The Market ThesisWeekly Summary
Asia & Pacific Edition
August 1, 2026 at 9:00 AM ET
By MacroGlide's Analysts
Markets Recap for the week of July 27 – August 2, 2026
AI Stocks Rally as China Factory Activity Declines
Weekly Top Trends
AI-linked stocks powered standout gains in Asia this week. The Hang Seng Index jumped 3.69% as Alibaba soared 9.02% on renewed investor demand for tech leaders. Strength in these names helped offset weaker performances in other regional benchmarks and kept tech at the center of market attention.
China's activity indicators pointed to a slowdown, as the NBS Manufacturing PMI fell to 49.2 and the Non-Manufacturing PMI dipped to 49. Both readings slipped into contraction territory for the first time in five months, signaling broad weakness beyond just the factory sector. The disappointing data increased focus on policy tools to support growth after a lengthy period of steady expansion.
Sony shares surged 10.87% after the company reported quarterly earnings per share of 0.365, ahead of market estimates. The stock’s outperformance made it the biggest mover among Japan’s large caps this week. Sony’s results highlighted the resilience of entertainment and tech earnings even as the Nikkei 225 declined 0.39%.
Benchmark Moves
The Hang Seng Index jumped 3.69% this week, mainly driven by a surge in major AI-related stocks such as Alibaba, which rose 9.02%. However, WTI crude oil fell sharply by 5.20% to $84.67 after official data confirmed China’s factory activity shrank for the first time in five months, pointing to weaker industrial demand. This drop in oil prices signaled that lower manufacturing output is feeding through to energy markets, even as equities benefited from tech gains. If regional growth remains sluggish and oil stays under pressure, the next phase may see investor rotation away from cyclicals and more focus on defensive equity sectors.
Market data as of Jul 31, 2026 at 4:00 PM ET.
Market data as of Jul 31, 2026 at 4:00 PM ET.
Market data as of Jul 31, 2026 at 5:00 PM ET.
Key Financial Reports
Asia’s latest batch of earnings reports featured several high-profile beats, with most technology and industrial firms citing demand resilience and margin improvements. Sony Group Corporation (SONY) posted an EPS of 0.365, not only well above the 0.283 estimate but more than triple last quarter’s 0.091, as management highlighted record PlayStation network services and a better sales mix in its entertainment arm. POSCO Holdings Inc. (PKX) also beat sharply, delivering EPS of 1.3 versus the 0.85 forecast, driven by stable energy materials sales and tight cost controls that allowed operating margins to rise despite soft construction steel demand. The fact that key names are outperforming on a combination of product mix and cost execution signals that select segments in Asia’s tech and materials sectors are weathering weak macro data more effectively than expected.
EPS reported the week of July 27 – August 2, 2026 ET. Figures use each company's reported basis.
Key Macroeconomic Reports
Asia showed broadening economic weakness this week, as both China’s key PMI gauges fell below 50 and Australia’s inflation rate continued to ease. China’s NBS Manufacturing PMI dropped to 49.2 from 50.3, and the Non-Manufacturing PMI weakened further to 49.0 from 50.2, marking outright contraction in both factory and service sectors and pointing to softer business activity. At the same time, Australia’s yearly CPI cooled to 3.8% from 4%, reinforcing the signal of fading demand across the region as cost pressures subside. With China’s slowdown now hitting both industrial output and services while inflation elsewhere retreats, Asian policymakers may pause on tightening further, increasing the likelihood of steady rates for now.
Macroeconomic data released the week of July 27 – August 2, 2026 ET.
Weekly Reflection
What was the main outcome of the week?
Asia’s equity markets ended higher, driven by outstanding earnings from technology leaders. Sony reported a strong earnings surprise of 0.08 above estimate, and Alibaba shares surged as investors rewarded digital sector outperformance. This rally for AI and tech overshadowed fresh weakness in China’s industrial data, setting the tone for sector leadership across the region.
What do we infer from the market behavior?
Flows rotated decisively into large-cap technology stocks after Sony and Fujitsu posted better-than-expected results, while benchmarks like the Nikkei 225 and TOPIX declined modestly. The Bank of Japan held rates steady at 1%, steering clear of policy surprises and allowing equity risk-taking in growth names. This price action signals clear sector rotation, with heightened volatility as capital moved out of cyclicals and into AI-linked stocks.
