Please see below the daily update article from Brooks Macdonald, received this morning – 28/07/2026:
What has happened?
Markets were caught between easing Middle East tensions and renewed weakness in semiconductor stocks. The US-Iran pause agreed over the weekend appeared to hold, helping Brent crude fall -8.7% and supporting broader risk sentiment. The S&P 500 (+0.02%) and Nasdaq (-0.16%) finished little changed, while the Philadelphia Semiconductor Index fell a further -2.2%. Treasury yields also edged lower, although elevated real yields continued to weigh on equity valuations.
Diplomacy tempers energy concerns
Middle East developments were broadly supportive. President Trump said military action against Iran had been paused while negotiations continue, whilst reports pointed to ongoing discussions around the Strait of Hormuz. Although Houthi attacks on Saudi oil facilities over the weekend highlighted that risks remain, investors took comfort from the reduced likelihood of an immediate escalation.
Chips companies under pressure
Technology stocks weakened after another sell-off across the semiconductor sector. ASML fell -8.4% following reports that a Chinese company had begun mass production of deep ultraviolet lithography machines, raising competitive concerns for parts of the chipmaking supply chain. Nvidia also lost -5.0% amid renewed scrutiny of AI-related financing and spending. Despite the sector weakness, the wider market remained resilient, with nearly two-thirds of S&P 500 constituents advancing and the Russell 2000 rising +0.6%.
What does Brooks Macdonald think?
Yesterday’s trading highlighted the balance between easing geopolitical tensions and growing scrutiny of AI-related companies. The de-escalation in US-Iran tensions helped ease concerns around energy supplies and oil prices, although the situation remains fragile. Meanwhile, weakness in semiconductor stocks showed that parts of the AI trade remain sensitive to shifts in investor sentiment. Encouragingly, broader market participation remained healthy, suggesting overall risk appetite has held up well.
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Cherise Lancaster
28/07/2026