Coming off a holiday-shortened week filled with tons of labor market data and a surprise jobs report, investors are greeted with a bit more calm in the coming week.
Markets will pick things up after a mixed Thursday that saw an uncertain market close with the S&P 500 (^GSPC) closing flat, the Nasdaq (^IXIC) down 0.8%, and the Dow (^DJI) gaining 1.1%.
Monday is likely to be the biggest day to watch on the economic calendar, with a slew of index readings from S&P Global and the Institute of Supply Management set to give investors a read on the state of the US service economy.
That data comes after the release of monthly independent payrolls from data provider ADP showed that the services side of the economy added the largest number of jobs in June.
In the corporate world, reports from PepsiCo (PEP) on Thursday and Delta Air Lines (DAL) on Friday should highlight the week. PepsiCo’s results should give investors some insight into the state of the American consumer, while Delta will provide more reading on the lasting effects of the Iran war and the energy crisis it sparked.
The jobs report complicates bullish bets
On Thursday, markets remained confident that a mid-year rate hike by Kevin Warsh’s Federal Reserve was warranted. Then came the job report for June.
The U.S. economy added 57,000 jobs last month, about half of what economists had expected. At the same time, May’s large addition of 172,000 was revised down to 129,000, and April’s figure was cut to 148,000 from 179,000. It’s not exactly the glowing example of a healthy labor market that Warsh was counting on.
While the market continues to fully price in the Fed’s one rate hike this year following the report, markets have backtracked slightly on their conviction. On Thursday morning, traders gave about a 75% chance that prices will end the year higher than they are now, according to CME data. On Wednesday, those errors stood at about 84%.
In his first post-Fed decision press conference, Chairman Kevin Warsh focused heavily on inflation and his goal of returning it to the Fed’s target rate of 2%, which remains elusive amid the energy shock of the Iran war.
Although June’s employment data was weak, many economists believe that inflation and unemployment may not be particularly linked for now, keeping pressure on inflation data – something to keep in mind as earnings season approaches.
Job seekers meet employers during the HIRE360 Diversity Hiring Expo & Mega Career Expo at the Carson Event Center on June 30, 2026, in Carson, California. (Justin Sullivan/Getty Images) ·Justin Sullivan via Getty Images
The AI story of the first half was all about the hardware
Trade in technology during the first half of 2026 was, in a word, uneven.
The iShares Expanded tech and software ETF (IGV), which tracks various names in the technology sector, is down 12% for the year. Even the Magnificent Seven (MAGS), where Big Tech foundations, as a group, have lost investors 2% in the past six months.
Chip stocks, on the other hand, have had a six-month rally driven by excitement around the sale of memory and storage and the need for traditional processors to power the creation of AI.
Micron (MU) was the poster child for explosive growth in the first two quarters of the year, with shares up 308%. Intel ( INTC ), which continues its turnaround effort, rose similarly by 280%, while AMD ( AMD ) rose 173% over the period. Put it all together, and the Philadelphia Semiconductor Index (^SOX), which tracks chip trading, has returned investors nearly 75% since Jan. 1.
This trend isn’t going anywhere, according to Bank of America technology analyst Vivek Arya, as construction of the backbone behind AI continues to accelerate. Another reminder that while AI may be the brainchild of software-focused Silicon Valley, the economics of AI are physical.
“We reiterate our theory of the AI industry moving forward in addressing structural constraints (chips, power), from securing returns on previous investments,” Arya wrote to clients. “Memory chip shortages and price hikes remain the main drivers.”
People view computer memory and data storage products from American multinational semiconductor company MICRON TECHNOLOGY, at the COMPUTEX TAIPEI trade show, in Taipei, Taiwan, June 2, 2026. (Daniel Ceng/Anadolu via Getty Images) ·Anadolu via Getty Images
Economic calendar and salaries
Monday
Economic data: S&P Global US PMI services, final reading for June (51.3 previously); S&P Global US composite PMI, final reading for June (52.2 previously); ISM services index, June (expected 54.2, 54.5 previously); ISM services prices paid, June (70 expected, 71.3 previously); ISM services new orders, June (57.5 expected, 57.3 previously); ISM services employment, June (48.1 expected, 47.9 previously)
Economic data: ADP weekly job change, week ended June 20 (+30,750 previously); Imports, month-on-month, May (+2% previously); Exports, month-on-month, May (+2.6% previously)
Benefits calendar: Penguin Solutions (PENG)
Wednesday
Economic data: MBA mortgage applications, week ended July 3 (+0% previously); Retail stores, month-on-month, last reading for May (+0.3% previously); FOMC meeting minutes
Benefits calendar: Levi Strauss & Co. (LEVI), PriceSmart (PSMT)
Thursday
Economic data: Initial jobless claims, week ended July 4 (previously 215,000); Continued applications, week ended June 27 (previously 1.841 million); Existing home sales, month-over-month, June (+1.3% expected, +3.2% previously)
Benefits calendar: PepsiCo (PEP), WD-40 Company (WDFC), Nurix Therapeutics (NRIX)
On Friday
Economic data:No significant economic data.
Benefits calendar: Delta Air Lines (DAL)
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