Global Markets Open Mixed Amid Geopolitical Tensions and US Employment Data

Global stock markets opened with mixed trends amid ongoing geopolitical uncertainty, particularly around the Strait of Hormuz, which remains reportedly closed to free navigation. Iran denied direct talks with the US, while President Trump described US-Iran interactions as "semi-negotiations," expressing confidence that economic pressures on Iran would resolve the situation. Asian markets showed gains, with Tokyo up about 2%, Hong Kong 0.6%, Shanghai 0.2%, and Seoul 0.7%. Samsung shares were stable, while SK Hynix rose slightly. US futures showed minor changes, with Dow Jones futures down 0.1%, S&P 500 steady, and Nasdaq futures up 0.2%. In Tel Aviv, dual-listed stocks opened with a positive arbitrage gap of approximately 0.45%, with Tower Semiconductor expected to rise about 5%, while competitors Kemet and Nova were forecast to decline up to 2%. NICE was set to increase over 4%, and Teva and Elbit Systems up to 1.5%. Key earnings reports are expected from Kemet, fintech company Nayax, and drone camera maker Next Vision.

Last week, the Tel Aviv Stock Exchange closed mixed: TA-35 rose about 0.5%, TA-90 fell 2.2%, and TA-125 declined 0.2%. The banking index led gains with a 2.4% rise, technology up 1%, while construction and oil & gas sectors declined sharply by 4.8% and 4.6%, respectively, amid falling global oil prices. El Al shares surged 20% after doubling net profit in Q2 compared to last year. Palo Alto Networks jumped 9% after entering major indices in a phased process to increase Israeli investor exposure to the cybersecurity giant.

In the US, Wall Street ended a strong week with the S&P 500 hitting a record high above 3,700 points, Nasdaq rising 5.2%, and Dow Jones up 3%. Semiconductor stocks exited bear market territory, with ETFs like SOXX up 7.6%. Software sector ETF IGV rose 8.6%, led by Palantir’s 40% jump following strong Q2 results. SpaceX shares climbed 22.8% after positive earnings and a $16.8 billion chip plant investment with Tesla in Texas. Berkshire Hathaway reported net income doubling to $25.67 billion, with $39 billion invested in H1 2026, mainly in Alphabet shares.

In fixed income, Israel’s government bond index rose 0.4%, with yields below 3%, signaling renewed investor confidence. Corporate bonds also gained 0.5%, with yields at 2.35%. US Treasury yields fell after weaker-than-expected July jobs data, with 10-year yields at 4.65% and 2-year at 4.2%. The Israeli shekel weakened 0.2% against the dollar but strengthened 1.8% last week amid easing geopolitical tensions and a weaker dollar globally. Brent crude oil prices rebounded slightly to around $84 per barrel after a 7% drop last week, while gold prices declined 0.3% but remain near two-month highs.

No major macroeconomic data is expected today globally, with investors awaiting Wednesday’s US Consumer Price Index report, which is forecast to show a slight inflation slowdown. Israeli CPI for July, due Friday, is expected to rise 0.2%-0.3%, with annual inflation predicted to fall to 1.5%. Analysts expect the Bank of Israel to delay further rate cuts until geopolitical clarity improves, possibly cutting rates twice over the next year but cautiously.

The US July jobs report surprised with a 23,000 job loss versus an expected gain of 83,000, and unemployment fell to 4.1%, mainly due to fewer people actively seeking work. This led markets to reduce the probability of a September rate hike from 67% to 44%. CNBC’s Jeff Cox noted the report’s nuances, including a 53,000 drop in government jobs and a slight decline in labor force participation, suggesting the Federal Reserve may focus more on inflation data than employment in upcoming decisions.

Market strategist Tom Lee of Fundstrat Capital predicts the S&P 500 could surpass 3,800 points this month, driven by strong earnings and technical momentum. He remains bullish on semiconductor and memory stocks, expecting a recovery similar to the late 1990s, and highlights continued strength in AI demand as a key growth driver.