NEW YORK — Global financial markets showed mixed performance on July 17 as investors weighed the latest signs of moderating U.S. inflation against a stream of second-quarter corporate earnings, while renewed weakness in technology shares and geopolitical concerns limited broader gains.
Earlier in the week, U.S. inflation data came in below economists' expectations, easing concerns about persistent price pressures and prompting investors to reassess the outlook for Federal Reserve interest-rate policy. Subsequent producer price data also pointed to softer inflation, supporting expectations that policymakers may refrain from tightening monetary policy in the near term.
Strong earnings from several major financial institutions initially supported sentiment, with large U.S. banks reporting results that exceeded analysts' expectations. Asset manager BlackRock and investment bank Morgan Stanley also posted quarterly profits above forecasts, reinforcing expectations for a solid start to the earnings season.
However, those gains were offset by renewed selling in semiconductor and artificial intelligence-related stocks. The Nasdaq Composite underperformed broader indexes as investors rotated away from high-growth technology shares despite generally favorable earnings elsewhere in the market. The S&P 500 and Dow Jones Industrial Average also finished lower in recent trading after chipmakers weighed on the broader market.
Market participants also monitored rising oil prices linked to tensions in the Middle East, with concerns that higher energy costs could complicate the inflation outlook despite recent improvements in consumer and producer price data.
Fund flow data reflected continued investor confidence in equities despite recent volatility. According to data compiled by LSEG Lipper, global equity funds attracted net inflows for an eighth consecutive week through July 15, supported by optimism over corporate earnings and easing inflation. Global bond funds also extended their inflow streak, while money market funds recorded significant outflows as investors shifted toward riskier assets.
Attention is now turning to upcoming economic releases, including purchasing managers' index data and central bank decisions, as investors seek further evidence on inflation trends and the outlook for monetary policy. Markets will also continue to monitor quarterly earnings reports for indications of corporate profitability and consumer demand in the second half of 2026.