What the week revealed about the current market state?
The market structure is fractured, with resilience concentrated in technology shares and persistent weakness across broader manufacturing and services. China’s NBS Manufacturing PMI dropped to 49.2, confirming a contraction in industrial activity at the same time non-manufacturing PMI declined to 49. Export-driven digital and AI firms bucked this trend, highlighting a growing divide between sector winners and the rest of the regional economy.
How these insights shape the forward picture?
Policy responses and company earnings remain central, with future direction hinging on China’s growth path and key results from Asia’s corporates. Investors should track upcoming data on consumer activity and export trends as further weakness in China’s PMIs could pressure regional demand. The sector split seen this week means volatility and rapid style rotation are likely to persist as markets weigh tech outperformance against signals of broader economic slowdown.
Top Stories
A quick look at the five stories that shaped this week's market sentiment. Explained with brief context highlighting why each story mattered this week.
Source: CNBC — Asia Pacific
Chipmaker CXMT’s 466% market debut surge makes it the most valuable China-listed company
Changxin Technology Group (CXMT) saw its shares surge nearly 466% during its debut on Shanghai's STAR Market, making it the most valuable company listed in China with a market cap of about 3.3 trillion yuan. The Hefei-based chipmaker raised 57.92 billion yuan ($8.6 billion) by pricing its IPO at 8.66 yuan per share. This performance is attributed to strong demand for DRAM chips, essential for electronic devices. CXMT reported an operating profit of 35.43 billion yuan in Q1, a turnaround from a loss of 2.83 billion yuan a year earlier.
Source: Australian Financial Review
NAB warns of housing headwinds as mortgage applications drop 15pc
National Australia Bank (NAB) reported a 15% drop in mortgage applications over the past three months, attributing the decline to Labor's tax changes and rising interest rates. NAB's figures highlight a weakening housing market, affected by the Reserve Bank of Australia's three interest rate hikes this year. The bank's chief economist noted that multiple factors beyond interest rate decisions have contributed to the downturn in demand for new loans.
Source: CNBC — Asia Pacific
SK Hynix, Samsung shares skyrocket to clock best days as AI rally roars back
Shares of South Korean chipmakers SK Hynix and Samsung Electronics surged nearly 30% and 27% respectively, marking their best single-day performances as optimism around AI spending returned after strong earnings from Amazon and Microsoft. Other semiconductor stocks also gained, with LG Innotek rising 21.23% and Taiwan's TSMC climbing almost 10%. This rally follows a sell-off driven by concerns over AI valuations and competition from Chinese memory chipmakers. The iShares Semiconductor ETF (SOXX) rose over 8% as investors regained confidence.
Source: Australian Financial Review
Jittery investors brace for defining week for AI trade
This week is critical for the global artificial intelligence trade as major tech companies, including Microsoft, Amazon, and Meta, prepare to release quarterly earnings. Investors are eager to see if spending in AI is yielding expected returns, following rapid growth in equity markets driven by AI hype. The results will be scrutinized for signs of performance amid concerns over debt-fueled spending plans. This week could significantly influence market sentiment regarding AI investments.
Source: Australian Financial Review
This Nvidia deal is sparking fears markets could ‘go straight down’
Investors are concerned about Nvidia's financial strategies in the AI sector, with warnings that the market could face a downturn. The chip giant's approach to maintaining the AI hype has sparked fears among market participants, especially after a recent incident where oil prices fell but the S&P 500 remained stable. This situation highlights shifting dynamics in the market, as Nvidia's valuation has made it the second-largest company globally. Analysts warn that the current enthusiasm may not be sustainable.
Other Headlines
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Explore all past issues →The Market ThesisWeekly Summary
Asia & Pacific Edition
August 1, 2026 at 9:00 AM ET
Markets Recap for the week of July 27 – August 2, 2026
AI Stocks Rally as China Factory Activity Declines
Weekly Top Trends
AI-linked stocks powered standout gains in Asia this week. The Hang Seng Index jumped 3.69% as Alibaba soared 9.02% on renewed investor demand for tech leaders. Strength in these names helped offset weaker performances in other regional benchmarks and kept tech at the center of market attention.
