| The markets | Last price | Change | % change |
|---|---|---|---|
| S&P 500® Index | 7,482.71 | -21.14 | -0.28% |
| Dow Jones Industrial Average® | 52,348.39 | -576.76 | -1.09% |
| Nasdaq Composite® | 25,870.65 | +51.96 | +0.20% |
| 10-year Treasury yield | 4.57% | +0.01 | -- |
| U.S. Dollar Index | 101.99 | Unch | Unch |
| Cboe Volatility Index® | 16.78 | -0.12 | -0.77% |
| WTI Crude Oil | $73.85 | +$0.33 | +0.48% |
| Bitcoin | $62,685 | +$255 | +0.38% |
(Thursday market open) Despite fresh overnight attacks by both sides in the Strait of Hormuz, stocks climbed early as investors appeared hopeful the renewed hostilities wouldn't blossom into full-scale war. Chip stocks stayed on the comeback trail to lead the way, though crude oil and Treasury yields ticked higher in what could keep a lid on any serious rally.
PepsiCo (PEP) cracked open earnings season this morning with a report that appeared to disappoint investors at first sip. Delta Air Lines (DAL) checks in tomorrow after a solid quarter for its sector as the so-called "K-shaped" economy kept travelers paying up for higher service levels. Turbulence emerged for airline stocks yesterday, however, as oil prices rose, again putting margins in focus and perhaps shifting the conversation back to potential rising costs.
Major indexes mostly stumbled Wednesday amid Middle East fighting, though chips and mega-cap tech bucked the trend. President Trump told reporters overnight he isn't sure if the war is fully back on, keeping investors on their toes. In data, weekly initial jobless claims fell to 215,000, a relatively subdued level. "The economic data is still firm and EPS growth forecasts are still intact, but there is still a ton of uncertainty out there," said Nathan Peterson, director of derivatives research and strategy at the Schwab Center for Financial Research (SCFR). Factors driving uncertainty—other than Iran—include Fed policy, AI-related capital spending, high levels of U.S. margin debt, and a weak yen.
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Three things to watch
- Warsh steps into spotlight: Next week brings more Fed headlines with Tuesday's semi-annual congressional testimony by new Fed Chairman Kevin Warsh. This gives legislators a chance to glean his thoughts on future policy, though he's typically played it close to the vest. One topic Warsh may have to address is inflation expectations, which hit their highest level in almost three years last month despite falling oil prices at the time, according to the latest New York Federal Reserve consumer survey. When inflation expectations surge, it can be self-reinforcing, and in the 1970s led to a historic "wage-price spiral" that ultimately got cured with punishing double-digit rates. Few forecast a repeat of that unpleasant era for the economy. However, even a hint of consumer inflation expectations becoming less "anchored," to borrow one of former Chairman Jerome Powell's favorite terms, might test the Fed's mettle. As former St. Louis Fed President James Bullard told CNBC this week, the Fed seldom raises rates just once.
- Excitement about AI, chips appears to persist: SK Hynix, a South Korean memory chipmaker, is expected to price its U.S. offering today and the listing is more than seven times oversubscribed, Bloomberg reported. It could be another sign that memory market and AI excitement persists, and it follows chip and AI infrastructure names rising Wednesday and again early today in what be technical short covering after the sector fell below its 50-day moving average. Weakness in cyclical parts of the market may have helped chips, a theme seen often when the war was at its height in April and May. Meanwhile, Apple (AAPL) rose nearly 4% and Nvidia (NVDA) 1% on Wednesday. Both lagged the broader market earlier this summer as Middle East tensions eased. The Information reported Wednesday that China would allow limited purchases of Nvidia's H200 chip for some AI firms due to a supply shortage. China had been urging companies to buy from domestic manufacturers, and Nvidia's market share in the country had effectively fallen to zero, Reuters reported.
- Auction action acclaimed: Treasury yields initially spiked Wednesday on the Middle East news and rising oil prices. A 10-year note auction, however, saw firm demand as investors flocked to buy with a yield near 4.58%. Treasury auctions face mounting competition for investors thanks to rising rates abroad and heavy corporate debt issuance related to the AI build-out. Wednesday's auction might ease concerns about yields having to move higher to attract interest. Next week looks lighter on the auction front, and Tuesday's Consumer Price Index (CPI) is the next potential catalyst for yield direction.
Crypto currents
Narrative and momentum: In the markets, story and momentum can drive prices for months or even years, with momentum often relegating narrative to the back seat, particularly in the later stages of a bull run. But for nonproductive assets like bitcoin and gold, it can take what seems like forever for markets to recover once that type of momentum breaks. Look at gold, which has lost about a fifth of its value over the past six months after a run of record highs over the previous two years. The fundamentals haven't really changed. Ditto for bitcoin. Debasement is still a thing, right? So why isn't bitcoin catching a bid? Absent any earnings reports, everyone's waiting for a catalyst, a narrative to emerge that will spark a rally. Meanwhile, bitcoin treasury company Strategy (MSTR), dubbed the "buyer of last resort," has turned seller, unloading an estimated $216 million of bitcoin last week, betraying founder Michael Saylor's "never sell" pledge. Not the narrative the bitcoin bulls were seeking.
