Mon.., July 27, 2026
[4:10 PM ET…closing prices for stocks, 3:50ish for commodities and bonds]
Tale of the Tape at the gas pump, nationwide averages, courtesy of AAA.
Fri., Feb. 27…regular $2.98…diesel $3.75
Mon.., July 27…regular $4.11…diesel $5.29
After 13 consecutive days of tit-for-tat strikes between the United States and Iran, the two sides paused Friday, Saturday and Sunday, and thus far today, as top U.S. officials raised concerns about dwindling munitions stockpiles.
President Trump had threatened last week to drastically escalate the war if Iran continued to threaten ships in the Strait of Hormuz, the Wall Street Journal reporting the U.S. was poised to launch an intensive series of strikes against Iran, which could have lasted up to two weeks.
U.S. Ambassador to the United Nations Mike Waltz did the Sunday news show circuit, telling “Fox News Sunday” that Trump is trying to give peace talks “some space.”
“He’s giving it a little bit of room,” Waltz said. “We’ve had both Oman and Iran and number of our other negotiators engaged at every level, from the most senior levels all the way down to the technical level, over the past few weeks and particularly in the past few days.”
Iranian Foreign Ministry spokesperson Esmail Baghaei said Iran has made progress in talks with Oman about establishing safe passage for ships seeking to traverse the waterway. Still, he maintained that the Strait’s status is the same, requiring oversight of vessels passing through the Strait on an approved route – a status quo that has thus far been unacceptable to the Americans.
The New York Times reported Gen. Dan Caine, chair of the Joint Chiefs of Staff, has privately argued resuming major combat operations against Iran would seriously deplete the antimissile interceptors available to U.S. Central Command (Centcom). The Times reported the threat to interceptor stockpiles is one of many considerations that have made a return to major combat operations risky.
Two weekends ago, an Iranian missile got through U.S. air defenses in Jordan and the result was three American soldiers killed, many injured.
CNN reported Vice President Vance raised concerns about escalating the war in a meeting with the president at the White House on Friday.
Two sources with knowledge of Centcom commander Adm. Brad Cooper’s position told Axios that Cooper has recommended stopping the bombing campaign around the Strait because it has reached the limit of its effectiveness.
But the Wall Street Journal reported Cooper said the U.S. can cope with the limited stocks of Patriot and other air defense interceptors because stepped-up strikes would blunt Iran’s ability to launch large numbers of missiles. So, there’s a bit of a contradiction in the reporting on Cooper’s position.
Amb. Waltz told NBC’s “Meet the Press” that the U.S. has “everything that it needs” to conduct military operations against Iran.
“I want to be crystal clear: The U.S. military, and I’ve verified this every which way, has everything that it needs to conduct this campaign as effective as it needs to be,” he said.
President Trump told the Wall Street Journal in a statement that “we have far more munitions than anyone in the world, and far more than we need,” which just isn’t true.
Meanwhile, you have the Houthi rebel threat and the Red Sea, the militants launching strikes on facilities belonging to Saudi Aramco in two towns Saturday.
And the U.S. is maintaining its blockade on Iran’s ports.
Then this afternoon, President Trump told reporters aboard Air Force One: “We’re talking right now. We’re having good talks… I think there’s a good chance that something could happen, and if it does, good, if it doesn’t, we go back to doing what we were doing two days ago.”
[Note to Earthlings…trust me…We are NOT having “good talks.” As I wrote in my “Week in Review,” a bunch of Post-its are being exchanged.]
Saudi Arabia, Jordan and Iraq reported drone attacks late Monday (Middle East time…Tehran is 7 ½ hours ahead of New York).
As for the response to the ‘pause’ in the energy markets, crude oil sold off from Friday’s close of $90 on WTI to $82 early this morning, bounced to $84, and then slid back to the $82-$83 range. Easing geopolitical tensions reduced concerns over supply disruptions.