China's activity indicators pointed to a slowdown, as the NBS Manufacturing PMI fell to 49.2 and the Non-Manufacturing PMI dipped to 49. Both readings slipped into contraction territory for the first time in five months, signaling broad weakness beyond just the factory sector. The disappointing data increased focus on policy tools to support growth after a lengthy period of steady expansion.
Sony shares surged 10.87% after the company reported quarterly earnings per share of 0.365, ahead of market estimates. The stock’s outperformance made it the biggest mover among Japan’s large caps this week. Sony’s results highlighted the resilience of entertainment and tech earnings even as the Nikkei 225 declined 0.39%.
Benchmark Moves
The Hang Seng Index jumped 3.69% this week, mainly driven by a surge in major AI-related stocks such as Alibaba, which rose 9.02%. However, WTI crude oil fell sharply by 5.20% to $84.67 after official data confirmed China’s factory activity shrank for the first time in five months, pointing to weaker industrial demand. This drop in oil prices signaled that lower manufacturing output is feeding through to energy markets, even as equities benefited from tech gains. If regional growth remains sluggish and oil stays under pressure, the next phase may see investor rotation away from cyclicals and more focus on defensive equity sectors.
Indexes
Detailed View →Market data as of Jul 31, 2026 at 4:00 PM ET.
Stocks
Detailed View →Market data as of Jul 31, 2026 at 4:00 PM ET.
Commodities & Crypto
Detailed View →Market data as of Jul 31, 2026 at 5:00 PM ET.
Key Financial Reports
Asia’s latest batch of earnings reports featured several high-profile beats, with most technology and industrial firms citing demand resilience and margin improvements. Sony Group Corporation (SONY) posted an EPS of 0.365, not only well above the 0.283 estimate but more than triple last quarter’s 0.091, as management highlighted record PlayStation network services and a better sales mix in its entertainment arm. POSCO Holdings Inc. (PKX) also beat sharply, delivering EPS of 1.3 versus the 0.85 forecast, driven by stable energy materials sales and tight cost controls that allowed operating margins to rise despite soft construction steel demand. The fact that key names are outperforming on a combination of product mix and cost execution signals that select segments in Asia’s tech and materials sectors are weathering weak macro data more effectively than expected.
Earnings Per Share (EPS)
Detailed View →EPS reported the week of July 27 – August 2, 2026 ET. Figures use each company's reported basis.
Key Macroeconomic Reports
Asia showed broadening economic weakness this week, as both China’s key PMI gauges fell below 50 and Australia’s inflation rate continued to ease. China’s NBS Manufacturing PMI dropped to 49.2 from 50.3, and the Non-Manufacturing PMI weakened further to 49.0 from 50.2, marking outright contraction in both factory and service sectors and pointing to softer business activity. At the same time, Australia’s yearly CPI cooled to 3.8% from 4%, reinforcing the signal of fading demand across the region as cost pressures subside. With China’s slowdown now hitting both industrial output and services while inflation elsewhere retreats, Asian policymakers may pause on tightening further, increasing the likelihood of steady rates for now.
Macroeconomic Data
Detailed View →Macroeconomic data released the week of July 27 – August 2, 2026 ET.
Weekly Reflection
What was the main outcome of the week?
Asia’s equity markets ended higher, driven by outstanding earnings from technology leaders. Sony reported a strong earnings surprise of 0.08 above estimate, and Alibaba shares surged as investors rewarded digital sector outperformance. This rally for AI and tech overshadowed fresh weakness in China’s industrial data, setting the tone for sector leadership across the region.
What do we infer from the market behavior?
Flows rotated decisively into large-cap technology stocks after Sony and Fujitsu posted better-than-expected results, while benchmarks like the Nikkei 225 and TOPIX declined modestly. The Bank of Japan held rates steady at 1%, steering clear of policy surprises and allowing equity risk-taking in growth names. This price action signals clear sector rotation, with heightened volatility as capital moved out of cyclicals and into AI-linked stocks.
What the week revealed about the current market state?