" id="body_disclosure--media_disclosure--243876" >Narrative and momentum: In the markets, story and momentum can drive prices for months or even years, with momentum often relegating narrative to the back seat, particularly in the later stages of a bull run. But for nonproductive assets like bitcoin and gold, it can take what seems like forever for markets to recover once that type of momentum breaks. Look at gold, which has lost about a fifth of its value over the past six months after a run of record highs over the previous two years. The fundamentals haven't really changed. Ditto for bitcoin. Debasement is still a thing, right? So why isn't bitcoin catching a bid? Absent any earnings reports, everyone's waiting for a catalyst, a narrative to emerge that will spark a rally. Meanwhile, bitcoin treasury company Strategy (MSTR), dubbed the "buyer of last resort," has turned seller, unloading an estimated $216 million of bitcoin last week, betraying founder Michael Saylor's "never sell" pledge. Not the narrative the bitcoin bulls were seeking.
On the move
- PepsiCo fell about 1% as earnings per share came in a penny shy of analysts' estimates at $2.20 even as revenue slightly exceeded analysts' thinking. U.S. food and beverage performance "moderated" with consumer budgets tightening due in part to rising gas prices, the company said.
- Levi Strauss (LEVI) plunged almost 5% in early trading even though earnings beat analysts' estimates and the company raised its full-year guidance and dividend. Guidance for third-quarter revenue growth of 4% to 5% fell short of 8% second quarter revenue growth, possibly disappointing investors. Demand has been healthy, CEO Michelle Gass told CNBC.
- AstraZeneca (AZN) descended 8% ahead of the open after a heart disease drug candidate missed its primary endpoint in a Phase 3 clinical trial.
- Salesforce (CRM) dropped 4% as KeyBanc downgraded shares to sector weight from overweight, saying it hasn't heard strong feedback on AgentForce, the company's autonomous AI platform.
- IBM (IBM) sank 4% this morning after announcing updates to its agentic software development platform.
- Broadcom (AVGO) jumped 5% Wednesday after Broadcom and Apple signed a $30 billion chip deal. The deal means Broadcom will design and produce technology for Apple products.
- Delta slipped ahead of second quarter earnings, due early Friday. Analysts tracked by Schwab see earnings down almost 30% year over year to $1.48 per share, but revenue rising 5.2% to $17.5 billion.
- The Cboe Volatility Index (VIX) initially climbed double-digits yesterday morning to above 18, then fell over the course of the session to below 17. VIX never tested levels near 20 that typically mark dramatically higher uncertainty. A move in that direction might be notable.
- SpaceX (SPCX) fell nearly 1% to close below its debut price Wednesday in what so far has been a disappointing introduction to the Nasdaq-100® (NDX).
More insights from Schwab
Trading backdrop assessed: An era of market moderation has evolved into a more "temperamental" backdrop over the last few years marked by higher macro volatility, more frequent supply shocks, and greater geopolitical instability, wrote Schwab's SCFR's Chief Investment Strategist Liz Ann Sonders and Head of Macro Research and Strategy Kevin Gordon in their latest analysis.
" id="body_disclosure--media_disclosure--183791" >Trading backdrop assessed: An era of market moderation has evolved into a more "temperamental" backdrop over the last few years marked by higher macro volatility, more frequent supply shocks, and greater geopolitical instability, wrote Schwab's SCFR's Chief Investment Strategist Liz Ann Sonders and Head of Macro Research and Strategy Kevin Gordon in their latest analysis.
X marks the spot: Last month's Schwab Trading Activity Index™ (STAX), which tracks client activity to gauge sentiment, hit a multi-year high, and Gen X investors remained the most bullish group from a generational standpoint. Millennials also grew more positive.
Retirement plan primer: Schwab's newest set of retirement articles can help you learn about differences in eligibility rules, contribution limits, and other factors involved in 403(b) versus 457(b) retirement plans, as well as the basics of 403(b) plans and 457(b) plans. It's also important to understand what makes 403(b) plans differ from 401(k) plans.
Chart of the day
Data source: FTSE Russell. Chart source: thinkorswim® platform.
Past performance is no guarantee of future results.
For illustrative purposes only.
The Russell 2000 Index (/RUT—candlesticks) of small-cap stocks has been rising within a narrow price channel well above its 200-day simple moving average (green line). The Average Directional Index (ADX—bottom pane) is a technical indicator used to measure the strength of a market trend. A reading above 40 indicates the trend is in extreme trending territory and may suggest a potential peak could occur, and a reading below 20 indicates the trend is weak. The Moving Average Convergence/Divergence (MACD—middle pane) indicator shows momentum turning to the downside after RUT fell in four of the past five days. The MACD indicator can help traders measure a stock's momentum and identify potential buy and sell signals.
The week ahead
Check out the investors' calendar for a summary of the top economic events and earnings reports on tap this week.
July 10: Expected earnings from Delta Air Lines (DAL).
July 13: No major data or earnings expected.
July 14: June Consumer Price Index (CPI), congressional testimony from Fed Chairman Kevin Warsh, and expected earnings from JPMorgan Chase (JPM), Bank of America (BAC), Goldman Sachs (GS), Wells Fargo (WFC), and Citigroup (C).
July 15: June Producer Price Index (PPI) and core PPI, and expected earnings from ASML (ASML), Johnson & Johnson (JNJ), Morgan Stanley (MS), BlackRock (BLK), Progressive (PGR), Bank of New York Mellon (BNY), PNC Financial Services (PNC), Kinder Morgan (KMI), United Airlines (UAL), and JB Hunt Transport (JBHT).
July 16: Expected earnings from Taiwan Semiconductor Manufacturing (TSM), GE Aerospace (GE), UnitedHealth Group (UNH), Abbott Laboratories (ABT), US Bancorp (USB), Netflix (NFLX), and Intuitive Surgical (ISRG).