Supply conditions also improved after crude loadings resumed at the Caspian Pipeline Consortium terminal (where Chevron and Exxon Mobil have an interest) on Russia’s Black Sea coast, a key export hub for Kazakh oil that had recently been disrupted by Ukrainian drone attacks.
Gasoline futures, about $3.40 Friday, fell to $3.25 early this morning, but then rallied back above $3.30.
Ukraine appeared to shift its focus from Russian oil refineries to maritime targets, though supply concerns persisted after earlier attacks damaged 24 of Russia’s 34 largest refineries.
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The stock and bond markets rallied early this morning in the futures’ markets and at the open, but then both sold off, as chip stocks suffered amid the ongoing AI anxiety.
It’s a big week…specifically Wednesday and Thursday.
Wednesday, we get the Federal Reserve’s Open Market Committee (FOMC) decision on interest rates, and I do not believe the Fed will raise its benchmark funds rate, rather they’ll stand pat.
However, there will be dissenters. But a continued decline in oil prices could take some pressure off them.
New Fed Chair Kevin Warsh has indeed made it clear that the Fed’s target inflation rate of 2% is a hard target, and it’s thought he will raise rates because the Fed’s preferred inflation barometer, the personal consumption expenditures index, PCE, is above 3% on core (ex-food and energy).
Three percent isn’t two percent, boys and girls, and the inflation rate has been well above 2% for years. Warsh clearly wants to change that. But I just don’t see him convincing a majority to do it this week, assuming he himself wanted to.
On the other hand, the midterm elections are coming up, and with the next FOMC meeting Sept. 15-16, to move then would be viewed by some as highly political. [The meeting after that is Oct. 27-28, and the Fed wouldn’t dare move then, either way, barring a true geopolitical disaster that necessitated action.]
It is a tough decision for Warsh (one of the toughest for a Fed chair in recent years) and the market will be parsing every word he says at the press conference Wed. afternoon in terms of future direction, though at the same time, he has also made it clear his Fed is not giving forward guidance.
Sorry to ramble, but these are the issues. The latest PCE data, by the way, comes out Thursday morning, and I’m not clear on how much of a heads up the FOMC is given on this particular key number set.
We also have big earnings reports after the market close on Wednesday (Microsoft and Meta) and Thursday (Apple and Amazon). It’s all about their statements on future capex and whether they are staying the course, increasing spending, or cutting back. The remarks will have a major impact on the semiconductor sector. [Apple’s story is a bit different than the hyperscalers’.]
I do have to add a little note on SpaceX and its still-sliding shares to well below its IPO price. Frankly, I was shocked at the market reaction today in light of Friday night’s highly successful Starship test flight.
I watched the entire 65-minute flight and was totally wowed. Starship, in a major test of its abilities, successfully launched 20 Starlink satellites to prove to future commercial partners, including Starlink itself, that it can do so…and it made contact with all 20 almost instantly. And the rocket returned safely into the waters of the Indian Ocean…a soft landing.
I just thought it was fantastic (the amazing cameras helped) and I assumed it was the needed shot in the arm for the shares. Alas, I was wrong…career Mistake No. 6,678.
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On the sports beat, golf fans got a real treat this weekend as we had the coming-out party for 21-year-old Jackson Koivun, a two-time College Golfer of the Year, who was in just his third professional tournament at the 3M Championship in Blaine, Minn.
Koivun had an electrifying 28 on his back nine Saturday, amazing Jim Nantz and Trevor Immelman on CBS, and the rest of us, to vault into the lead, and then Sunday, he held off World No. 1 Scottie Scheffler to win by three.
It was really good stuff.
Dow Jones +262…+0.5% [52209]
S&P 500 +1…+0.02% [7413]
Nasdaq -43…-0.2% [24932]
Oil (WTI) $82.00…Brent $87.80
Gold $4085
Silver $58.60
Bitcoin $64,910 [4:00 PM ET]
U.S. 2-yr. 4.32%
U.S. 10-yr. 4.64%
Japanese 10-yr. 2.77%
Back Tues.
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Brian Trumbore
