Earnings Season Kicks Off as Geopolitics Rattle Markets

Macro Picture

Oil and Middle East tensions are front and centre today. US petrol prices have climbed back above $4 as the Iran conflict intensifies. Brent crude briefly touched $90 after Iran targeted tankers. Tehran has since signalled openness to talks from mediators, and prices pulled back. UK gilts are under pressure too. Investors are bracing for higher spending under Britain's new Prime Minister, with Andy Burnham flagging flexibility on fiscal rules.

Earnings Season Heats Up

Today is Alphabet day. The $2.1 trillion Google parent reports after the bell — markets will focus on AI revenue growth. IBM and Texas Instruments also drop numbers tonight. Charles Schwab already reported this morning. Analysts recently lifted their consensus target on Schwab to $122.42. Eighteen of 22 covering brokers hold Buy ratings. Capital One released its Q2 earnings call transcript overnight.

Short Squeeze Risks

Wolfspeed remains the most dangerous name for bears. SI sits at 79% of free float with zero shares available to borrow. The stock has tripled over three months. Hertz carries 70% short interest with equally zero availability. Both stocks are squeeze candidates. Meanwhile, Chewy saw shorts cover, with SI dropping nearly 3 points to 65.8%.

Nordic Insider Buying

Swedish billionaire Fredrik Lundberg made a bold statement overnight. His vehicle Lundbergföretagen spent over $93 million buying SHB A (Svenska Handelsbanken) and SAND (Sandvik) shares. The Handelsbanken purchases alone totalled $72 million across multiple trades. On the flip side, China's state funds deployed $9 billion buying domestic equities after last week's AI-linked sell-off rattled Chinese markets.