The market structure is fractured, with resilience concentrated in technology shares and persistent weakness across broader manufacturing and services. China’s NBS Manufacturing PMI dropped to 49.2, confirming a contraction in industrial activity at the same time non-manufacturing PMI declined to 49. Export-driven digital and AI firms bucked this trend, highlighting a growing divide between sector winners and the rest of the regional economy.
How these insights shape the forward picture?
Policy responses and company earnings remain central, with future direction hinging on China’s growth path and key results from Asia’s corporates. Investors should track upcoming data on consumer activity and export trends as further weakness in China’s PMIs could pressure regional demand. The sector split seen this week means volatility and rapid style rotation are likely to persist as markets weigh tech outperformance against signals of broader economic slowdown.
Top Stories
A quick look at the five stories that shaped this week's market sentiment. Explained with brief context highlighting why each story mattered this week.
Chipmaker CXMT’s 466% market debut surge makes it the most valuable China-listed company
Changxin Technology Group (CXMT) saw its shares surge nearly 466% during its debut on Shanghai's STAR Market, making it the most valuable company listed in China with a market cap of about 3.3 trillion yuan. The Hefei-based chipmaker raised 57.92 billion yuan ($8.6 billion) by pricing its IPO at 8.66 yuan per share. This performance is attributed to strong demand for DRAM chips, essential for electronic devices. CXMT reported an operating profit of 35.43 billion yuan in Q1, a turnaround from a loss of 2.83 billion yuan a year earlier.
Source: CNBC — Asia Pacific
NAB warns of housing headwinds as mortgage applications drop 15pc
National Australia Bank (NAB) reported a 15% drop in mortgage applications over the past three months, attributing the decline to Labor's tax changes and rising interest rates. NAB's figures highlight a weakening housing market, affected by the Reserve Bank of Australia's three interest rate hikes this year. The bank's chief economist noted that multiple factors beyond interest rate decisions have contributed to the downturn in demand for new loans.
Source: Australian Financial Review
SK Hynix, Samsung shares skyrocket to clock best days as AI rally roars back
Shares of South Korean chipmakers SK Hynix and Samsung Electronics surged nearly 30% and 27% respectively, marking their best single-day performances as optimism around AI spending returned after strong earnings from Amazon and Microsoft. Other semiconductor stocks also gained, with LG Innotek rising 21.23% and Taiwan's TSMC climbing almost 10%. This rally follows a sell-off driven by concerns over AI valuations and competition from Chinese memory chipmakers. The iShares Semiconductor ETF (SOXX) rose over 8% as investors regained confidence.
Source: CNBC — Asia Pacific
Jittery investors brace for defining week for AI trade
This week is critical for the global artificial intelligence trade as major tech companies, including Microsoft, Amazon, and Meta, prepare to release quarterly earnings. Investors are eager to see if spending in AI is yielding expected returns, following rapid growth in equity markets driven by AI hype. The results will be scrutinized for signs of performance amid concerns over debt-fueled spending plans. This week could significantly influence market sentiment regarding AI investments.
Source: Australian Financial Review
This Nvidia deal is sparking fears markets could ‘go straight down’
Investors are concerned about Nvidia's financial strategies in the AI sector, with warnings that the market could face a downturn. The chip giant's approach to maintaining the AI hype has sparked fears among market participants, especially after a recent incident where oil prices fell but the S&P 500 remained stable. This situation highlights shifting dynamics in the market, as Nvidia's valuation has made it the second-largest company globally. Analysts warn that the current enthusiasm may not be sustainable.
Source: Australian Financial Review
Other Headlines
Chinese stocks on track for worst month in decade
ASX slumps into a downgrade cycle on the eve of earnings season
How Mexico became a surprise cornerstone of America’s AI boom
HSBC winds down decades of local retail banking with Blackstone deal
Shell posts best quarterly profit in four years as Iran war boosts oil and gas prices
Japan carries out yen-buying intervention as US executes rate check
Tech rout roils markets after SK Hynix profits disappoint
Forget Trump’s new TACO, this is the bombshell really scaring markets
Samsung says chip crunch will last until 2028 as quarterly profit soars
Kumamoto quake disrupts TSMC, Toyota operations in southern Japan
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