Top U.S. Stories

  • President Trump said the U.S. will hold off on a planned strike against Iran after claiming Middle East allies reached parameters for a deal. He made the decision conditional on a rapid agreement (Bloomberg, AP). Why it matters: A full-scale U.S.-Iran conflict looked imminent as recently as Friday; oil markets and shipping through the Strait of Hormuz had been pricing in a much worse outcome.
  • Hamas has agreed in principle to disarm under a Trump-backed framework announced last week, but Hamas officials say they won’t act until Israel halts strikes, withdraws to the “Yellow Line” and allows an aid surge — a condition that appears to contradict Trump’s framing of the deal as settled (France 24, CNBC). Why it matters: The gap between the two sides’ conditions suggests the ceasefire’s next phase remains fragile despite the headline announcement.
  • Friday, July 31 — the last trading session before the weekend — saw U.S. stocks rally broadly as Amazon’s earnings beat lifted tech shares, capping a fourth straight winning month for the Dow (CNBC).
  • July’s jobs report is due Friday, August 7 (U.S. Bureau of Labor Statistics). Why it matters: With the Fed on hold at 3.50-3.75% for a fifth straight meeting, the jobs data is the next major input into whether rate cuts move up the timeline.
  • In Kumamoto, Japan, a woman in her 70s died of suspected heatstroke while sheltering in her car after the July 28 earthquake — the first suspected disaster-related death of the ongoing crisis, as the region braces for its first 40°C “extreme heat day” on August 3 (Nikkei).
  • Golf: Japan’s Shiho Kuwaki won her first major at the AIG Women’s Open, beating Germany’s Esther Henseleit in a playoff for a 5-under total — the third Japanese winner of the tournament since it became a major (NHK).

Markets

Markets were closed over the weekend; the last close (Friday, July 31) showed a rare combination of higher stocks, a stronger yen, and higher oil. The S&P 500 rose 0.7% to 7,489.72, the Dow gained 0.53% to 52,485.03, and the Nasdaq climbed 1.0% to 25,373.85 (CNBC). Japan’s Nikkei 225 surged 4.03% to 64,362.02 on spillover from U.S. tech strength (Nikkei). WTI crude settled around $84.67 a barrel, with Brent near $90, as Middle East tensions had been pushing oil higher into the weekend (CNBC) — a dynamic that may ease now that Trump has paused the planned Iran strike. The dollar closed in New York around ¥157.35-45, extending a third straight day of yen gains on suspected government/BOJ intervention (Nikkei).

Stocks in Focus

  • Amazon — Strong earnings drove the stock sharply higher, the single biggest factor lifting Friday’s rally.
  • Energy stocks — Oil had been climbing on Middle East risk; Trump’s decision to hold off on strikes could shift the trade this week.
  • Rhine-dependent shippers and logistics firms — Record-low water levels on Germany’s Rhine, reported at Cologne and the Dutch border, are constraining inland shipping capacity (NL Times).

Compass Insight

Today’s throughline is “pulled back from the brink.” A full U.S.-Iran military clash looked likely as recently as Friday; Trump’s decision to hold off, tied to talks starting Monday, is a last-minute de-escalation, not a resolved conflict — Gaza’s disarmament standoff shows how quickly stated deals can unravel into competing conditions. Markets had priced in some of that Middle East risk through higher oil prices, so a genuine de-escalation this week could ease pressure on energy costs, even as the yen’s recent strength — likely intervention-driven rather than a durable trend — offers only a partial buffer for import prices. Short term, watch how the Monday talks progress and how oil reacts. Medium term, Friday’s jobs report and the Fed’s rate path remain the more durable forces shaping markets, with this week’s geopolitical calm best treated as a tailwind, not a new baseline.

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